Chilwa Minerals Ltd F-1/A, filed Aug 20, 2026
Chilwa Minerals Ltd (CHWM)
As filed with the Securities and Exchange Commission on August 20, 2026.
Registration No. 333-297336
UNITED
STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
AMENDMENT NO. 3
TO
FORM
F-1
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
Chilwa
Minerals Limited
(Exact name of registrant as specified in its
charter)
| Australia | 1400 | Not Applicable | ||
| (State or other jurisdiction
of incorporation or organization) |
(Primary Standard Industrial Classification Code Number) |
(I.R.S. Employer Identification Number) |
Chilwa Minerals Limited
Level 28, 140 St George’s Terrace
Perth, WA 6005
Australia
+61 8 6189 4924
(Address, including zip code, and telephone number, including area code, of registrant’s principal executive offices)
Vcorp
Services, LLC
25 Robert Pitt Drive, Suite 204
Monsey, New York 10952
Tel: +1 888 528 2677
(Name, address, including zip code, and telephone number, including area code, of agent for service)
Copies to:
| Andrew Reilly Rimôn Level 2, 50 Bridge Street Sydney, NSW 2000, Australia +61 2 9055 6965 andrew.reilly@rimonlaw.com |
Matthew
Bernstein New
York, NY 10105
|
Approximate date of commencement of proposed sale to the public: As soon as practicable after this Registration Statement becomes effective.
If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act, check the following box: ☐
If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐
If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐
If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act.
Emerging growth company ☒
If an emerging growth company that prepares its financial statements in accordance with U.S. GAAP, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 7(a)(2)(B) of the Securities Act. ☐
The registrant hereby amends this registration statement on such date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment which specifically states that this registration statement shall thereafter become effective in accordance with section 8(a) of the Securities Act of 1933 or until the registration statement shall become effective on such dates as the Commission, acting pursuant to said section 8(a), may determine.
The information in this preliminary prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell these securities and we are not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted.
Subject to completion, dated August 20, 2026
PRELIMINARY PROSPECTUS
800,000 American Depositary Shares representing 8,000,000 Ordinary Shares
Warrants to purchase 800,000 American Depositary
Shares
representing 8,000,000 Ordinary Shares
$ per American Depositary Share and accompanying Warrant
We are offering 800,000 American Depositary Shares, or ADSs, in the United States, representing 8,000,000 ordinary shares of Chilwa Minerals Limited (“Chilwa” or the “Company”), together with accompanying warrants to purchase ADSs (“Warrants”). Each ADS is being sold together with one Warrant. Each Warrant is exercisable for one ADS at an exercise price of US$ per ADS, exercisable from the date of issuance until five years thereafter. Each ADS represents 10 ordinary shares, deposited with The Bank of New York Mellon, as depositary.
The offering is being underwritten on a firm commitment basis.
Prior to this offering, there has been no public market for the ADSs. We have applied to list the ADSs on the Nasdaq Capital Market under the symbol “CHWM”. In addition, there is no established public trading market for the Warrants and we do not expect a market to develop. We do not intend to apply for a listing of the Warrants on any national securities exchange.
Our ordinary shares are listed on the Australian Securities Exchange under the symbol “CHW.” On August 17, 2026, the last reported sale price of our ordinary shares on the Australian Securities Exchange was A$0.70 per ordinary share, equivalent to a price of US$5.00 per ADS, after giving effect to the Australian dollar/U.S. dollar exchange rate of 0.7114 as of August 17, 2026, and an ADS-to-ordinary share ratio of 1 to 10.
The final offering price per ADS in U.S. dollars will be determined through negotiations between us and the representatives of the underwriter and will be based, in part, on prevailing market prices of our ordinary shares on the Australian Securities Exchange, after taking into account market conditions and other factors. For a discussion of the other factors considered in determining the final offering price per ADS, see “Underwriting.”
| Per ADS and Accompanying Warrant(1) | Total | |||||
| Public offering price | US$ | US$ | ||||
| Underwriting discounts and commissions(2) | US$ | US$ | ||||
| Proceeds to us, before expenses | US$ | US$ |
| (1) | Each ADS is being sold together with one Warrant and each Warrant is exercisable for one ADS at an exercise price of US$ per ADS. |
| (2) | In addition, we have agreed to reimburse the underwriter for certain expenses. See “Underwriting” on page 88 of this prospectus for additional information. |
We have granted the underwriter an option to buy up to an additional 120,000 ADSs and/or 120,000 Warrants to cover over-allotments. The underwriter may exercise this option at any time and from time to time during the 45-day period from the date of this prospectus.
Investing in our securities involves a high degree of risk. See the section entitled “Risk Factors” appearing on page 6 of this prospectus and elsewhere in this prospectus for a discussion of information that should be considered in connection with an investment in our securities.
Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or passed upon the adequacy or accuracy of this prospectus. Any representation to the contrary is a criminal offense.
The underwriter expects to deliver the ADSs and Warrants to purchasers on or about , 2026 through the book-entry facilities of The Depository Trust Company.
Sole Book-Runner
Maxim Group LLC
The date of this prospectus is , 2026
TABLE OF CONTENTS
We are responsible for the information contained in this prospectus and any free writing prospectus we prepare or authorize. We and the underwriter have not authorized anyone to provide you with different information. We and the underwriter take no responsibility for, and can provide no assurance as to the reliability of, any other information others may give you. We are not, and the underwriter is not, making an offer to sell these securities in any jurisdiction where the offer or sale is not permitted. You should not assume that the information contained in this prospectus is accurate as of any date other than its date.
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Introduction
Chilwa Minerals Limited was incorporated in Australia in February 2022. The primary listing of our ordinary shares is the Australian Securities Exchange (“ASX”) and this prospectus relates to an initial public offer in the United States with a secondary listing of our ordinary shares, in the form of American Depositary Shares (“ADSs”), on the Nasdaq Capital Market, along with accompanying warrants (“Warrants”) to purchase ADSs. As used in this prospectus, the terms “we,” “us,” “our”, “Chilwa” and the “Company” mean Chilwa Minerals Limited and its subsidiaries, unless otherwise indicated.
Financial and Other Information
Our consolidated financial statements appearing in this prospectus are prepared in Australian dollars and in accordance with the International Financial Reporting Standards (“IFRS”), as issued by the International Accounting Standards Board. Our consolidated financial statements appearing in this Registration Statement on Form F-1 comply with IFRS as issued by the International Accounting Standards Board.
In this prospectus:
| ● | all references to “U.S. dollars” or “US$” are to the currency of the United States and all references to “Australian dollars” or “$” or “A$” are to the currency of Australia; and |
| ● | “fiscal” year refers to the period between July 1 and June 30 of the following calendar year. |
Special note regarding Forward-looking Statements
This prospectus contains forward-looking statements about us and our industry that involve substantial risks and uncertainties. All statements other than statements of historical facts contained in this prospectus, including statements regarding our future results of operations, financial condition, business strategy and plans and objectives of management for future operations, are forward-looking statements. In some cases, you can identify forward-looking statements because they contain words such as “anticipate,” “believe,” “contemplate,” “continue,” “could,” “estimate,” “expect,” “intend,” “may,” “plan,” “potential,” “predict,” “project,” “should,” “target,” “will,” or “would,” or the negative of these words or other similar terms or expressions.
We have based these forward-looking statements largely on our current expectations and projections about future events and trends that we believe may affect our financial condition, results of operations, business strategy and financial needs. These forward-looking statements are subject to a number of known and unknown risks, uncertainties, other factors and assumptions, including the risks described in “Risk Factors” and elsewhere in this prospectus, regarding, among other things:
| ● | our exploration activities and our business operations in general; |
| ● | sufficiency of our cash resources; |
| ● | our ability to profitably extract minerals; |
| ● | our ability to raise additional funding when needed; |
| ● | any statements concerning anticipated regulatory approvals or collaborative arrangements, including our ability to obtain governmental approvals and permits; |
| ● | our operational risks; |
| ● | our ability to remain compliant with the Australian Securities Exchange and Nasdaq’s continuing listing standards; |
| ● | our ability to remediate identified material weaknesses in our internal control over financial reporting; |
| ● | any statement of assumptions underlying any of the foregoing; and |
| ● | other risks and uncertainties, including those listed under “Risk Factors.” |
These risks are not exhaustive. Other sections of this prospectus may include additional factors that could harm our business and financial performance. New risk factors may emerge from time to time and it is not possible for our management to predict all risk factors, nor can we assess the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in, or implied by, any forward-looking statements.
You should not rely on forward-looking statements as predictions of future events. We have based the forward-looking statements contained in this prospectus primarily on our current expectations and projections about future events and trends that we believe may affect our business, financial condition and operating results. We undertake no obligation to update any forward-looking statements made in this prospectus to reflect events or circumstances after the date of this prospectus or to reflect new information or the occurrence of unanticipated events, except as required by law. We may not actually achieve the plans, intentions or expectations disclosed in our forward-looking statements, and you should not place undue reliance on our forward-looking statements. Our forward-looking statements do not reflect the potential impact of any future acquisitions, mergers, dispositions, joint ventures or investments.
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In addition, statements that “we believe” and similar statements reflect our beliefs and opinions on the relevant subject. These statements are based on information available to us as of the date of this prospectus. While we believe that information provides a reasonable basis for these statements, that information may be limited or incomplete. Our statements should not be read to indicate that we have conducted an exhaustive inquiry into, or review of, all relevant information. These statements are inherently uncertain, and investors are cautioned not to unduly rely on these statements.
You should read this prospectus and the documents that we reference in this prospectus and have filed as exhibits to the registration statement of which this prospectus is a part with the understanding that our actual future results, levels of activity, performance and achievements may be different from what we expect. We qualify all of our forward-looking statements by these cautionary statements.
Industry and Market Data
This prospectus contains estimates and information concerning our industry and our business. Unless otherwise expressly stated, we obtained this industry, business, market and other information from reports, research surveys, studies and similar data prepared by third parties, industry, and general publications, government data and similar sources.
This information involves a number of assumptions and limitations. Although we are responsible for all of the disclosure contained in this prospectus and we believe the third-party market position, market opportunity and market size data included in this prospectus are reliable, we have not independently verified the accuracy or completeness of this third-party data. In addition, projections, assumptions and estimates of our future performance and the future performance of the industry in which we operate are necessarily subject to a high degree of uncertainty and risk due to a variety of factors, including those described in “Risk Factors.” These and other factors could cause results to differ materially from those expressed in these publications and reports.
Cautionary Note Regarding Presentation of Mineral Reserve and Mineral Resource Estimates
The Securities and Exchange Commission (the “SEC”) adopted new mineral property disclosure requirements in subpart 1300 of Regulation S-K (the “SEC Mining Disclosure Rules”) effective January 2021 that are applicable to all companies filing registration statements with the SEC. These rules better align disclosure with international regulatory practices, including the Joint Ore Reserves Committee of the Australasian Institute of Mining and Metallurgy, Australian Institute of Geoscientists and Minerals Council of Australia (“JORC”). However, while the definitions in the SEC Mining Disclosure Rules are more similar to those in JORC compared to the previous SEC disclosure rules, there are differences in the definitions and standards under the SEC Mining Disclosure Rules and JORC.
Investors are therefore cautioned that public disclosure by us of mineral resources in Australia in accordance with JORC (as required by the ASX Listing Rules) does not form a part of this prospectus. Estimates under JORC are not directly comparable to disclosure prepared under the SEC Mining Disclosure Rules. Such estimates do not form a part of this prospectus or of any of our other filings with the SEC. You should not rely on any mineral resource estimate that we have disclosed or may disclose in Australia, or that appears in our ASX announcements, investor presentations or on our website, in deciding whether to invest in the ADSs. We are unable to report such estimates in our filings with the SEC because we have not established the technical and economic conditions that are necessary to show reasonable prospects for economic extraction, based on the definition of resources in the SEC Mining Disclosure Rules.
We are still in the exploration stage and our planned commercial operations have not commenced. There is currently no commercial production at our projects. We have not produced a scoping study on our projects. We have not yet completed a preliminary economic assessment or started a preliminary feasibility study of our projects. As such, our projects’ estimated proven or probable mineral reserves cannot be determined at this time. Under the SEC Mining Disclosure Rules, mineralization may not be classified as a reserve unless the determination has been made that the mineralization could be economically and legally produced or extracted at the time the reserve determination is made. We are an exploration stage company and we have no mineral reserves as defined by the SEC Mining Disclosure Rules.
Our Registration Statement on Form F-1, as originally filed with the SEC on July 9, 2026, contained estimates of mineral resources that were stated to have been prepared in accordance with the SEC Mining Disclosure Rules, together with a technical report summary prepared by Belenos Holdings (Pty) Ltd filed as Exhibit 96.1 and the related consents of qualified persons. Those mineral resource estimates, that technical report summary and those consents have been removed from this amendment to our Registration Statement on Form F-1 in their entirety, as has the statement that those estimates conformed to the requirements of the SEC Mining Disclosure Rules. You should not rely on the mineral resource estimates, the technical report summary, the qualified person consents or the statement of conformity with the SEC Mining Disclosure Rules that were included in or filed with the Registration Statement on Form F-1, as originally filed with the SEC on July 9, 2026. None of that information forms a part of this prospectus. This prospectus does not contain any estimate of mineral resources or mineral reserves.
You are cautioned that, except for any mineral resources classified as mineral reserves, mineral resources do not have demonstrated economic value. Inferred mineral resources have a high degree of uncertainty as to their existence and as to whether they can be economically or legally mined. Estimates of inferred mineral resources may not form the basis of an economic analysis. It cannot be assumed that all or any part of an inferred mineral resource will ever be upgraded to a higher category. A significant amount of exploration must be completed in order to determine whether an inferred mineral resource may be upgraded to a higher category. Therefore, you are cautioned not to assume that all or any part of an inferred mineral resource exists, that it can be economically or legally mined, or that it will ever be upgraded to a higher category. Likewise, you are cautioned not to assume that all or any part of measured or indicated mineral resources will ever be upgraded to mineral reserves.
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Glossary of Terms
Assay means, in economic geology, to analyze the proportions of metal in a rock or overburden sample; to test an ore or mineral for composition, purity, weight or other properties of commercial interest.
Deposit means a mineralized body which has been physically delineated by sufficient drilling, trenching, and/or underground work, and found to contain a sufficient average grade of metal or metals to warrant further exploration expenditures; such a deposit does not qualify as a commercially mineable ore body or as containing ore reserves, until final legal, technical, and economic factors have been resolved.
Grade or grade means the amount of valuable metal in each tonne of ore, expressed as grams per tonne (g/t) for precious metals and as percent (%) for antimony.
km means kilometre(s).
m means metre(s) (equivalent to 3.281 feet).
M means million.
Mineralization or mineralization means the concentration of metals and their chemical compounds within a body of rock.
Mineral Reserve or mineral reserve means an estimate of tonnage and grade or quality of indicated and measured mineral resources that, in the opinion of the qualified person, can be the basis of an economically viable project. More specifically, it is the economically mineable part of a measured or indicated mineral resource, which includes diluting materials and allowances for losses that may occur when the material is mined or extracted.
Mineral Resource or mineral resource means a concentration or occurrence of material of economic interest in or on the Earth’s crust in such form, grade or quality, and quantity that there are reasonable prospects for economic extraction. A mineral resource is a reasonable estimate of mineralization, taking into account relevant factors such as cut-off grade, likely mining dimensions, location or continuity, that, with the assumed and justifiable technical and economic conditions, is likely to, in whole or in part, become economically extractable. It is not merely an inventory of all mineralization drilled or sampled.
Ore means a mineral reserve of sufficient value as to quality and quantity to enable it to be mined at a profit.
Conversion of measurement units
| In converting from: | To: | Multiply by | ||
| Feet | Metres (m) | 0.305 | ||
| Metres | Feet (ft) | 3.281 | ||
| Miles | Kilometres (km) | 1.609 | ||
| Hectares | Acres | 2.471 | ||
| Kilometres | Miles | 0.6214 | ||
| Grams | Ounces (Troy) (oz) | 0.03215 |
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This summary highlights selected information contained elsewhere in this prospectus. This summary does not contain all of the information you should consider before investing in the ADSs and Warrants. You should read this entire prospectus, and the registration statement of which this prospectus is a part, including “Risk Factors,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” and our consolidated financial statements and the related notes included elsewhere in this prospectus, before making an investment decision. Unless otherwise indicated or the context otherwise requires, “Chilwa,” the “Company,” “our company,” “we,” “us” and “our” refer to Chilwa Minerals Limited and its subsidiaries taken as a whole.
Overview
We are a mineral exploration company looking to deliver growth and value for our shareholders through achieving success from exploration and evaluation programs. Our principal activities are mineral exploration activities at the Chilwa Critical Minerals Project (the “Project”), which is located around the northern, western and southern shores of Lake Chilwa in southern Malawi.
Malawi, a landlocked country in southeastern Africa famed for the warmth and kindness of its people, is known as “The Warm Heart of Africa.” It is bordered by Zambia to the west, Tanzania to the north and northeast, and Mozambique to the east, southeast and southwest. Malawi is an underexplored country and an emerging mining destination with a stable regime, a supportive government and a newly developed infrastructure network.
We hold, through our 100% owned subsidiaries Chilwa Minerals Africa Limited and Phalombe Minerals Limited, three exploration licenses that grant us the exclusive rights to carry out exploration for certain heavy mineral sands (“HMS”) and rare earth elements (“REE”) over a total tenement area of 881.0136 km2. The project hosts a geologically coherent and district-scale mineral system capable of supporting multiple styles of critical mineralisation, including:
| ● | Heavy Mineral Sands (“HMS”) |
| ● | Carbonatite-hosted REE |
| ● | Ionic Adsorption Clay Rare Earth Element potential |
Sectional interpretation has been done on all the northern deposits (Nkotamo, Halala, Beacon and Namanja West) on the Project.
In addition, we have intersected high-grade REE in the clays below the mineral sands, with many highly prospective carbonatite targets to be assessed, including Chisi Island. Other targets that require ground truthing have been identified in the southern extension area and Mpyupyu Area. The first batch of REE analysis was undertaken in July 2024 as a pathfinder process to assess the potential coexistence of REEs in the heavy mineral concentrates. The REEs that were included in the analysis were Cerium (Ce2O3), Europium (Eu2O3), Gadolinium (Gd2O3), Lanthanum (La2O3), Neodymium (Nd2O3), Praseodymium (Pr6O11), Samarium (Sm2O3) and Ytterbium (Yb2O3). Diamond drilling in late 2024 has also yielded positive results, confirming the presence of REE mineralization. Substantial advancements in exploration and resource development in the REE sector have been made, with over 47 geophysical features/anomalies identified. We believe that the discovery of new exploration targets and the successful completion of several exploration and drilling programs have significantly strengthened our overall portfolio and positioned us well to continue to explore for REE, essential for various high-tech applications.
We believe the Project can develop into a viable mineral sands project and that we are exploring a Tier 1 mineralized system in southern Malawi.
Corporate Information
Our legal name is Chilwa Minerals Limited. Chilwa was incorporated in Australia in February 2022 and listed on the ASX in July 2023 under the symbol “CHW”.
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Our registered office is located at Level 28, 140 St George’s Terrace, Perth, Western Australia, Australia and our telephone number is +61 8 6189 4924. Our website address is www.chilwaminerals.com.au. The information on, or accessible through, our website is not part of this prospectus. We have included our website address in this prospectus solely as an inactive textual reference. All information we file with the SEC is available through the SEC’s Electronic Data Gathering, Analysis and Retrieval system, which may be accessed through the SEC’s website at www.sec.gov.
Implications of Being an Emerging Growth Company
As a company with less than US$1.235 billion in revenue during our last fiscal year, we qualify as an “emerging growth company” as defined in the JOBS Act. As an emerging growth company, we may take advantage of specified reduced disclosure and other requirements that are otherwise applicable generally to public companies in the United States. These provisions include exemption from the auditor attestation requirement of Section 404 of the Sarbanes-Oxley Act of 2002, or the Sarbanes-Oxley Act, in the assessment of our internal controls over financial reporting.
We may take advantage of such exemptions until such time that we are no longer an emerging growth company. Accordingly, the information that we provide shareholders and holders of the ADSs may be different than you might obtain from other public companies. We will cease to be an emerging growth company upon the earliest to occur of (i) the last day of the fiscal year in which we have more than US$1.235 billion in annual revenue; (ii) the last day of the fiscal year in which we qualify as a “large accelerated filer”; (iii) the date on which we have, during the previous three-year period, issued more than US$1.0 billion in non-convertible debt securities; and (iv) the last day of the fiscal year in which the fifth anniversary of this offering occurs.
Implications of Being a Foreign Private Issuer
We are also considered a “foreign private issuer” under U.S. securities laws. In our capacity as a foreign private issuer, we are exempt from certain rules under the U.S. Securities Exchange Act of 1934 (the “Exchange Act”) that impose certain disclosure obligations and procedural requirements for proxy solicitations under Section 14 of the Exchange Act. In addition, our senior management and the members of our board of directors are exempt from “short-swing” profit recovery provisions of Section 16 of the Exchange Act and our principal shareholders are exempt from the reporting and “short-swing” profit recovery provisions of Section 16 of the Exchange Act and the rules under the Exchange Act with respect to their purchases and sales of our securities. Moreover, we are not required to file periodic reports and financial statements with the SEC as frequently or as promptly as U.S. companies whose securities are registered under the Exchange Act. In addition, we are not required to comply with Regulation FD, which restricts the selective disclosure of material information.
We may take advantage of these exemptions until such time as we are no longer a foreign private issuer. We will remain a foreign private issuer until such time that 50% or more of our outstanding voting securities are held by U.S. residents and any of the following three circumstances applies: (i) the majority of the members of board of directors or our senior management are U.S. citizens or residents; (ii) more than 50% of our assets are located in the United States; or (iii) our business is administered principally in the United States.
Risk Factors Summary
Our business is subject to a number of risks of which you should be aware prior to making a decision to invest in the ADSs. You should carefully consider all of the information set forth in this prospectus and, in particular, should evaluate the specific factors set forth in the section titled “Risk Factors” before deciding whether to invest in the ADSs. Among these important risks are, but not limited to, the following:
| ● | We have a history of losses and may not generate revenue from our operations or achieve or maintain profitability if our development and production plans are not achieved. |
| ● | We require significant additional capital to fund our business, which may not be available on acceptable terms or at all. There is substantial doubt about our ability to continue as a going concern if we are unable to raise additional working capital as required. |
| ● | The nature of our mineral exploration activities involves a high degree of risk. |
| ● | Our exploration activities require substantial capital, and actual costs and timelines may significantly exceed our estimates. |
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| ● | Our ability to continue the exploration, permitting, development, and construction of our projects will depend in part on our ability to obtain suitable financing. |
| ● | We have no history of producing heavy mineral sands or rare earth elements from our mineral properties and there can be no assurance that we will successfully establish mining operations or profitably produce heavy mineral sands or rare earth elements. |
| ● | Any material changes in any mineral resource/reserve estimates and grades of mineralization will affect the economic viability of placing a property into production and a property’s return on capital. |
| ● | The future profitability of our operations, and any future cash flows generated by our operations, will be affected by changes in the market price for heavy mineral sands and rare earth elements. |
| ● | We may not be able to obtain or maintain all required permits and licenses, which could materially and adversely affect our business, financial condition, and prospects. |
| ● | The exploration and development of our projects may not be profitable. |
| ● | The trading price of the ADSs may be volatile, and purchasers of the ADSs could incur substantial losses. |
| ● | There has been no prior market for the ADSs and an active and liquid market for our securities may fail to develop, which could harm the market price of the ADSs. |
| ● | You will experience immediate and substantial dilution in the net tangible book value of the ADSs you purchase in this offering. |
| ● | As long as we remain subject to the rules of the ASX and Nasdaq, we will be unable to access equity capital without shareholder approval if such equity capital sales would result in an equity issuance above regulatory thresholds and, consequently, we may be unable to obtain financing sufficient to sustain our business if we are unsuccessful in soliciting requisite shareholder approvals. |
| ● | ADS holders are not shareholders and do not have shareholder rights. |
| ● | Australian takeover laws may discourage takeover offers being made for us or may discourage the acquisition of large numbers of our shares. |
| ● | We have identified several material weaknesses in our internal control over financial reporting. Failure to effectively remediate these weaknesses, the emergence of additional material weaknesses, or a failure to maintain effective internal controls could impair our ability to produce timely and accurate financial statements and to comply with applicable laws and regulations. |
| ● | U.S. investors may have difficulty enforcing civil liabilities against our company, our directors or member of senior management and the experts named in this prospectus. |
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| Securities offered by us | 800,000 ADSs, together with 800,000 Warrants to purchase 800,000 ADSs (excluding any exercise of underwriter’s option). Each ADS is being sold together with one Warrant. | |
| Option to purchase additional securities | The underwriter has an option for a period of 45 days from the date of this prospectus to purchase up to 120,000 additional ADSs and/or 120,000 Warrants. | |
| Ordinary shares to be outstanding after this offering, including shares underlying ADSs | 106,006,092 ordinary shares (or 106,126,092 ordinary shares if the underwriter exercises its option to purchase additional ADSs in full). | |
| American depositary shares | Each ADS represents 10 ordinary shares. The ADSs are delivered by the depositary. You will have the rights of an ADS holder as provided in the deposit agreement among us, the depositary and all owners and holders of ADSs issued thereunder. The depositary, through its custodian, will be the holder of the ordinary shares underlying the ADSs. | |
| You may surrender your ADSs to the depositary for cancellation to receive the ordinary shares underlying your ADSs. The depositary will charge you a fee for such a cancellation. | ||
| We may amend or terminate the deposit agreement for any reason without your consent. Any amendment that imposes or increases fees or charges or that materially prejudices any substantial existing right you have as an ADS holder will not become effective as to outstanding ADSs until 30 days after notice of the amendment is given to ADS holders. If an amendment becomes effective, you will be bound by the deposit agreement as amended if you continue to hold your ADSs. | ||
| To better understand the terms of the ADSs, you should carefully read the section titled “Description of Securities.” We also encourage you to read the deposit agreement, which is filed as an exhibit to the registration statement of which this prospectus forms a part. | ||
| Warrants | Each Warrant will have an exercise price of US$ per ADS, will be exercisable upon issuance and will expire five years from the date of issuance. The ADSs issuable upon exercise of the Warrants will be subject to anti-dilution upon the occurrence of certain stock dividends and distributions, stock split, stock subdivision and combinations, reclassifications or similar events affecting our ADSs or ordinary shares, or upon the occurrence of a change in ADS ratio. To better understand the terms of the Warrants, you should carefully read the section in this prospectus entitled “Description of Securities.” | |
| Depositary | The Bank of New York Mellon |
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| Use of proceeds | We estimate that the net proceeds from the sale of the securities that we are selling in this offering will be approximately US$2.9 million (or approximately US$3.5 million if the underwriter’s option to purchase additional ADSs is exercised in full), based upon an assumed initial public offering price of US$5.00 per ADS, after giving effect to the Australian dollar/U.S. dollar exchange rate of 0.7114 as of August 17, 2026, and an ADS-to-ordinary share ratio of 1-to-10, after deducting underwriting discounts and commissions and estimated offering expenses payable by us. The foregoing assumes that none of the Warrants (including any Warrants issued if the underwriter’s option to purchase additional Warrants is exercised in full) issued in the offering are exercised. If all of the Warrants were to be exercised in cash, we would receive additional proceeds of approximately US$5 million. We cannot predict when or if these Warrants will be exercised. It is possible that these Warrants may expire and may never be exercised. | |
| We intend to use the net proceeds from this offering, together with our existing cash, to further our exploration activities, for working capital and other general corporate purposes. See “Use of Proceeds” for additional information. |
| Representative’s Warrant | Upon the closing of this offering, we will issue a warrant to the underwriter (the “Representative’s Warrant”) entitling it to purchase a number of ordinary shares, represented by ADSs, equal to 5.0% of the ADSs sold in this offering. The Representative’s Warrant will be exercisable at a price equal to 125% of the public offering price of the ADSs and will expire five years following the date of commencement of sales in this offering. See “Underwriting.” | |
| Lock-up agreements | Our directors, executive officers, and its major shareholder have agreed with the Representative not to offer for sale, issue, sell, contract to sell, pledge or otherwise dispose of any of our ordinary shares or securities convertible into ordinary shares for a period of six months from the closing of this offering. | |
| Risk factors | See “Risk Factors” and the other information included in this prospectus for a discussion of the risks you should carefully consider before investing in the ADSs and Warrants. | |
| Proposed Nasdaq Capital Market symbol for the ADSs | We have applied to have the ADSs listed on Nasdaq under the symbol “CHWM”. In addition, there is no established public trading market for the Warrants and we do not expect a market to develop. We do not intend to apply for a listing of the Warrants on any national securities exchange. | |
| Australian Securities Exchange symbol for our ordinary shares | “CHW” |
The number of ordinary shares (including ordinary shares underlying ADSs) that will be outstanding after this offering is based on 98,006,092 ordinary shares outstanding as of June 30, 2026 and excludes 877,873 ordinary shares issuable upon the exercise of outstanding options as of June 30, 2026, with a weighted-average exercise price of A$0.35 per ordinary share.
In addition, unless we specifically state otherwise, the information in this prospectus assumes (i) no exercise of any Warrants issued in this offering, (ii) no exercise by the underwriter of its option to purchase up to additional ADSs and/or Warrants, (iii) no exercise of the Representative’s Warrant and (iv) no exercise of outstanding options to purchase ordinary shares.
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Investing in our securities involves a high degree of risk. Before making an investment decision, you should consider carefully the risks and uncertainties described below. Our business, operating results, financial condition or prospects could also be harmed by risks and uncertainties not currently known to us or that we currently do not believe are material. If any of the risks actually occurs, our business, operating results, financial condition and prospects could be adversely affected. In that event, the market price of our shares could decline, and you could lose part or all your investment. The risks discussed below may not prove to be exhaustive and are based on certain assumptions that later may prove to be incorrect or incomplete. We and our subsidiaries may face additional risks and uncertainties that are not presently known to such entity, or that are currently deemed immaterial, which may also impair our business or financial condition. The following discussion should be read in conjunction with the sections entitled “Cautionary Note Regarding Forward-Looking Statements,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and the financial statements and the notes thereto included herein, as applicable.
Unless the context otherwise requires, all references to “we,” “us,” or “our” in this section refer to Chilwa Minerals Limited and its subsidiaries.
Risks Related to Our Business
We have a limited operating history on which to assess our business.
Chilwa Minerals Limited was incorporated in February 2022 and has earned no revenue from operations, which may make it difficult to evaluate our current business and the likelihood of our success. We have no history of commercial production from our mineral properties and there can be no assurance that we will successfully establish mining operations or profitably produce metals. The prospects of our company must be considered in light of the risks, expenses and difficulties frequently encountered by companies in the early stage of their development. We cannot be sure that we will be successful in addressing these risks and uncertainties and our failure to do so could have a materially adverse effect on our financial condition.
We have a history of losses and may not generate revenue from our operations or achieve or maintain profitability if our development and production plans are not achieved.
We have incurred losses since inception and have had negative cash flow from operating activities. For fiscal years 2025 and 2024, we had a net loss of A$3.4 million and A$1.8 million, respectively and net cash used in operating activities of A$2.0 million and A$1.8 million, respectively. The Project is not in production or currently under construction, and we have no ongoing mining operations or revenue from mining operations. We have incurred net losses since inception and expect to continue to incur losses unless and until the Project enters commercial production and generates sufficient revenues to fund continuing operations. If we are unable to generate significant revenues from mining operations, we will not be able to earn profits.
Further exploration and appraisals are required to determine the extent to which the Project contains economically viable mineral deposits and whether the deposits can be profitably exploited. It is common in exploration programs to experience unexpected problems and delays, and there is a significant risk that further exploration may not be successful, may be delayed, or may cost more than currently anticipated. If our exploration activities prove commercially unsuccessful, we may be required to abandon our plans to develop the Project and our exploration investments, which will have an adverse effect on the market value of our securities and our ability to raise future financing.
Therefore, there are no assurances that our activities will result in profitable mining operations, that we will successfully establish mining operations, or that we will profitably produce metals at the Project.
We require significant additional capital to fund our business, which may not be available on acceptable terms or at all. There is substantial doubt about our ability to continue as a going concern if we are unable to raise additional working capital as required.
As of June 30, 2026, we had cash and cash equivalents of A$1,101,524. Our ability to continue as a going concern is dependent upon our ability to generate profitable operations in the future and/or to obtain the necessary financing to meet our obligations and repay our liabilities arising from normal business operations when they come due.
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We require significant additional capital to fund our business, which may not be available on acceptable terms or at all. Due to the nature of our current operations, being mineral exploration, we do not have ready access to credit facilities. The primary source of our funding has been equity raisings. We may also seek to raise funds through joint ventures, production sharing arrangements or other means. However, there is no assurance that we will be able to successfully obtain the necessary financing at all or available on terms acceptable to us. Any additional equity financing may result in dilution for some or all shareholders, and debt financing, if available, may involve restrictive covenants, which limit operations and business strategy.
If we are unable to raise additional capital if and when required, this could delay, suspend or reduce the scope of our business operations (including scaling back exploration programs) and could have a material adverse effect on our operating and financial performance, and there is significant uncertainty as to whether we will be able to meet our obligations as and when they fall due and thus continue as a going concern.
The nature of our mineral exploration activities involves a high degree of risk.
Our long-term success depends on our ability to expand the known mineralization and/or identify new mineral zones or deposits on the Project and other properties we may acquire, if any, that we can then develop into commercially viable mining operations. Mineral exploration is highly speculative in nature. Discovery of mineral deposits is dependent upon a number of factors and significantly influenced by the technical skill of the exploration personnel involved. The commercial viability of a mineral deposit is also dependent upon a number of factors which are beyond our control, including the attributes of the deposit, commodity prices, government policies and regulation, and environmental protection requirements. Many exploration programs do not result in the discovery of mineralization, and any mineralization discovered may not be of sufficient quantity or quality to be profitably mined.
Risks
normally incidental to exploring for and developing mineral properties include but are not limited to:
| ● | unusual or unexpected geologic formations; |
| ● | economically insufficient mineralized material; |
| ● | fluctuation in production costs that make mining uneconomical; |
| ● | unanticipated variations in grade and other geologic uncertainties; |
| ● | difficult surface or underground conditions; |
| ● | the availability and proper performance of necessary equipment, supplies, and infrastructure; |
| ● | the availability of mineral professionals, skilled labor, and support for our workforce; |
| ● | difficulty with obtaining or maintaining the requisite license or permit; |
| ● | adverse changes in the global or local legal, political, and economic environment; |
| ● | litigation and/or title claims; |
| ● | labor disputes or unrest, personal injury, industrial accidents, civil disorder, political hostilities, war, subversive activities or sabotage; |
| ● | liability for pollution, cave-ins or similar hazards; |
| ● | fires, floods, explosions, epidemics, pandemics, or other catastrophes or natural disasters; and |
| ● | potential opposition from non-governmental organizations, local groups or local inhabitants that may delay or prevent development activities. |
Any of these risks can materially and adversely affect, among other things, the development of properties, production quantities and rates, costs and expenditures, potential revenues, and production dates. If we determine that capitalized costs associated with any of our mineral interests are not likely to be recovered, we would incur a write-down of our investment in these interests. All these factors may result in losses in relation to amounts spent that are not recoverable, or that result in additional expenses.
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Our exploration activities require substantial capital, and actual costs and timelines may significantly exceed our estimates.
Substantial expenditures are required to establish proven and probable reserves through drilling and analysis, to develop processes to extract metal, and to develop the mining and processing facilities and infrastructure at any site chosen for mining. Our estimated expenditure is based on assumptions regarding the method and timing of exploration and feasibility work. By their nature, these assumptions are subject to significant uncertainties. The actual costs, timing, and complexities of exploration, development and mining activities may be significantly higher than estimated. In addition, we may be subject to significant unforeseen expenses or actions, which may include unplanned operating expenses, future legal actions or expenses in relation to future unforeseen events.
We have no history of producing heavy mineral sands or rare earth elements from our mineral properties and there can be no assurance that we will successfully establish mining operations or profitably produce heavy mineral sands or rare earth elements.
We have no history of producing any minerals from our properties. While we seek to move our projects into production, such efforts will be subject to all the risks associated with establishing new mining operations and business enterprises, including:
| ● | the timing and cost, which are considerable, of the construction of mining and processing facilities; |
| ● | the ability to find sufficient reserves to support a profitable mining operation; |
| ● | the availability and costs of skilled labor and mining equipment; |
| ● | compliance with environmental and other governmental approval and permit requirements; |
| ● | the availability of funds to finance construction and development activities; |
| ● | potential opposition from non-governmental organizations, environmental groups, local groups or local inhabitants that may delay or prevent development activities; and |
| ● | potential increases in construction and operating costs due to changes in the cost of labor, fuel, power, materials and supplies. |
The costs, timing and complexities of mine construction and development may be increased by the remote location of our property. It is common in new mining operations to experience unexpected problems and delays during construction, development and mine start-up. In addition, our management team will need to be expanded. This could result in delays in the commencement of mineral production and increased costs of production. Accordingly, we cannot assure you that our activities will result in profitable mining operations or that we will successfully establish mining operations.
Any material changes in any mineral resource/reserve estimates and grades of mineralization will affect the economic viability of placing a property into production and a property’s return on capital.
As we have not completed a feasibility study on any of our properties and have not commenced actual production, any mineralization resource estimates may require adjustments or downward revisions. In addition, the grade of minerals ultimately mined, if any, may differ from that indicated by our feasibility studies and drill results. Minerals recovered in small scale tests may not be duplicated in large scale tests under on-site conditions or in production scale.
The resource estimates that we may calculate in the future will be determined based on assumed future prices, cut-off grades and operating costs that could prove to be inaccurate. Any extended declines in market prices for heavy mineral sands or rare earth elements could render portions of our mineralization and resource estimates uneconomic and result in reduced reported mineralization or adversely affect any commercial viability determinations that we may reach. Any material reductions in estimates of mineralization, or of our ability to extract this mineralization, could have a material adverse effect on our share price and the value of our property.
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The future profitability of our operations, and any future cash flows generated by our operations, are affected by changes in the market price for heavy mineral sands or rare earth elements.
We expect that substantially all our revenue and cash flows will come from the sale of heavy mineral sands or rare earth elements if we enter the production stage. Historically, the market price for heavy mineral sands or rare earth elements has fluctuated widely and has been affected by numerous factors over which we have no control, including:
| ● | the demand for heavy mineral sands and rare earth elements; |
| ● | international or regional political and economic trends; |
| ● | financial market expectations regarding the rate of inflation; |
| ● | interest rates; |
| ● | the production and cost levels for heavy mineral sands and rare earth elements at competing projects; and |
| ● | speculative activities. |
If prices for heavy mineral sands or rare earth elements were to fall below and remain below our cost of production for any sustained period, then we could experience losses and may be forced to curtail or suspend some or all of mining operations. In addition, we would also have to assess the economic impact of low prices on our ability to recover any losses we may incur during that period and on our ability to maintain adequate reserves.
We may not be able to obtain or maintain all required permits and licenses, which could materially and adversely affect our business, financial condition, and prospects.
We hold three licenses that grant us the exclusive rights to carry out exploration for certain HMS and REE in the license areas. Our 100% owned subsidiary, Chilwa Minerals Africa Limited, holds two licenses that grant us the exclusive rights to carry out exploration for certain HMS and REE in the license areas. Exploration License Number EL0670/22R1, originally granted on September 27, 2022 and currently valid until July 17, 2028, covers an area of 418.2851 km2 around Lake Chilwa, including the districts of Phalombe, Zomba and Mulanje. Exploration License Number EL0671/22R1, originally granted on September 26, 2022 and currently valid until July 17, 2028, covers an area of 12.84 km2 on Chisi Island in the district of Zomba. In addition, our 100% owned subsidiary, Phalombe Minerals Limited, has been granted an exploration license EL0835/25, valid from July 18, 2025 to July 17, 2030, covers an area of 449.8885 km2, with the option to extend, to carry on exploration activities in Mulanje, Phalombe and Zomba Districts. The maintenance and extension of the licenses are subject to various conditions described under “Business - Government and Environmental Regulations”, and the laws and regulations governing the maintenance or renewal are subject to change. In addition, future development of the Project will require obtaining licenses or permits for the construction and operation of mines, processing plants and related infrastructure. We plan to work with the Government of Malawi to secure a mining license and a mining development agreement.
There can be no assurance that we can maintain any of the licenses and permits required for continued exploration, development or the operation of future mining operations, on reasonable terms, if at all. Costs related to applying for, obtaining and maintaining permits and licenses may be prohibitive and could delay our planned exploration and development activities. To the extent such approvals are required and are not obtained, we may be delayed or prohibited from proceeding with planned exploration or development of the mineral properties, and we may suffer significant damage as a result.
We may be unable to purchase additional mining licenses or properties.
As part of our business strategy, we may make acquisitions of, or significant investments in, other resource projects. Any such future transactions would be accompanied by the risks commonly encountered in making acquisitions of resource projects. In addition, we may not be able to secure the necessary funding or successfully acquire new licenses or properties. Such limitations could adversely impact our business prospects, operations, and long-term growth objectives.
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We may be subject to mandatory relinquishment of exploration areas on extension of our licenses.
The initial term of an exploration license is five years from the date of grant. A holder may apply for extensions of the term for periods of up to three (3) years, but no more than two such extension applications may be made. Exploration License Number EL0670/22R1 and Exploration License Number EL0671/22R1 have already been renewed once. In terms of applicable law, when applying for the extension of the term of an exploration license, the applicant must reduce the size of its last approved area by at least half, unless such reduction would result in a license area of less than 25km2. In that case, the applicant may request and have approved an area of up to 25km2. The exploration area of Exploration License Number EL0670/22R1 has previously been reduced by 50% (from 865.86km2 to 418.2851km2). As a result, even if we meet work and compliance obligations, extensions may require surrender of a substantial portion of the license area of our Exploration Licenses that are currently larger than 25km2, which may include ground later determined to be prospective. This could limit our ability to fully explore or develop mineral resources within the original license area, impact resource conversion and mine planning, and adversely affect the long-term potential of the Project.
Mineral exploration and development are dependent on adequate infrastructure.
Exploration, development and processing activities depend, to a large degree, on adequate infrastructure. In particular, reliable power sources, water supply, transportation and surface facilities are necessary to explore and develop mineral projects. The lack of availability of acceptable terms or the delay in the availability of any one or more of these items could prevent or delay exploration or development of our mineral properties. If adequate infrastructure is not available in a timely manner, there can be no assurance that the exploration or development of our mineral properties will be commenced or completed on a timely basis, if at all. Furthermore, unusual or infrequent weather phenomena, sabotage, government or other interference in the maintenance or provision of necessary infrastructure could adversely affect our operations.
A shortage of equipment and supplies could adversely affect our ability to operate our business.
We are dependent on various supplies and equipment to carry out our mining exploration and, if warranted, development operations. Any shortage of such supplies, equipment, and parts could result in increased costs or otherwise have a material adverse effect on our ability to carry out our operations.
Our operations in Malawi expose us to a variety of risks inherent in conducting business in an emerging market jurisdiction.
Our international operations in Malawi are subject to a number of risks, including, among others, economic, social or political instability or change; increases in transportation, logistics or shipping costs; restrictive or unpredictable governmental actions, such as imposition of trade quotas, tariffs and other taxes; inflationary pressures; currency non-convertibility or volatility; and uncertainties associated with the legal and regulatory environment.
Adverse changes in government policies or legislation of Malawi that affect ownership of mineral interests, taxation, royalties, land access, native title, environmental protection, carbon emissions, labor and mining could have a material adverse impact on our operations. If the current system of exploration and mine permitting in Malawi and other jurisdictions in which we may acquire projects and operate changes, we could experience impairment of rights and possibly expropriation of our properties without adequate compensation. For example, under Section 260 of the Mines and Minerals Act No. 25 of 2023 (the “Mining Act”), the Malawian government retains a statutory right to acquire a free, non-dilutable equity interest in any company that applies for a large-scale mining license. This option may be exercised at no cost to the Malawian government, and does not require the Malawian government to contribute capital, fund project costs, or assume operational obligations. The Malawian government’s equity participation right becomes exercisable upon submission of a large-scale mining license application and expires once the license is either granted or denied. While this provision of the Mining Act does not currently apply to our Project, as we have not determined whether we will apply for a medium-scale or large-scale mining license, there can be no assurance that such provision will not become applicable to the Project in the future. For further information about applicable Malawian regulations, see “Business – Government and Environmental Regulations”.
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Furthermore, the legal system in Malawi is less developed and less predictable than that of the United States, and this may result in a number of significant risks, including:
| ● | unfavorable changes in laws or regulations applicable to the mining and exploration industry or foreign investment, including those relating to government participation, the enforcement of legal rights, taxation, exchange controls, export duties, repatriation of income, return of capital, environmental compliance, immigration permits and labor matters; |
| ● | difficulty in obtaining effective legal redress, whether for breaches of law or regulation or in ownership or contractual disputes, due to limitations in judicial capacity or political sensitivities; |
| ● | a higher degree of discretion exercised by government officials or agencies, which may result in inconsistent application of laws, delays in approvals, or unexpected regulatory outcomes; |
| ● | limited administrative or interpretive guidance regarding the implementation of laws and regulations, including with respect to taxation and property rights; |
| ● | inconsistencies or conflicts among laws, regulations, decrees, and administrative orders, which can create uncertainty in operational planning and compliance; |
| ● | relative inexperience of courts and regulators in matters relevant to our business, including mining, permitting, and foreign investment; and |
| ● | significant delays in judicial proceedings or the issuance of judgments, which could impair our ability to resolve disputes in a timely or predictable manner. |
Any of these factors could materially and adversely affect our operations in Malawi, our ability to develop our mineral projects, and our business, financial condition and prospects.
The mineral exploration and mining industry is highly competitive.
The mineral exploration and mining industry is intensely competitive in all of its phases. Many of our competitors are large, established companies with substantial capabilities and greater financial and technical resources. We compete with other mining and exploration companies in connection with the acquisition of mining claims, the amount and quality of mineral reserves and resources, capital, and the recruitment and retention of qualified managerial and technical employees. In addition to our company, there are several other mineral sands projects in Malawi at various stages of development, such as Sovereign Metals, Mawei Mining, Crown Minerals Ltd, and Globe Metals & Mining Ltd. If we are unable to compete successfully, our exploration and development programs may be slowed down or suspended, and we may not be able to acquire, develop, or operate additional mining projects.
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We may pursue opportunities to acquire complementary businesses, which could dilute our shareholders’ ownership interests, incur expenditure and have uncertain returns.
We may seek to expand our business through future acquisitions of either companies or properties, however, there can be no assurance that we will locate attractive acquisition candidates, or that we will be able to acquire such candidates on economically acceptable terms, if at all, or that we will not be restricted from completing acquisitions pursuant to contractual arrangements. Future acquisitions may require us to expend significant amounts of cash, resulting in our inability to use these funds for other business or may involve significant issuances of equity. Future acquisitions may also require substantial management time commitments, and the negotiation of potential acquisitions and the integration of acquired operations could disrupt our business by diverting management’s attention away from day-to-day operations. The difficulties of integration may be increased by the necessity of coordinating geographically diverse organizations, integrating personnel with disparate backgrounds and combining different corporate cultures.
Any future acquisition involves potential risks, including, among other things: (i) mistaken assumptions and incorrect expectations about mineral properties, mineral resources and costs; (ii) an inability to successfully integrate any operation our company acquires; (iii) an inability to recruit, hire, train or retain qualified personnel to manage and operate the operations acquired; (iv) the assumption of unknown liabilities; (v) limitations on rights to indemnity from the seller; (vi) mistaken assumptions about the overall cost of equity or debt; (vii) unforeseen difficulties operating acquired projects, which may be in geographic areas new to us; and (viii) the loss of key personnel and/or key relationships at the acquired project.
At times, future acquisition candidates may have liabilities or adverse operating issues that we may fail to discover through due diligence prior to the acquisition. If we consummate any future acquisitions with unanticipated liabilities or that fail to meet expectations, our business, results of operations, cash flows or financial condition may be materially adversely affected. The potential impairment or complete write-off of goodwill and other intangible assets related to any such acquisition may reduce our overall earnings and could negatively affect our balance sheet.
Joint ventures and other partnerships may expose us to risks.
We may enter into joint ventures or partnership arrangements with other parties in relation to the exploration, development and production of the properties in which we have an interest. Joint ventures can often require unanimous approval of the parties to the joint venture or their representatives for certain fundamental decisions such as an increase or reduction of registered capital, merger, division, dissolution, amendments of constating documents, and the pledge of joint venture assets, which means that each joint venture party may have a veto right with respect to such decisions which could lead to a deadlock in the operations of the joint venture. Further, we may be unable to exert control over strategic decisions made in respect of such properties. Any failure of such other companies to meet their obligations to us or to third parties, or any disputes with respect to the parties’ respective rights and obligations, could have a material adverse effect on the joint ventures or the property and therefore could have a material adverse effect on our results of operations, financial performance, cash flows and the price of the ADSs.
Failure to comply with applicable laws or regulations could materially and adversely affect our business, financial condition, and prospects.
We are subject to significant laws and regulations that affect our operations and costs of conducting our business, including those with respect to prospecting, mine development, transport, export, taxation, labor standards, occupational health, waste disposal, toxic substances, land use, environmental protection, mine safety, and other matters. We believe that we are in compliance with all material laws and regulations that currently apply to our activities, but there can be no assurance that we can continue to remain in compliance.
Changes in existing laws and regulations, the implementation of future laws and regulations, or more stringent implementation of such laws and regulations could have a material adverse impact on our business and cause increases in capital expenditures or require abandonment or delays in exploration. For example, a number of governments or governmental bodies have introduced or are contemplating legislative and/or regulatory changes in response to concerns about the potential impact of climate change. Legislation and increased regulation regarding climate change could impose significant costs on us, on our future joint venture partners, if any, and on our suppliers, including costs related to increased energy requirements, capital equipment, environmental monitoring and reporting, and other costs necessary to comply with such regulations. Any adopted future climate change regulations could also negatively impact our ability to compete with companies situated in areas not subject to such limitations. Given the emotional and political significance and uncertainty surrounding the impact of climate change and how it should be dealt with, we cannot predict how legislation and regulation will ultimately affect our financial condition, operating performance, and ability to compete. Furthermore, even without such regulation, increased awareness and any adverse publicity in the global marketplace about potential impacts on climate change by us or other companies in our industry could harm our reputation. The potential physical impacts of climate change on our operations are highly uncertain, could be particular to the geographic circumstances in areas in which we operate and may include changes in rainfall and storm patterns and intensities, water shortages, changing sea levels, and changing temperatures.
Failure to comply with applicable laws or regulations may result in enforcement actions, including the forfeiture of mineral claims or other mineral tenures, orders issued by regulatory or judicial authorities requiring operations to cease or be curtailed, and corrective measures requiring capital expenditures, installation of additional equipment, or costly remedial actions.
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Adverse global and local economic, political, and environmental conditions could negatively impact our ability to advance our exploration and development activities and our financial performance.
Our business is subject to risks arising from adverse economic, political, and environmental conditions in Malawi and globally. General economic conditions, including inflationary pressures, rising interest rates, changes in tax laws, new or restrictive legislation, trade barriers, and currency exchange controls or volatility, may negatively affect our operating costs, access to capital, and overall financial performance. National and international political developments, such as outbreaks of hostilities, war, terrorism, sabotage, subversive activities, security operations, labor unrest, civil disorder, or states of emergency, may disrupt supply chains, impede the movement of people or equipment, or restrict our ability to carry out mining exploration and development activities.
In addition, natural disasters, including fires, earthquakes and floods, as well as quarantine restrictions, epidemics, and pandemics, may adversely impact our operations and personnel, delay our exploration and development programs, and impair our ability to fund those activities. Even if our operational performance is not directly affected, broad economic or market volatility may adversely affect the value of our company and the trading price of our securities. These factors, individually or in the aggregate, could materially and adversely affect our business, results of operations, financial condition, and prospects.
Metal price volatility could have dramatic effects on the results of operations and our ability to execute our business plan.
If we achieve success leading to mineral production, our future revenues, if any, will be derived from the extraction and sale of HMS and REE. The price of these metals can be highly volatile and is affected by numerous factors beyond our control, including supply and demand fluctuations for precious and base metals, increased production due to new extraction developments and improved extraction and production methods, economic and political trends, inflation, currency exchange fluctuations, interest rates, global and regional consumptive patterns, and speculative activities such as forward selling. If a profitable market for our metals does not exist, the economic viability of our business, our ability to secure financing, and our results of operations will be materially and adversely affected.
Government actions, including tariffs, export controls, and foreign policy measures, could adversely and unexpectedly impact our business.
Government policies relating to trade, national security, and critical minerals could materially affect our exploration, development, and potential future sale of HMS and REE products. Several jurisdictions, including the United States, the European Union, and China, have implemented or proposed tariffs, export controls, quotas, and other trade restrictions relating to critical minerals and strategic materials. Any such measures may affect the availability and cost of mining equipment, processing technologies, reagents, and other imported inputs required for our exploration and any future development activities.
In addition, REEs and certain HMS products are increasingly viewed as strategically sensitive materials, and shifts in foreign policy or national security priorities could impose restrictions or additional compliance requirements on cross-border sales or exports. Such measures could limit potential customer markets, increase regulatory complexity, or create delays or uncertainties in obtaining necessary approvals for the movement of materials.
Escalating geopolitical tensions or retaliatory trade actions among major economies could also disrupt global supply chains, reduce demand for critical minerals, or negatively affect pricing. Broader macroeconomic impacts, including reduced global growth, tightening capital markets, or increased risk premiums, could in turn limit our ability to raise capital required to fund exploration and development activities. Any of these governmental or geopolitical actions could materially adversely affect our business, financial condition, results of operations, and prospects.
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We are exposed to significant foreign currency exchange rate risks, which could adversely affect our business, financial condition, and prospects.
The Australian dollar is our presentation currency, but we also conduct transactions and hold financial assets and liabilities denominated in currencies other than our presentational currency. In particular, international prices of various commodities are denominated in United States dollars. As a result, we are exposed to foreign exchange rate fluctuations. As of June 30, 2025, we had foreign currency-denominated financial assets of A$16,931, all of which were denominated in Malawi Kwacha, and foreign currency-denominated financial liabilities of A$2,408,896, approximately 67% of which were denominated in Euros, resulting in net foreign currency liabilities of A$2,391,965 (compared to A$2,067,773 as of June 30, 2024).
Foreign exchange fluctuations, whether arising from macroeconomic volatility, local currency instability, or the relative strength of the Australian dollar, could materially affect our operating expenses, financial results, and the carrying value of our assets and liabilities. These risks may also adversely impact our liquidity and our ability to fund exploration and development activities.
Our insurance coverage may be inadequate to protect against all risks associated with mineral exploration and production.
We currently maintain commercial general liability insurance and umbrella liability insurance against these operating hazards, in connection with our exploration program. However, insurance of all risks associated with mineral exploration and production is not always available and where available the costs can be prohibitive. In certain circumstances, our insurance may not be of the nature or level to provide adequate insurance cover. The occurrence of an event that is not covered or fully covered by insurance and the payment of any liabilities that arise from any such occurrence that would not otherwise be covered under the current insurance policies could have a material adverse effect on our business, financial condition and results of operations.
We may experience difficulty attracting and retaining qualified management to meet the needs of our anticipated growth, and the failure to manage our growth effectively could have a material adverse effect on our business, financial condition, and prospects.
The responsibility of overseeing the day-to-day operations and our strategic management depends substantially on our senior management and key personnel in Australia and Malawi. The loss of the services of any of these people could have a materially adverse effect on our business and prospects. There is no assurance we can maintain the services of our officers, directors, or other qualified personnel required to operate our business, or be able to find replacements with equivalent expertise and experience within a reasonable period of time, at acceptable costs, or at all.
As our business activity grows, we will require additional key financial, administrative and mining personnel as well as additional operations staff. The Project is located in an area with active mining activities, and we compete with other companies for personnel and talent. There can be no assurance that we will be successful in attracting, training, and retaining qualified personnel as competition for people with these skill sets increases. If we are not successful in attracting, training and retaining qualified personnel, the efficiency of our operations could be impaired, which could have an adverse impact on our business, financial condition, and prospects.
We may be subject to potential conflicts of interest with our directors and/or officers.
Alexander Shaw, our Chairman, and Manuel Mota, our Non-Executive Director, are directors of Luso Global Mining BV, our largest shareholder and a fully owned subsidiary of Mota-Engil SGPS, S.A. Cadell Buss, our Chief Executive Officer and Managing Director, José Martins, our Non-Executive Director, and Mark Laybourn, our Chief Financial Officer, also have roles at other companies that may give rise to conflicts of interest and impose restrictions on the time and effort they can spend on our business. Any failure of our directors or officers to address these conflicts in an appropriate manner or to allocate opportunities that they become aware of to us could have a material adverse effect on our business, financial condition, and prospects.
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Our operations may be subject to litigation or other claims.
From time to time, our operations may be subject to disputes that may result in litigation or other legal claims, including, without limitation, native title claims, tenure disputes, environmental claims, occupational health and safety claims and employee claims. We may be required to take countermeasures or defend against these claims, which will divert resources and management time from operations. Any costs involved in defending or settling legal and other claims or disputes that may arise, or where a claim or dispute is proven, could be costly and may impact adversely on our operations, financial performance and financial position and/or cause damage to our reputation.
Our operations are dependent on information technology systems that may be subject to network disruptions.
Our operations depend on information technology (“IT”) systems. These IT systems could be subject to network disruptions caused by a variety of sources, including computer viruses, security breaches and cyber-attacks, as well as disruptions resulting from incidents such as cable cuts, damage to physical plants, natural disasters, terrorism, fire, power loss, vandalism and theft. Our operations also depend on the timely maintenance, upgrade and replacement of networks, equipment, IT systems and software, as well as pre-emptive expenses to mitigate the risks of failures. Any of these and other events could result in information system failures, delays and/or increase in capital expenses. The failure of information systems or a component of information systems could, depending on the nature of any such failure, adversely impact our reputation and results of operations.
Although to date we have not experienced any material losses relating to cyber-attacks or other information security breaches, there can be no assurance that we will not incur such losses in the future. Our risk and exposure to these matters cannot be fully mitigated because of, among other things, the evolving nature of these threats. As a result, cyber security and the continued development and enhancement of controls, processes and practices designed to protect systems, computers, software, data and networks from attack, damage or unauthorized access remain a priority. As cyber threats continue to evolve, we may be required to expend additional resources to continue to modify or enhance protective measures or to investigate and remediate any security vulnerabilities.
The exploration and development of our projects may not be profitable.
The exploration for and development of mineral deposits involves significant risks, which even a combination of careful evaluation, experience and knowledge may not eliminate. While the discovery of a mineral deposit may result in substantial rewards, few properties that are explored are ultimately developed into producing mines. Major expenses may be required to locate and establish mineral resources and reserves, to develop metallurgical processes and to construct mining and processing facilities and infrastructure at a particular site. It is impossible to ensure that the exploration or development programs planned by us will result in a profitable commercial mining operation. Whether a mineral deposit will be commercially viable depends on a number of factors, some of which are: the particular attributes of the deposit, such as size, grade and proximity to infrastructure, heavy mineral sands and rare earth elements prices and government regulations, including regulations relating to prices, taxes, royalties, land tenure, land use, exporting of minerals and environmental protection. The exact effect of these factors cannot be accurately predicted, but the combination of these factors may result in our company not receiving an adequate return on invested capital. There is no certainty that the expenditures made towards the search and evaluation of mineral deposits will result in the discovery of mineral resources or the development of commercial quantities of mineral reserves.
Our exploration projects have no operating history upon which to base estimates of future capital and operating costs. Mineral resource and reserve estimates and estimates of operating costs are or will be, to a large extent, based upon the interpretation of geologic data obtained from drill holes and other sampling techniques, and technical reports and feasibility studies, which derive estimates of capital and operating costs based upon anticipated tonnage and grades to be mined and processed, ground conditions, the configuration of the deposit, expected recovery rates of minerals from ore, estimated operating costs, and other factors. As a result, actual production, cash operating costs and economic returns could differ significantly from those estimated.
Our business is subject to operational risks that are generally outside of our control and could adversely affect our business.
Mineral mining sites by their nature are subject to many operational risks and factors that are generally outside of our control and could adversely affect our business, operating results and cash flows.
These operational risks and factors include the following:
| ● | unanticipated ground and water conditions; |
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| ● | adverse claims to water rights and shortages of water to which we have rights; |
| ● | adjacent land ownership that results in constraints on current or future operations; |
| ● | geological problems, including earthquakes and other natural disasters; |
| ● | metallurgical and other processing problems; |
| ● | the occurrence of unusual weather or operating conditions and other force majeure events; |
| ● | lower than expected ore grades or recovery rates; |
| ● | accidents; |
| ● | delays in the receipt of or failure to receive necessary government permits; |
| ● | the results of litigation, including appeals of agency decisions; |
| ● | uncertainty of exploration and development; |
| ● | delays in transportation; |
| ● | interruption of energy supply; |
| ● | labor disputes; |
| ● | inability to obtain satisfactory insurance coverage; and |
| ● | the failure of equipment or processes to operate in accordance with specifications or expectations. |
Any one or more of these factors or other risks could cause us not to realize the anticipated benefits of an acquisition of properties or companies and could have a material adverse effect on our financial condition.
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There are numerous risks associated with the development of our property.
Our future success will largely depend upon our ability to successfully explore, develop and manage our property. In particular, our success is dependent upon management’s ability to implement our strategy, to develop the projects and to maintain ongoing production from the mines that we expect to develop.
Development of our property could be delayed, experience interruptions, incur increased costs or be unable to complete due to a number of factors, including but not limited to:
| ● | changes in the regulatory environmental compliance requirements; |
| ● | non-performance by third party consultants and contractors; |
| ● | inability to attract and retain a sufficient number of qualified workers; |
| ● | unforeseen escalation in anticipated costs of exploration and development, or delays in construction, or adverse currency movements resulting in insufficient funds being available to complete planned exploration and development; |
| ● | increases in extraction costs including energy, material and labor costs; |
| ● | lack of availability of mining equipment and other exploration services; |
| ● | shortages or delays in obtaining critical mining and processing equipment; |
| ● | catastrophic events such as fires, storms or explosions; |
| ● | the breakdown or failure of equipment or processes; |
| ● | construction, procurement and/or performance of the processing plant and ancillary operations falling below expected levels of output or efficiency; |
| ● | civil unrest in and/or around our exploration and mining sites and supply routes, which would adversely affect the community support of our operations; |
| ● | changes to anticipated levels of taxes and imposed royalties; and/or |
| ● | a material and prolonged deterioration in market conditions, resulting in material price erosion. |
It is not uncommon for new mining developments to experience these factors during their exploration or development stages or during construction, commissioning and production start-up, or indeed for such projects to fail as a result of one or more of these factors occurring to a material extent. There can be no assurance that we will complete the various stages of exploration and development necessary in order to achieve our strategy in the timeframe pre-determined by us or at all. Any of these factors could have a material adverse effect on our business, results of operations and activities, financial condition and prospects.
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Our property may face indigenous land claims.
Our property may now or in the future be the subject of indigenous land claims. The legal nature of land claims is a matter of considerable complexity. The impact of any such claim on our ownership interest in our properties cannot be predicted with any degree of certainty and no assurance can be given that a broad recognition of indigenous rights in the area in which our properties are located, by way of a negotiated settlement or judicial pronouncement, would not have an adverse effect on our operations. Even in the absence of such recognition, we could at some point be required to negotiate with and seek the approval of holders of such interests in order to facilitate exploration and development work on our property. There is no assurance that we would be able to establish a practical working relationship with an indigenous group in the area that would allow us to ultimately develop our properties.
Non-governmental organizations could seek to delay development of our projects.
Our relationship with the communities in which we operate is important to ensure the future success of our operations. Although we work with ESS (Environmental and Social Sustainability) Africa, a sustainability consulting company, to maintain good relationships with the communities in which we operate, there is an increasing level of public concern relating to the perceived effect of mining activities on the environment and on communities impacted by such activities. Certain non-governmental organizations (“NGOs”), some of which oppose resource development, are often vocal critics of the mining industry and its practices. Adverse publicity generated by such NGOs or others related to extractive industries generally, or its operations specifically, could have an adverse effect on our reputation or financial condition and may impact our relationship with the communities in which we operate. While we believe that we operate in a socially responsible manner, there is no guarantee that our efforts in this respect will mitigate this potential risk. There is a risk that NGOs could cause a delay in the development of our projects.
There can be no guarantee that our interests in our property are free from any title defects.
We have taken all reasonable steps to ensure that we have proper title to our property. However, there can be no guarantee that our interests in our property are free from any title defects, as title to mineral rights involves certain intrinsic risks due to the potential problems arising from the unclear conveyance history characteristic of many mining projects. There can be no assurance that our rights and title interests will not be challenged or impugned by third parties.
Land reclamation requirements may be burdensome.
Land reclamation requirements are generally imposed on companies with mining operations or mineral exploration companies in order to minimize long term effects of land disturbance. Reclamation may include requirements to control dispersion of potentially deleterious effluents or reasonably re-establish pre-disturbance land forms and vegetation. In order to carry out reclamation obligations imposed on us in connection with exploration, potential development and production activities, we must allocate financial resources that might otherwise be spent on exploration and development programs. If we are required to carry out unanticipated reclamation work, our financial position could be adversely affected.
Compliance with environmental regulations and litigation based on environmental regulations could require significant expenditures.
Environmental regulations mandate the maintenance of air and water quality standards, land development and land reclamation, and set forth limitations on the generation, transportation, storage and disposal of solid and hazardous waste. In connection with our current exploration activities or in connection with our prior extraction operations, we could incur environmental costs that could have a material adverse effect on financial condition and results of operations.
Any failure to remedy an environmental problem could require us to suspend operations or enter into interim compliance measures pending completion of the required remedy. Moreover, governmental authorities and private parties could bring lawsuits based upon damage to property and injury to persons resulting from the environmental, health and safety impacts of prior and current operations, including operations conducted by other extraction companies many years ago at sites located on properties that we currently own or formerly owned. We cannot assure you that any such law, regulation, enforcement or private claim would not have a material adverse effect on our financial condition, results of operations or cash flows. If we violate or fail to comply with applicable environmental laws and regulations, we could be subject to penalties, restrictions on operations or other sanctions. Such liability could materially adversely affect our reputation, business, results of operations and financial condition.
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The requirements of being a publicly traded company in the United States may strain our resources and divert management’s attention.
Upon listing on the Nasdaq Capital Market, we will become subject to the reporting requirements of the Exchange Act, the Sarbanes-Oxley Act, the listing requirements of the Nasdaq Capital Market and other applicable securities rules and regulations. Compliance with these rules and regulations will increase our legal and financial compliance costs, make some activities more difficult, time-consuming or costly and increase demand on our systems and resources. The Exchange Act requires that we file an annual report on Form 20-F. The Sarbanes-Oxley Act requires that we maintain effective disclosure controls and procedures and internal control over financial reporting. In order to maintain and, if required, improve our disclosure controls and procedures and internal control over financial reporting to meet this standard, significant resources and management oversight are required. As a result, management’s attention may be diverted from other business concerns, which could adversely affect our business and results of operations.
The Sarbanes-Oxley Act requires that we assess the effectiveness of our internal control over financial reporting annually and disclosure controls and procedures quarterly. If we identify further material weaknesses in future periods or we are not able to comply with the requirements of Section 404 in a timely manner, our reported financial results could be restated, we could be subject to investigations or sanctions by regulatory authorities, which would require additional financial and management resources, and the market price of our ordinary shares and ADSs could decline.
We could become subject to the auditor attestation requirement under the Sarbanes-Oxley Act even if we have little or no revenue, thus imposing significant cost and administrative burden on us.
We currently qualify as an “emerging growth company” and, as a result, are exempt from the auditor attestation requirement under Section 404 of the Sarbanes-Oxley Act of 2002 in the assessment of internal controls over financial reporting. We expect to remain an emerging growth company until the earlier of the last day of our fiscal year following the fifth anniversary of the completion of our first public offering in the United States or, as of the last business day of our most recently completed second fiscal quarter, our aggregate worldwide market value of the voting and non-voting common equity held by our non-affiliates is US$700 million or more. Once we cease to be an emerging growth company and the aggregate worldwide market value of our voting equity held by non-affiliates exceeds US$75 million as of our most recently completed second fiscal quarter, then we will be subject to the auditor attestation requirement in the assessment of the internal controls over financial reporting.
While the SEC has acknowledged the significant cost of the auditor attestation requirement for small companies and provided an exemption for U.S. “smaller reporting companies” with less than US$100 million in revenue, the SEC has decided not to similarly exempt foreign private issuers (such as the Company) unless they comply with the reporting requirements for U.S. companies, including presenting financial statements in accordance with U.S. generally accepted accounting principles. Given the significant cost and administrative burden resulting from inconsistent reporting obligations under the rules of the SEC and ASX, it may not be feasible for us to comply with the SEC’s reporting requirements for U.S. companies in the event we were to cease being an “emerging growth company” and have aggregate worldwide market value of our voting equity held by non-affiliates exceeding US$75 million.
In such event, we could be obligated to incur significant compliance costs and administrative burden given our limited number of personnel. If such costs were to become too significant, we could reconsider our listing on Nasdaq because, as the SEC has acknowledged, the savings for a small company could be put to more productive use such as developing the Company.
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We have identified material weaknesses in our internal control over financial reporting. Failure to effectively remediate these weaknesses, the emergence of additional material weaknesses, or a failure to maintain effective internal controls could impair our ability to produce timely and accurate financial statements and to comply with applicable laws and regulations.
In connection with the preparation of the financial statements included in this prospectus, we identified material weaknesses in our internal control over financial reporting. A material weakness is a deficiency, or combination of deficiencies, in internal control over financial reporting such that there is a reasonable possibility that a material misstatement of our financial statements will not be prevented or detected on a timely basis. These material weaknesses relate to deficiencies in the design and implementation of controls are summarized below:
| ● | the Company did not adequately establish, implement, or oversee IT general controls relating to system changes, access management, and segregation of duties across systems that support most financial reporting processes. As a result, automated controls are ineffective, and any manual controls that rely on system-generated information were inappropriately relied upon; |
| ● | the Company did not design or implement controls with sufficient precision to enable effective oversight of business processes and the related control activities; and |
| ● | the Company did not develop, implement, or consistently maintain formal accounting policies, procedures, and control documentation across the majority of its processes to ensure financial information is recorded, reported, and disclosed in a timely, complete, and accurate manner. |
We believe these material weaknesses resulted, in part, due to the fact that we are a small company with limited resources for addressing internal controls over financial reporting and the controls in place have been more aligned with the operational risks of the business and to address the risk of material fraudulent transactions.
Management has commenced a process to understand the required level of internal control and committed to implementing appropriate remedial actions and initiatives to expand our resources and strengthen the control environment.
We may be unable to fully remediate these material weaknesses until the remediation measures have been fully implemented and our internal controls have operated effectively for a sufficient period of time. In addition, we cannot predict whether our remediation efforts will be successful or determine the results of any future evaluation of such efforts at this time. Further, we are not currently required to comply with the SEC rules in implementing Section 404 of the Sarbanes-Oxley Act of 2002 and, therefore, are not required to perform a formal assessment of the effectiveness of our internal control over financial reporting. As a result, we cannot provide assurance that we have identified all material weaknesses or that additional material weaknesses will not be identified in the future.
Risks Relating to Ownership of the ADSs, Warrants and this Offering
The trading price of the ADSs may be volatile, and purchasers of the ADSs could incur substantial losses.
The market price of our ordinary shares historically has been, and we expect our ordinary shares and ADSs will continue to be, subject to significant fluctuations over short periods of time. These fluctuations may be due to factors specific to us, to changes in analysts’ recommendations and earnings estimates, to arbitrage between our Australian-listed ordinary shares and our Nasdaq-listed ADSs, to changes in exchange rates, or to factors affecting the mining and exploration industry or the securities markets in general. Market fluctuations, as well as general political and economic conditions, such as a recession, interest rate or currency fluctuations, could adversely affect the market price of our securities.
We may experience a material decline in the market price of our shares, regardless of our operating performance. Therefore, a holder of ADSs may not be able to sell those ADSs at or above the price paid by such holder for such ADSs. Price declines in the ADSs could result from a variety of factors, including many outside our control. These factors include:
| ● | the results of our exploration and development activities; |
| ● | regulatory actions in respect of any of our exploration and development activities; |
| ● | market conditions, including market conditions in the mineral sands and rare earths sectors; |
| ● | increases in our costs or decreases in our revenues due to unfavorable movements in foreign currency exchange rates; |
| ● | litigation or public concern about the safety of our exploration and development activities; |
| ● | changes in recommendations or earnings estimates by securities analysts; |
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| ● | actual and anticipated fluctuations in our quarterly operating results; |
| ● | deviations in our operating results from the estimates of securities analysts; |
| ● | rumors relating to us or our competitors; |
| ● | additions or departures of key personnel; and |
| ● | developments concerning current or future strategic alliances or acquisitions. |
In addition, volatility and low market price of the ADSs may adversely impact investors’ interest in our securities. A decline in investors’ interest may prompt further volatility and decrease in market price.
There has been no prior market for the ADSs and an active and liquid market for our securities may fail to develop, which could harm the market price of the ADSs.
While our ordinary shares have been listed on the Australian Securities Exchange, or ASX, prior to this offering, there has been no public market on a U.S. national securities exchange for our ordinary shares or ADSs. Although we have applied for the listing of the ADSs on Nasdaq, an active trading market for the ADSs may never develop or be sustained following this offering. The initial offering price of the ADSs will be determined through negotiations between us and the underwriter and will be based, in part, on prevailing market prices of our ordinary shares on the ASX, after taking into account market conditions and other factors. This offering price may not be indicative of the market price of the ADSs after this offering. In the absence of an active trading market for the ADSs, investors may not be able to sell their ADSs at or above the offering price or at the time that they would like to sell.
If we are or become a passive foreign investment company (“PFIC”), then that would subject our U.S. investors to adverse tax rules.
Holders of ADSs who are U.S. taxpayers will be subject to particular income tax rules if we are a passive foreign investment company, or PFIC. These rules could result in a reduction in the after-tax return to a “U.S. Holder” of the ADSs and reduce the value of the ADSs. For U.S. federal income tax purposes, we will be classified as a PFIC for any taxable year in which (i) 75% or more of our gross income is passive income, or (ii) at least 50% of the average value of all of our assets for the taxable year produce or are held for the production of passive income. For this purpose, cash is considered to be an asset that produces passive income.
If we are classified as a PFIC in any year that a U.S. Holder owns ADSs, the U.S. Holder will generally continue to be treated as holding ADSs of a PFIC in all subsequent years, notwithstanding that we are not classified as a PFIC in a subsequent year. Dividends received by the U.S. Holder and gains realized from the sale of the ADSs would be taxed as ordinary income and subject to an interest charge. We urge U.S. investors to consult their own tax advisors about the application of the PFIC rules and certain elections that may help to minimize adverse U.S. federal income tax consequences in their particular circumstances.
You will experience immediate and substantial dilution in the net tangible book value of the ADSs and Warrants you purchase in this offering.
The initial public offering price of the ADSs and accompanying Warrants is substantially higher than the net tangible book value per ADS or per ordinary share immediately after this offering. If you purchase ADSs and accompanying Warrants in this offering, you will suffer immediate dilution of US$3.05 per ADS, or US$3.02 per ADS if the underwriter exercises its option to purchase additional shares in full, representing the difference between our as adjusted net tangible book value per ADS or per ordinary share after giving effect to the sale of ADSs in this offering and the initial public offering price of US$5.00 per ADS. See “Dilution.”
Our issuance of additional ordinary shares in connection with financings, acquisitions, investments, or otherwise will dilute all other ADS holders.
We expect to issue additional ordinary shares in the future that will result in dilution to all other ADS holders. We may also raise capital through equity financings in the future. As part of our business strategy, we may acquire or make investments in complementary companies, products, or technologies and issue equity securities to pay for any such acquisition or investment. While we will be subject to the constraints of the ASX Listing Rules regarding the percentage of our capital that we are able to issue within a 12-month period (subject to applicable exceptions), any such issuances of additional ordinary shares may cause ADS holders to experience significant dilution of their ownership interests and the per ADS value of the ADSs to decline.
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As long as we remain subject to the rules of the ASX and Nasdaq, we will be unable to access equity capital without shareholder approval if such equity capital sales would result in an equity issuance above regulatory thresholds and, consequently, we could be unable to obtain financing sufficient to sustain our business if we are unsuccessful in soliciting requisite shareholder approvals.
Our ability to access equity capital is currently limited by ASX Listing Rule 7.1, which provides that a company must not, subject to specified exceptions (including approval by shareholders), issue or agree to issue during any consecutive 12-month period any equity securities, or other securities with rights to conversion to equity, if the number of those securities in aggregate would exceed 15% (or 25% if approved in advance by shareholders in certain circumstances) of the number of ordinary securities on issue at the commencement of that 12-month period.
Our equity issuances will be limited by ASX Listing Rule 7.1 as long as we continue to be listed on the ASX and this constraint may prevent us from raising the full amount of equity capital needed for operations without prior shareholder approval.
We have broad discretion in the use of the net proceeds from this offering and may not use them effectively.
We will have broad discretion in the application of the net proceeds that we receive from this offering as well as of our existing cash, and we may spend or invest these funds in a way with which our shareholders or holders of the ADSs disagree. Our failure to apply these funds effectively could harm our business and financial condition. Pending their use, we may invest the net proceeds from the offering in a manner that does not produce income or that loses value. These investments may not yield a favorable return to our investors.
Future sales of ordinary shares or ADSs by existing holders could depress the market price of the ordinary shares or ADSs.
Based on 98,006,092 ordinary shares outstanding as of June 30, 2026, upon the closing of this offering, we will have outstanding a total of ordinary shares (including ordinary shares represented by ADSs), assuming no exercise of the underwriters’ option to purchase additional ADSs and Warrants and no exercise of outstanding Warrants offered and sold in this offering. Each member of our senior management and board of directors and their affiliates are subject to lock-up agreements with the underwriters that restrict their ability to transfer ordinary shares, options and other securities convertible into, exchangeable for, or exercisable for ordinary shares during the period ending on, and including, the 180th day after the date of this prospectus, subject to specified exceptions. Maxim Group LLC may, in its sole discretion, permit our shareholders who are subject to these lock-up agreements to sell securities prior to the expiration of the lock-up agreements.
After the lock-up agreements pertaining to this offering expire, additional ordinary shares will be eligible for sale in the public market, all of which ordinary shares are held by members of our senior management and board of directors. In addition, the ordinary shares subject to subscription under outstanding options exercisable for ordinary shares will become eligible for sale in the public market in the future, subject to certain legal and contractual limitations. Sales of a large number of the ordinary shares in the public market could depress the market price of the ADSs. See “Shares and American Depositary Shares Eligible for Future Sale” for a more detailed description of sales that may occur in the future. If these additional ordinary shares are sold, or if it is perceived that they will be sold, in the public market, the trading price of the ordinary shares and ADSs could decline substantially, which could impair our ability to raise additional capital through the issuance of ordinary shares, ADSs or other securities in the future.
The dual listing of our ordinary shares and the ADSs following this offering may negatively impact the liquidity and value of the ADSs.
Following this offering and after the ADSs are listed on Nasdaq, our ordinary shares will continue to be listed on the ASX. We cannot predict the effect of this dual listing on the value of our ordinary shares and ADSs. However, the dual listing of our ordinary shares and ADSs may dilute the liquidity of these securities in one or both markets and/or may negatively impact the development of an active trading market for the ADSs in the United States. The price of the ADSs could also be negatively impacted by trading in our ordinary shares on the ASX.
We are subject to risks associated with currency fluctuations, and changes in foreign currency exchange rates could impact our results of operations.
Our ordinary shares are quoted in Australian dollars on the ASX and the ADSs will be quoted in U.S. dollars. Any significant change in the value of the Australian dollar may have a negative effect on the value of the ADSs in U.S. dollars. In addition, if the Australian dollar weakens against the U.S. dollar, then, if we decide to convert our Australian dollars into U.S. dollars for any business purpose, appreciation of the U.S. dollar against the Australian dollar would have a negative effect on the U.S. dollar amount available to us. To the extent that we need to convert U.S. dollars we receive from this offering into Australian dollars for our operations, appreciation of the Australian dollar against the U.S. dollar would have a negative effect on the Australian dollar amount we would receive from the conversion. Consequently, appreciation or depreciation in the value of the Australian dollar relative to the U.S. dollar would affect our financial results reported in U.S. dollar terms without giving effect to any underlying change in our business or results of operations. As a result of such foreign currency fluctuations, it could be more difficult to detect underlying trends in our business and results of operations.
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The Warrants are a risky investment. You may be unable to exercise your Warrants for a profit.
The amount paid for the ADSs in this offering in excess of the value of our ADSs represents the value of your investment in the Warrants. The value of the Warrants will depend on the value of our ADSs, which will depend on factors related and unrelated to the success of our exploration activities, and cannot be predicted at this time. The Warrants have an exercise period of 5 years.
If the price of our ADSs does not increase to an amount sufficiently above the exercise price of the Warrants during the exercise period of the Warrants, you may be unable to recover any of your investment in the Warrants. In addition, because we are an Australian corporation, the anti-dilution adjustments included in the Warrants are limited to those permitted by the rules of the ASX. As a result, the Warrants do not include any value-weighted average price or similar adjustment provision for issuances of ADSs at a price below the exercise price of the Warrants or the market price of our ADSs or ordinary shares. There can be no assurance that any of the factors that could impact the trading price of our ADSs will result in the trading price increasing to an amount that will exceed the exercise price or the price required for you to achieve a positive return on your investment in the Warrants.
There is no public market for the Warrants being offered in this offering.
There is no established public trading market for the Warrants being offered in this offering, and we do not expect a market to develop. In addition, we do not intend to apply to list the Warrants on any securities exchange or nationally recognized trading system. Without an active market, the liquidity of the Warrants will be limited.
ADS and Warrant holders are not shareholders and do not have shareholder rights.
The Bank of New York Mellon, as depositary, registers and delivers the American Depositary Shares, or ADSs. ADS and Warrant holders will not be treated as shareholders and do not have the rights of shareholders. The depositary will be the holder of the shares underlying the ADSs. Holders of the ADSs will have ADS holder rights. A deposit agreement among us, the depositary and ADS holders, and the beneficial owners of ADSs, sets out ADS holder rights as well as the rights and obligations of the depositary. New York law governs the deposit agreement and the ADSs. For a description of ADS holder rights, see “Description of Securities” in this Registration Statement.
Our shareholders have shareholder rights. Australian law and our constitution govern shareholder rights. For a description of our shareholders’ rights, see “Memorandum and Articles of Association” in this Registration Statement. Shareholders are entitled to our notices of general meetings and to attend and vote at our general meetings of shareholders. At a general meeting, every shareholder present (in person or by proxy, attorney or representative) and entitled to vote has one vote on a show of hands. Every shareholder present (in person or by proxy, attorney or representative) and entitled to vote has one vote per fully paid ordinary share on a poll. This is subject to any other rights or restrictions which may be attached to any shares.
ADS holders do not have the same voting rights as our shareholders. ADS holders may exercise voting rights with respect to the underlying ordinary shares only in accordance with the provisions of the deposit agreement. Under the deposit agreement, ADS holders vote by giving voting instructions to the depositary. Upon receipt of instructions, the depositary will try to vote in accordance with those instructions. Otherwise, ADS holders will not be able to vote unless they withdraw the ordinary shares underlying their ADSs.
If we ask for ADS holders’ instructions, the depositary will notify ADS holders of the upcoming vote and arrange to deliver our voting materials and form of notice to them. The depositary will try, as far as practical, subject to Australian law and the provisions of the depositary agreement, to vote the shares as the ADS holders instruct. The depositary will not vote or attempt to exercise the right to vote other than in accordance with the instructions of the ADS holders. We cannot assure ADS holders that they will learn of ordinary shareholders’ meetings and receive the voting materials in time to instruct the depositary or withdraw the underlying ordinary shares. This means that there is a risk that ADS holders may not be able to exercise voting rights and there may be nothing they can do if their shares are not voted as they requested.
ADS holders do not have the same rights to receive dividends or other distributions as our shareholders.
Subject to any special rights or restrictions attached to a share, the directors may determine that a dividend will be payable on a share and fix the amount, the time for payment and the method for payment (although we have never declared or paid any cash dividends on our ordinary shares and we do not anticipate paying any cash dividends in the foreseeable future). Dividends may be paid on shares of one class but not another and at different rates for different classes. Dividends and other distributions payable to our shareholders with respect to our ordinary shares generally will be payable directly to them. Any dividends or distributions payable with respect to ordinary shares will be paid to the depositary, which has agreed to pay to ADS holders the cash dividends or other distributions it or the custodian receives on shares or other deposited securities, after deducting its fees and expenses and any taxes or other governmental charges. ADS holders will receive these distributions in proportion to the number of shares their ADSs represent. However, the depositary is not responsible if it decides that it is unlawful or impractical to make a distribution available to any holders of ADSs. For example, it would be unlawful to make a distribution to a holder of ADSs if it consists of securities that require registration under the Securities Act of 1933, as amended (the “Securities Act”) but that are not properly registered or distributed under an applicable exemption from registration. The depositary may also determine that it is not feasible to distribute certain property through the mail. Additionally, the value of certain distributions may be less than the cost of distributing them. In these cases, the depositary may determine not to distribute such property. We have no obligation to register under U.S. securities laws any ADSs, ordinary shares, rights or other securities received through such distributions. We also have no obligation to take any other action to permit the distribution of ADSs, ordinary shares, rights or anything else to holders of ADSs. This means that you may not receive distributions we make on our ordinary shares or any value for them if it is illegal or impractical for us to make them available to you. These restrictions may cause a material decline in the value of the ADSs.
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There are circumstances where it may be unlawful or impractical to make distributions to the holders of the ADSs.
The deposit agreement with the depositary generally requires the depositary to convert foreign currency it receives in respect of deposited securities into U.S. dollars and distribute the U.S. dollars to ADS holders, provided the depositary can do so on a reasonable basis. If it does not convert foreign currency, the depositary may distribute the foreign currency only to those ADS holders to whom it is possible to do so. If a distribution is payable by us in Australian dollars, the depositary will hold the foreign currency it cannot convert for the account of the ADS holders who have not been paid. It will not invest the foreign currency and it will not be liable for any interest. If the exchange rates fluctuate during a time when the depositary cannot convert the foreign currency, ADS holders may lose some of the value of the distribution. The depositary is not responsible if it decides that it is unlawful or impractical to make a distribution available to any ADS holders. This means that ADS holders may not receive the distributions we make on our shares or any value for them if it is illegal or impractical for us to make them available.
Risks Relating to Our Location in Australia
Australian takeovers laws may discourage takeover offers being made for us or may discourage the acquisition of large numbers of our shares.
We are incorporated in Australia and are subject to the takeover laws of Australia. Amongst other things, we are subject to the Corporations Act 2001 (Commonwealth of Australia) (“Corporations Act”). Subject to a range of exceptions, the Corporations Act prohibits the acquisition of a direct or indirect interest in our issued voting shares (including through the acquisition of ADSs) if the acquisition of that interest will lead to a person’s or someone else’s voting power in us increasing from 20% or below to more than 20% or increasing from a starting point that is above 20% and below 90%. Exceptions to the general prohibition include circumstances where the person makes a formal takeover bid for us, if the person obtains shareholder approval for the acquisition or if the person acquires less than 3% of the voting power of us in any rolling six-month period. Australian takeovers laws may discourage takeover offers being made for us or may discourage the acquisition of large numbers of our shares.
Holders of our ordinary shares or ADSs may have difficulty enforcing United States securities laws.
Holders of our ordinary shares or ADSs may have difficulties enforcing, in actions brought in courts in jurisdictions located outside the U.S., liabilities under U.S. securities laws. In particular, if such a holder sought to bring proceedings in Australia based on U.S. securities laws, the Australian court might consider:
| ● | that it did not have jurisdiction; and/or |
| ● | that it was not an appropriate forum for such proceedings; and/or |
| ● | that, applying Australian conflict of laws rule, U.S. law (including U.S. securities laws) did not apply to the relationship between holders of our ordinary shares or ADSs and us or our directors and officers; and/or |
| ● | that the U.S. securities laws were of a public or penal nature and should not be enforced by the Australian court. |
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As a foreign private issuer whose shares are listed on the Nasdaq Capital Market, we may follow certain home country corporate governance practices instead of certain Nasdaq requirements.
As an Australian company and a foreign private issuer whose shares will be listed on the Nasdaq Capital Market, we will be permitted to follow certain home country corporate governance practices instead of certain requirements of The Nasdaq Marketplace Rules. This includes, among other things, the composition of the board of directors, director nomination process, compensation of officers and quorum at shareholders’ meetings. In addition, we may follow Australian law instead of the Nasdaq Marketplace Rules that require that we obtain shareholder approval for certain dilutive events, such as for the establishment or amendment of certain equity based compensation plans, an issuance that will result in a change of control of the Company, certain transactions other than a public offering involving issuances of a 20% or more interest in the Company and certain acquisitions by us of the shares or assets of another company. As a foreign private issuer, we have elected to follow certain home country practices instead of Nasdaq requirements. Accordingly, our shareholders may not be afforded the same protection as provided under Nasdaq’s corporate governance rules that are applicable to U.S. companies.
As a foreign private issuer, we are exempt from a number of rules under the U.S. securities laws and are permitted to file less information with the SEC than a U.S. company.
We are a foreign private issuer (as defined in the SEC’s rules) and, consequently, we are not subject to all of the disclosure requirements applicable to public companies organized within the United States. For example, we are exempt from certain rules under the Exchange Act that regulate disclosure obligations and procedural requirements related to the solicitation of proxies under the Exchange Act. In addition, our senior management and directors are exempt from the “short-swing” profit recovery provisions of Section 16 of the Exchange Act and related rules with respect to their purchases and sales of our securities. Moreover, while we currently make annual and semi-annual filings with respect to our listing on the ASX and expect to file financial reports on an annual and semi-annual basis, we will not be required to file periodic reports and financial statements with the SEC as frequently or as promptly as U.S. public companies and will not be required to file quarterly reports on Form 10-Q or current reports on Form 8-K under the Exchange Act. In addition, foreign private issuers are not required to file their annual report on Form 20-F until four months after the end of each fiscal year. Accordingly, there may be less publicly available information concerning our company than there would be if we were not a foreign private issuer.
U.S. investors may have difficulty enforcing civil liabilities against our company, our directors or members of senior management and the experts named in this prospectus.
Certain members of our senior management and board of directors named in this prospectus are non-residents of the United States, and a substantial portion of the assets of such persons are located outside the United States. As a result, it may be impracticable to serve process on such persons in the United States or to enforce judgments obtained in U.S. courts against them based on civil liability provisions of the securities laws of the United States. Even if you are successful in bringing such an action, there is doubt as to whether Australian courts would enforce certain civil liabilities under U.S. securities laws in original actions or judgments of U.S. courts based upon these civil liability provisions. In addition, awards of punitive damages in actions brought in the United States or elsewhere may be unenforceable in Australia or elsewhere outside the United States. An award for monetary damages under U.S. securities laws would be considered punitive if it does not seek to compensate the claimant for loss or damage suffered and is intended to punish the defendant. The enforceability of any judgment in Australia will depend on the particular facts of the case as well as the laws and treaties in effect at the time. The United States and Australia do not currently have a treaty or statute providing for recognition and enforcement of the judgments of the other country (other than arbitration awards) in civil and commercial matters.
As a result, our public shareholders may have more difficulty in protecting their interests through actions against us, our management or our directors than would shareholders of a corporation incorporated in a jurisdiction in the United States. In addition, as a company incorporated in Australia, the provisions of the Australian Corporations Act regulate the circumstances in which shareholder derivative actions may be commenced which may be different, and in many ways less permissive, than for companies incorporated in the United States.
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We estimate that the net proceeds to us from the sale of 800,000 ADSs and 800,000 Warrants in this offering will be approximately US$2.9 million (or approximately US$3.5 million if the underwriter exercises its option to purchase additional ADSs and Warrants in full), based on the assumed initial public offering price of US$5.00 per ADS, after giving effect to the ADS-to-ordinary share ratio of 1-to-10, after deducting underwriting discounts and commissions and estimated offering expenses payable by us. The foregoing assumes that none of the Warrants (including any Warrants issued if the underwriter’s option to purchase additional Warrants is exercised in full) issued in the offering are exercised. If all the Warrants were to be exercised in cash, we would receive additional proceeds of approximately US$ million. We cannot predict when or if these Warrants will be exercised. It is possible that these Warrants may expire and may never be exercised.
We expect to use the net proceeds from this offering, together with our existing cash, to further our mineral exploration activities, for working capital and other general corporate purposes. In particular, we expect to use (i) approximately 70% of the net proceeds for mineral exploration activities, including for exploration drilling, geological field programs, metallurgical test work, environmental baseline studies, permitting, community engagement, and site infrastructure at our Chilwa Critical Minerals Project, (ii) approximately 20% of the net proceeds for working capital, including for day-to-day corporate operations, including payments to employees, office administration costs, insurance costs, travel costs, Nasdaq listing maintenance fees, transfer agent fees and ongoing legal and audit retainers and (iii) approximately 10% of the net proceeds for general corporate purposes, including additional tenement applications, preliminary studies on adjacent prospects, and any unforeseen regulatory or compliance costs. However, due to the uncertainties inherent in the mineral exploration process, it is difficult to estimate with certainty the exact amounts of the net proceeds from this offering that may be used for the above purposes. Our management will have broad discretion over the use of the net proceeds from this offering. The amounts and timing of our expenditures will depend upon numerous factors including the results of our mineral exploration activities, timing and success of the feasibility activities we may commence in the future and the amount of cash obtained through future collaborations, if any.
As of June 30, 2026, we had cash of A$1.1 million (or US$0.8 million, giving effect to the Australian dollar/U.S. dollar exchange rate of 0.6869 as of June 30, 2026). We believe our cash, together with the net proceeds of this offering, will be sufficient to fund our operations until July 31, 2027. In particular, we estimate that such funds, together with such existing cash, will be sufficient to enable us to advance our exploration activities.
Pending our use of the net proceeds from this offering, we intend to invest the net proceeds in a variety of capital preservation investments, including short-term, investment-grade, interest-bearing instruments.
We have never declared or paid any dividends on our ordinary shares. We intend to retain any earnings for use in our business and do not currently intend to pay cash dividends on our ordinary shares. Dividends, if any, on our outstanding ordinary shares will be declared by and subject to the discretion of our board of directors, and subject to Australian law.
Any dividend we declare will be paid to the holders of ADSs, subject to the terms of the deposit agreement, to the same extent as holders of our ordinary shares, to the extent permitted by applicable law and regulations, less the fees and expenses, taxes or other governmental charges payable under the deposit agreement. Any dividend we declare will be distributed by the depositary to the holders of the ADSs, subject to the terms of the deposit agreement. See “Description of Securities – American Depositary Shares — Dividends and Other Distributions.”
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The following table sets forth our cash and our capitalization as of December 31, 2025, on:
| ● | an actual basis; |
| ● | on an adjusted basis to give effect to the sale of 1,708,527 ordinary shares that raised gross proceeds of A$2.05 million in January 2026; and |
| ● | a pro forma as adjusted basis to give effect to the issuance and sale of 800,000 ADSs and 800,000 Warrants in this offering at the assumed initial public offering price of US$5.00 per ADS, after deducting underwriting discounts and commissions and estimated offering expenses payable by us. |
You should read this information in conjunction with our consolidated financial statements and the related notes included elsewhere in this prospectus, the information set forth in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and other financial information contained elsewhere in this prospectus.
| As of December 31, 2025 (unaudited) | ||||||||||||||||||||
| Actual(1) | As Adjusted(1) | Pro
Forma As Adjusted(2)(3) | ||||||||||||||||||
| (in A$ or US$, except share data) | ||||||||||||||||||||
| Total cash | A$ | 3,590,073 | US$ | 2,402,836 | A$ | 5,640,305 | US$ | 3,775,056 | US$ | 6,685,056 | ||||||||||
| Share Capital | A$ | 31,425,056 | US$ | 21,032,790 | A$ | 33,475,288 | US$ | 22,405,010 | US$ | 25,315,011 | ||||||||||
| Accumulated losses | A$ | (9,319,923 | ) | US$ | (6,237,824 | ) | A$ | (9,319,923 | ) | US$ | (6,237,824 | ) | US$ | (6,237,824 | ) | |||||
| Reserves | A$ | 3,904,804 | US$ | 2,613,485 | A$ | 3,904,804 | US$ | 2,613,485 | US$ | 2,613,485 | ||||||||||
| Total equity | A$ | 26,009,937 | US$ | 17,408,451 | A$ | 28,060,169 | US$ | 18,780,671 | US$ | 21,690,671 | ||||||||||
| Total capitalization | A$ | 26,009,937 | US$ | 17,408,451 | A$ | 28,060,169 | US$ | 18,780,671 | US$ | 21,690,671 | ||||||||||
| (1) | The amounts have been translated into U.S. dollars from Australian dollars based upon the Australian dollar/U.S. dollar exchange rate of 0.6693 as of December 31, 2025. |
| (2) | The as adjusted statement of financial position data give effect to our receipt of net proceeds from the issuance and sale of ADSs and Warrants at the assumed initial offering price of US$5.00 per ADS, and an ADS-to-ordinary share ratio of 1-to-10, after deducting underwriting commissions and estimated offering expenses payable by us and assuming no exercise of the Warrants. |
| (3) | Each US$1.00 increase (decrease) in the assumed initial public offering price of US$5.00 per ADS, after giving effect to the ADS-to-ordinary share ratio of 1-to-10, would increase each of cash, contributed equity, total equity and total capitalization by approximately A$1.0 million (or US$0.7 million) and decrease each of cash, contributed equity, total equity and total capitalization by approximately A$1.0 million (or US$0.7 million), assuming the number of ADSs and Warrants offered by us, as set forth on the cover page of this prospectus, remains the same, and after deducting underwriting discounts and commissions and estimated offering expenses payable by us and assuming no exercise of the Warrants. Similarly, an increase (decrease) of 100,000 ADSs and Warrants offered by us would increase each of cash, contributed equity, total equity and total capitalization by approximately A$0.6 million (or US$0.5 million) and decrease each of cash, contributed equity, total equity and total capitalization by approximately A$0.6 million (or US$0.5 million), assuming the assumed initial public offering price of US$5.00 per ADS, after giving effect to the ADS-to-ordinary share ratio of 1-to-10, remains the same, and after deducting underwriting discounts and commissions and assuming no exercise of the Warrants. The as adjusted information is illustrative only and will depend on the actual initial public offering price, number of ADSs and Warrants offered and other terms of this offering determined at pricing. |
The outstanding ordinary share information in the table above is based on 96,127,444 ordinary shares outstanding as of December 31, 2025, and excludes 1,047,994 ordinary shares issuable upon the exercise of outstanding options as of December 31, 2025, with a weighted-average exercise price of A$0.34 per ordinary share.
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If you invest in the ADSs and Warrants in this offering, your ownership interest will be immediately diluted to the extent of the difference between the initial public offering price per ADS and the as adjusted net tangible book value per ordinary share or ADS immediately after this offering.
The following amounts have been translated into U.S. dollars from Australian dollars based upon the Australian dollar/U.S. dollar exchange rate of 0.6693 as of December 31, 2025.
As of December 31, 2025, our historical net tangible book value was A$26,009,937 (or US$17,408,451), or A$2.71 (or US$1.81) per ADS. Historical net tangible book value per ADS represents our total tangible assets less total liabilities, divided by the number of ordinary shares outstanding as of December 31, 2025, converted to ADSs at an ADS-to-ordinary share ratio of 1-to-10.
After giving effect to the receipt of the net proceeds from our sale of 800,000 ADSs and 800,000 Warrants in this offering at an assumed initial public offering price of US$5.00 per ADS, after deducting underwriting discounts and commissions and estimated offering expenses payable by us and assuming no exercise of the Warrants, our as adjusted net tangible book value as of December 31, 2025 was A$30.1 million (or US$20.3 million), or A$2.89 (or US$1.95) per ADS. This represents an immediate increase in net tangible book value of US$0.14 per ADS to our existing shareholders and immediate dilution of US$3.05 per ADS, to investors purchasing ADSs in this offering, in each case based on an ADS-to-ordinary share ratio of 1-to-10.
The following table illustrates this dilution on a per ADS basis, assuming all ordinary shares outstanding as of December 31, 2025 converted to ADSs at an ADS-to-ordinary share ratio of 1-to-10:
| Assumed initial public offering price per ADS | US$ | 5.00 | ||||||
| Historical net tangible book value per ADS as of December 31, 2025 | US$ | 1.81 | ||||||
| Increase in net tangible book value per ADS attributed to investors purchasing ADSs in this offering | 0.14 | |||||||
| As adjusted net tangible book value per ADS after this offering | 1.95 | |||||||
| Dilution in net tangible book value per ADS to investors in this offering | US$ | 3.05 |
Each US$1.00 increase (decrease) in the assumed initial public offering price of US$5.00 per ADS, after giving effect to the ADS-to-ordinary share ratio of 1-to-10, would increase (decrease) the as adjusted net tangible book value per ADS after this offering by US$0.07 and dilution to investors in this offering by US$0.07 per ADS, assuming that the number of ADSs offered by us, as set forth on the cover page of this prospectus, remains the same and after deducting underwriting discounts and commissions and assuming no exercise of the Warrants. An increase (decrease) of 100,000 ADSs and Warrants offered by us would increase (decrease) the as-adjusted net tangible book value by US$0.03 per ADS and the dilution to investors in this offering would decrease (increase) by US$0.03 per ADS, assuming the assumed initial public offering price remains the same and after deducting underwriting discounts and commissions and assuming no exercise of the Warrants.
If the underwriter exercises its option to purchase 120,000 additional ADSs and 120,000 Warrants in full, the as adjusted net tangible book value after the offering would be US$1.95 per ADS, the increase in net tangible book value per ADS to existing shareholders would be US$0.03 per ADS and the dilution per ADS to new investors in this offering would be US$3.02 per ADS, in each case assuming an initial public offering price of US$5.00 per ADS and assuming no exercise of the Warrants, after giving effect to the ADS-to-ordinary share ratio of 1-to-10.
The dilution information above is for illustration purposes only. Our as adjusted net tangible book value following the closing of this offering will depend on the actual initial public offering price and other terms of this offering determined at pricing.
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The following table summarizes, as of December 31, 2025:
| ● | the total number of ordinary shares purchased from us by existing shareholders and the equivalent number of ordinary shares underlying ADSs purchased by investors in this offering; |
| ● | the total consideration paid to us by our existing shareholders and by investors purchasing ADSs and Warrants in this offering, assuming an initial public offering price of US$5.00 per ADS, after giving effect to the ADS-to-ordinary share ratio of 1-to-10, before deducting underwriting discounts and commissions and estimated offering expenses payable by us in connection with this offering and assuming no exercise of the Warrants; and |
| ● | the average price per ordinary share paid by existing shareholders and the average price per ADS or equivalent number of ordinary shares. |
| Ordinary Shares (Directly or in the Form of ADSs) | Total Consideration | Average Price Per | Average Price per | |||||||||||||||||||||
| Number | Percent | Amount | Percent | Share | ADS | |||||||||||||||||||
| Existing shareholders | 96,127,444 | 92.3 | US$ | 32,453,421 | 89.0 | US$ | 0.34 | US$ | 33.76 | |||||||||||||||
| Purchasers of ADSs | 8,000,000 | 7.7 | 4,000,000 | 11.0 | 0.5 | 5.00 | ||||||||||||||||||
| Total | 104,127,444 | 100 | US$ | 36,453,421 | 100 | |||||||||||||||||||
If the underwriter exercises its option to purchase additional ADSs and Warrants in full, our existing shareholders would own % and investors in this offering would own % of the total number of ordinary shares outstanding (including shares underlying ADSs) upon the closing of this offering.
Each US$1.00 increase (decrease) in the assumed initial public offering price of US$5.00 per ADS, after giving effect to the ADS-to-ordinary share ratio of 1-to-10, would increase (decrease) the total consideration paid by investors in this offering by US$800,000 and increase (decrease) the total consideration paid by investors in this offering by 20%, assuming that the number of ADSs and Warrants offered by us, as set forth on the cover page of this prospectus, remains the same and before deducting underwriting discounts and commissions and assuming no exercise of the Warrants.
The outstanding ordinary share information in the table above is based on 96,127,444 ordinary shares outstanding as of December 31, 2025, and excludes 1,047,994 ordinary shares issuable upon the exercise of outstanding options as of December 31, 2025, with a weighted-average exercise price of A$0.34 per ordinary share.
To the extent any outstanding options are exercised, there will be further dilution to investors purchasing in this offering.
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Location
Malawi is a narrow landlocked country in south-eastern Africa bordering Tanzania, Zambia and Mozambique. It has a population of approximately 19.6 million people and a land area of 118,480km2. Malawi’s economy is sustained by its agricultural industry that occupies the majority of the working population and accounts for the vast majority of export earnings. Malawi’s key agricultural exports include tobacco, tea, sugar, cotton and corn.
Economy
Malawi is characterised as having a mixed legal system where sources of law include statutory law, English law, customary law and religious law. Following its independence from Great Britain in 1964, Malawi was a one-party republic from 1966 to 1994 when it became a multiparty democracy and currently has a unitary system of government.
The mining industry currently accounts for approximately one percent of Gross Domestic Product (GDP) in Malawi. The mining sector in Malawi has remained relatively underdeveloped despite evidence of mineral deposits, the most prominent of which are coal, bauxite, uranium, niobium and gemstones. It was not until the development of the Kayelekera Uranium Mine by Paladin Energy Limited (ASX: PDN) in 2009 that public interest in the mining potential of Malawi increased. The Malawian government has sought to increase production in the mining sector through increased exploration and mining, improved legal and institutional frameworks, increased participation by small and medium scale miners and updated geological information systems. The Malawian government has a target to increase the mining sector’s contribution to GDP from less than one percent in 2011 to up to ten percent by 2063.
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Geology of Malawi
The geology of Malawi is dominated by the East Africa Rift with Lake Chilwa, being the most southern major lake associated with the rift valley and is broadly grouped into four main lithological units; the Basement Complex, the Karoo Super group, Tertiary to Quaternary sedimentary deposits and the Chilwa Alkaline province (see Figure 1 below).
Figure 1: Simplified geological map of Malawi
Lake Chilwa was formed in a depression created at the base of the back slope of a listric fault that is part of the rift valley system. Lake Chilwa is bordered in the east by the Shire Highlands, in the north by the Mongolwe, Chaone and Chikala mountains and the west by the Malosa and Zomba mountains.
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Basement rocks in the Lake Chilwa area are largely comprised of the Chilwa Alkaline Province (CAP). These rocks are Cretaceous in age and include nepheline synetites, carbonatites and associated dyke swarms. Most of the elevated topography to the north-west and west of Lake Chilwa is comprised of igneous intrusive rocks of the CAP.
The oldest rocks in the Lake Chilwa area are Pre-Cambrian metamorphics, primarily paragneiss and orthogneisses. These outcrop in numerous locations regionally and likely underlie much of the area. Basement gneisses are primarily charnockitic and horneblende-biotite in composition. Quartzite and granulite are also present in the areas north of the lake.
The Chilwa alkaline province is a major geological feature comprising Jurassic and Cretaceous carbonatites, syenites, and nephelines which form most of the prominent high points in the region and compose a large volume of all rock locally. These include the Zomba Massif, the Mulanje Massif and the Chikala Hills. The intrusion of these major bodies is associated with the main movement along the Rift Valley.
Palaeo lacustrine and beach deposits cover the majority of the surface area around Lake Chilwa and have a wide range of ages and mineralogies. Colluvial and residual deposits also cover large areas. Lake Chilwa is an endorheic basin and therefore the deposits directly reflect the local catchment history. In addition, the depositional environments fluctuate as the ingress of water into the system varied in response to the changing climate over the course of millions of years.
Structurally, the area was isolated from the main regional drainages by the Cholo fault that forms the border between the Shire Highlands and the Lower Shire Valley. This was the major fault of Karoo age in the region. Movement along this fault resulted in northeastern uplift that resulted in the Alkaline magmatism of the CAP. These then acted as a barrier between the Chilwa depression and the rest of the Shire/Zambezi Valleys. Further movement and subsidence led to the Shire lowering further and increased erosion.
This combined with the uplift of the Mulanje and Zomba Massifs formed a new fault scarp around Zomba separating the Lake Chilwa area further. The reduction in catchment area (the Shire River drains out of Lake Malawi and has cut a new channel in the separate Shire Valley), reduction in flow and the reversal of some of the river’s direction of flow due to local subsidence, meant that the basin filled with locally derived sediments. Presently, Lake Chilwa is completely separated and is the centre of a new drainage system that is currently regressing due to reduced flow.
The regional geology and structural evolution of the larger area surrounding the Lake Chilwa area has had a significant impact on the formation of the lake as well as the deposition and preservation of the HMS mineralisation that is present in the Exploration License. Several terraces and raised beach levels can be identified around the northern and western shores of Lake Chilwa, with specific terraces being associated with the mineralisation (refer to Figure 2).
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HMS deposits have been identified on the northern and western shores of Lake Chilwa. The heavy minerals occur predominantly as dune deposits, with minor fluvial and strand concentrations, associated with the palaeo-shoreline of the lake.
Figure 2: Regional geology of the Lake Chilwa/Zomba area
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MANAGEMENT’S
DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
The following discussion of our financial condition and results of operations should be read in conjunction with our audited consolidated financial statements and the notes to those financial statements appearing elsewhere in this prospectus.
Our consolidated financial statements appearing in this Registration Statement on Form F-1 are prepared in Australian dollars and in accordance with the International Financial Reporting Standards, or IFRS, as issued by the International Accounting Standards Board, or IASB. Our consolidated financial statements appearing in this Registration Statement on Form F-1 comply with both the IFRS and Australian Accounting Standards. In this Registration Statement, all references to “Australian dollars,” “A$” or “$” are to the currency of Australia.
This prospectus contains forward-looking statements. Forward-looking statements reflect current expectations, as of the date of this prospectus, and involve certain risks and uncertainties. Actual results could differ materially from those anticipated in these forward-looking statements as a result of various factors. Factors that could cause future results to materially differ from the recent results or those projected in forward-looking statements include, among others: unprofitable efforts resulting not only from the failure to discover mineral deposits, but also from finding mineral deposits that, though present, are insufficient in quantity and quality to return a profit from production; market fluctuations; government regulations, including regulations relating to royalties, allowable production, importing and exporting of minerals, and environmental protection; competition; the loss of services of key personnel; unusual or infrequent weather phenomena, sabotage, government or other interference in the maintenance or provision of infrastructure as well as general economic conditions.
Overview
Chilwa is an Australian mineral exploration company that was formed for the purpose of acquiring the Chilwa Critical Minerals Project (“Project”) from Luso Global Mining BV. Upon our listing on the ASX in July 2023, we acquired 100% of the issued share capital of Chilwa Minerals Africa Limited, an entity incorporated in Malawi that holds the tenements that comprise the Project. Our principal activities are mineral exploration at the Project.
We have incurred net losses since inception and have not generated revenue from our operations. We expect to continue to incur losses unless and until the Project enters commercial production and generates sufficient revenues to fund continuing operations. To date, we have funded our operations primarily through the sale of equity securities and interest income. We believe that our metals resources, technology and expertise position us for long-term growth.
Under IFRS, exploration and evaluation costs on mining tenements are allowed to be capitalized as deferred expenditure. If, however, exploration demonstrates a tenement is no longer prospective for economically recoverable reserves, or the exploration license is relinquished, then the value or cost of the tenement is immediately recognized as an expense in the income statement. We note that, if our financial statements were prepared under U.S. GAAP, all the exploration and evaluation costs would have been expensed.
During fiscal years 2024 and 2025, our exploration work focused on the initial sonic drilling program at the Mposa HMS deposit, complemented by geological surveying, geochemical sampling, and project-level technical studies.
Key Factors Affecting Our Results of Operations
We believe that our future performance and success depend to a substantial extent on the following factors, each of which is in turn subject to significant risks and challenges, including those discussed below and in the section titled “Risk Factors.”
Reserves and Production
Estimates of mineral reserves and resources are subject to evaluation uncertainties that could result in project failure. Further exploration and appraisals are required to determine the extent to which the Project contains economically viable mineral deposits and whether the deposits can be profitably exploited. The grade of ore ultimately mined, if any, may differ from that indicated by future feasibility studies and drill results, and minerals recovered in small-scale tests may not be duplicated in large-scale tests under on-site conditions or on a production scale. Any material changes in any mineral resource/reserve estimates and grades of mineralization will affect the economic viability of the Project.
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Should we progress to development, our operating performance in any production scenario would be shaped by a number of factors, including mining and processing rates, metallurgical recoveries, labor availability, energy and input costs, and the efficiency and reliability of our operating systems. Variations in ore grade, mineral characteristics, and processing performance could influence production volumes and unit operating costs, thereby affecting margins and cash flow.
Availability of Capital
The availability and management of capital are key factors affecting our operational progress and potential long-term financial outcomes. To date, we have funded our operations primarily through the sale of equity securities and interest income. If the expenditure requirements under our exploration licenses are not met, the licenses could be relinquished. Our capacity to raise additional capital on acceptable terms to fund exploration, development, and related operational activities, and the timing, amount, and cost of any future financing, could affect our project schedules, the scope of exploration programs, and the pace at which we can advance the Project.
Operating and Regulatory Environment in Malawi
Malawi’s evolving legal, regulatory, and economic environment significantly influences our ability to advance the Project and manage costs. Changes in laws, regulations and policies impacting mining, foreign ownership, environmental compliance, labor practices and taxation can materially affect project timelines, costs, and economics, as well as our capacity to secure rights and maintain operational continuity. Macroeconomic factors, such as currency fluctuations, inflation, and logistics costs, also directly impact exploration expenditures and overall project economics.
Malawi’s support for foreign investment, alongside improvements in infrastructure for energy, transportation, and ports, may lower costs and enhance operational efficiency. However, both regulatory developments and macroeconomic trends remain key factors shaping our ability to execute projects and achieve positive financial outcomes.
Demand and Supply for HMS and REE
The market for HMS products is driven by a wide range of factors, including global economic growth, industrial demand, and technological innovation. In recent years, the market has faced a number of challenges in line with general economic conditions, including declining demand for certain products, increased competition from alternative materials, and the general environmental concerns related to all mining and processing. We believe demand for ilmenite, zircon, and rutile will continue to grow, driven by forecasted economic growth and sustained consumption in pigments, ceramics, and other mature end-use markets.
The proliferation of smartphones, electric vehicles, and renewable energy technologies has increased demand for specific rare earth elements. The global shift towards green energy solutions has further amplified the demand for these elements, as nations strive to meet ambitious carbon reduction targets. The unique properties of each element make them indispensable in their respective applications, underscoring the strategic importance of securing a stable supply. As demand for clean energy and other advanced technologies increases in the coming years, we expect further increases in REE demand and prices.
On the supply side, global production of HMS and REEs remains geographically concentrated, subject to permitting constraints, environmental regulation, geopolitical dynamics, and long development lead times. Supply additions typically require significant capital investment and multi-year exploration, feasibility, and construction phases, which can limit the industry’s ability to respond quickly to changes in demand. In addition, regulatory scrutiny and community engagement requirements have increased across many jurisdictions, contributing to longer development timelines and higher compliance costs.
Foreign Currency Exposure
Our results of operations are influenced by fluctuations in foreign currency exchange rates. Although our presentation currency is the Australian dollar, we transact and hold financial assets and liabilities in other currencies, including U.S. dollars, Euro and Malawi Kwacha. Commodity prices relevant to our exploration activities are often denominated in U.S. dollars, creating exposure to currency movements.
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Exchange rate fluctuations can affect the cost of our operations, the value of assets and liabilities, and the economics of advancing our exploration projects. A stronger Australian dollar may reduce local currency costs but could lower the Australian dollar equivalent of potential future revenues, while a weaker Australian dollar may increase reported expenses. Managing currency exposure will therefore be an important factor shaping our operating costs, capital requirements, and overall financial performance.
Results of Operations
The following discussion and analysis provide information that is believed to be relevant to an assessment and understanding of our results of operation and financial condition for the half years ended December 31, 2025 and 2024 and for the years ended June 30, 2025 and 2024.
Comparison of half year ended December 31, 2025 to half year ended December 31, 2024
Income
During the half years ended December 31, 2025 and 2024, we generated income of A$23,968 and A$53,366, respectively, solely from interest income from cash and cash equivalents. The decrease was primarily driven by lower average cash balances during the half year ended December 31, 2025 compared to the prior half year, as more funds were used to support exploration activities and operating expenditures.
Expenditure
During the half years ended December 31, 2025 and 2024, we reported total operating expenses of A$2,677,733 and A$1,353,522, respectively. The increase was primarily due to an increase in share-based payments expense from A$374,795 in the half year ended December 31, 2024 to A$687,482 in the half year ended December 31, 2025, as a result of increased management personnel compensation, an increase in compliance and regulatory costs from A$231,607 in the half year ended December 31, 2024 to A$765,667 in the half year ended December 31, 2025, as a result of increases in general business activities and establishing local administration and compliance capabilities in Malawi in the half year ended December 31, 2025, an increase in administration expenses from A$228,583 in the half year ended December 31, 2024 to A$259,286 in the half year ended December 31, 2025, due to an increase in headcount, an increase in consultancy and professional fees from A$89,335 in the half year ended December 31, 2024 to A$231,942 in the half year ended December 31, 2025, due to increased consultant services as a result of our growth, an increase in depreciation expense from A$24,639 in the half year ended December 31, 2024 to A$60,916 in the half year ended December 31, 2025, due to an increase in our tenements, and an increase in employee benefits expense from A$431,188 in the half year ended December 31, 2024 to A$696,408 in the half year ended December 31, 2025, due to an increase in headcount. This was partially offset by decreases in other expenses from A$26,741 in the half year ended December 31, 2024 to nil in the half year ended December 31, 2025, due to the non-recurrence of miscellaneous sundry costs incurred in the half year ended December 31, 2024 that did not arise in the half year ended December 31, 2025.
Net Loss and Comprehensive Loss
As a result of the above, we experienced a net loss of A$2,677,733 for the half year ended December 31, 2025 compared to a net loss of A$1,353,522 for the half year ended December 31, 2024.
We had a comprehensive loss of A$1,356,333 and A$2,674,511 for the half years ended December 31, 2025 and 2024, respectively. Comprehensive (loss) / income for the half years ended December 31, 2025 and 2024 includes A$3,222 other comprehensive income and (A$2,811) other comprehensive loss, respectively.
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Comparison of the year ended June 30, 2025 and the year ended June 30, 2024
Income
During the years ended June 30, 2025 and 2024, we generated income of A$125,991 and A$202,811, respectively, solely from interest income from cash and cash equivalents. The decrease was primarily driven by lower average cash balances during fiscal year 2025 compared to the prior year, as more funds were used to support exploration activities and operating expenditures.
Expenditure
During fiscal years 2025 and 2024, we reported total operating expenses of A$3,489,086 and A$2,017,420, respectively. The increase was primarily due to an increase in share-based payments expense from A$389,741 in fiscal year 2024 to A$948,505 in fiscal year 2025, as a result of increased management personnel compensation, an increase in compliance and regulatory costs from A$435,116 in fiscal year 2024 to A$533,782 in fiscal year 2025, as a result of increases in general business activities and establishing local administration and compliance capabilities in Malawi in fiscal year 2025, an increase in administration expenses from A$319,067 in fiscal year 2024 to A$495,606 in fiscal year 2025, due to an increase in headcount, an increase in consulting expenses from A$89,777 in fiscal year 2024 to A$500,844 in fiscal year 2025, due to increased consultant services as a result of our growth, an increase in depreciation expense from A$28,419 in fiscal year 2024 to A$94,983 in fiscal year 2025, due to an increase in our tenements, and an increase in employee benefits expense from A$755,300 in fiscal year 2024 to A$915,366 in fiscal year 2025, due to an increase in headcount. This was partially offset by decreases in other expenses from A$175,794 in fiscal year 2024 to A$95,171 in fiscal year 2025.
Net Loss and Comprehensive Loss
As a result of the above, we experienced a net loss of A$3,363,095 for fiscal year 2025 compared to a net loss of A$1,814,609 for fiscal year 2024.
We had a comprehensive loss of A$3,439,031 and A$1,812,264 for fiscal years 2025 and 2024, respectively. Comprehensive (loss) income for fiscal years 2025 and 2024, is inclusive of a (A$75,936) and A$2,345 exchange differences on translation of our operations in Malawi, respectively.
Liquidity and Capital Resources
As of June 30, 2026, 2025 and 2024, we had cash and cash equivalents of A$1,101,524, A$687,022 and A$4,151,472, respectively. In August 2025, we raised A$4.1 million from existing shareholders and sophisticated investors in a private placement. Due to the nature of our current operations, being mineral exploration, we do not have ready access to credit facilities and have primarily relied on equity raisings as the source of our funding.
We are an exploration-stage mineral exploration issuer whose activities to date have been funded primarily through equity issuances and shareholder loans. We do not currently generate operating revenues from our mineral properties and therefore rely on external financing to meet ongoing operating expenditures, exploration commitments, and working capital needs.
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In our opinion, based on our current exploration plans, anticipated corporate overhead, and ongoing regulatory and listing expenses, and taking into account our cash on hand and the anticipated net proceeds of this offering, our working capital is sufficient for our present requirements for at least the period through June 2027. If additional working capital becomes necessary, we intend to meet such needs through equity financing, potential strategic partnerships, or debt financing where available.
Beyond June 2027, we expect that continued exploration, metallurgical test work, environmental studies, and the advancement of our Lake Chilwa mineral sands licenses toward potential development will require additional capital. Long-term liquidity is therefore expected to be financed primarily through:
| ● | Subsequent equity offerings, |
| ● | Government funding and or grants, |
| ● | Project-level or joint-venture financing, |
| ● | Royalties or streaming arrangements, and |
| ● | Potential debt financing upon establishing mineral reserves. |
As we do not expect to generate positive operating cash flows until a mining operation is developed and commissioned, access to external capital markets will remain a key component of our long-term funding strategy.
Cash Flows and Restrictions on Transfer of Funds
As a mineral exploration company, we have experienced:
| ● | Negative operating cash flows, reflecting exploration, permitting, and administrative costs; |
| ● | Investing cash outflows, reflecting capitalized acquisition costs for mineral licences; and |
| ● | Financing inflows, primarily from equity issuances. |
We expect negative operating and investing cash flows to continue until commercial production is achieved, if at all.
Restrictions on Transfer of Funds from Subsidiaries
We conduct exploration activities in Malawi through our wholly owned subsidiaries Chilwa Minerals Africa Limited and Phalombe Minerals Limited. Under Malawi law:
| ● | There are no statutory restrictions preventing subsidiaries from distributing dividends or making intercompany loans, provided all tax obligations are met and the entities remain solvent. |
| ● | Exchange control regulations require that cross-border transfers be processed through authorized banks, but such transfers are routine and not considered prohibitive. |
| ● | We are required to ensure that minimum annual exploration expenditures and environmental obligations are met under each Exploration Licence. These conditions do not restrict cash repatriation but may influence the timing of discretionary transfers. |
To date, these requirements have not had a material impact on the Company’s ability to meet its cash obligations, nor does management currently expect these regulations to materially affect liquidity in the foreseeable future.
Our Board of Directors constantly monitors the state of equity markets in conjunction with our current and future funding requirements, with a view to initiating appropriate capital raisings as required. We also manage liquidity risk and ensure sufficient cash is available to meet our current and future commitments by continuously monitoring forecast and actual cash flows, conducting ongoing cost reviews, and implementing cost-cutting measures on non-core activities to improve cash flow.
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Going Concern Qualification
Our consolidated financial statements have been prepared on a going concern basis, which contemplates the continuity of normal business activity and the realization of assets and the settlement of liabilities in the ordinary course of business. Our ability to continue as a going concern is dependent upon our ability to generate profitable operations in the future and/or to obtain the necessary financing to meet our obligations and repay our liabilities arising from normal business operations as and when they come due. In the event that we are unable to raise additional working capital, when required, there is a material uncertainty as to whether we will be able to meet our debts as and when they fall due and thus continue as a going concern.
The accompanying consolidated financial statements do not include any adjustments relating to the recoverability and classification of recorded assets, or the amounts of and classification of liabilities that might be necessary in the event we cannot continue in existence.
Commitments and Contractual Obligations as of June 30, 2025
The following table describes our commitments and contractual obligations as of June 30, 2025:
| Within
one year | Later
than one year but not later than five years | Later
than five years | Total | |||||||||||||
| Exploration expenditure commitment(1) | $ | 189,848 | - | - | $ | 189,848 | ||||||||||
| Drilling contract commitments(2) | $ | 1,334,554 | $ | 1,174,080 | $ | 89,057 | $ | 2,597,691 | ||||||||
| Trade and other payables(3) | $ | 2,717,809 | - | - | $ | 2,717,809 | ||||||||||
| Total | $ | 4,242,211 | $ | 1,174,080 | $ | 89,057 | $ | 5,505,348 | ||||||||
| (1) | In order to maintain current rights of tenure to exploration and mining tenements, we are required to outlay the amounts disclosed above. If the expenditure commitments are not met, the associated exploration and mining leases may be relinquished. |
| (2) | The Company has entered into several drilling contracts, including sonic and diamond drilling, under which services are charged at fixed rates per meter drilled. These contracts are required to be paid in accordance with the contractual rates and represent material cash commitments of the Company arising in the ordinary course of business. |
| (3) | These amounts represent trade and other payables arising in the ordinary course of business, including accruals for drilling activities, service deed obligations, legal fees, taxes payable, consultant fees, and other operating costs. The Company expects these obligations to be settled within one year. |
Cash Flow
Comparison of cash flows for the half year ended December 31, 2025, with the half year ended December 31, 2024
Operating Activities
For the half year ended December 31, 2025, net cash used in operating activities was A$1,858,131 compared to A$1,012,779 for the half year ended December 31, 2024, primarily due to an increase in payments to suppliers and employees from A$1,066,145 in the half year ended December 31, 2024 to A$1,882,099 in the half year ended December 31, 2025, due to an increase in headcount, and a decrease in interest received from A$53,366 in the half year ended December 31, 2024 to A$23,968 in the half year ended December 31, 2025, as a result of differences in the cash balances due to the frequency of and timing of our capital raisings in those respective periods.
Investing Activities
For the half year ended December 31, 2025, net cash used in investing activities was A$5,467,712 compared to A$3,266,927 for the half year ended December 31, 2024, primarily due to an increase in payments for exploration expenditure capitalized from A$2,458,270 in the half year ended December 31, 2024 to A$5,399,038 in the half year ended December 31, 2025, due to an increase in exploration activities. This was partially offset by a decrease in payments for plant and equipment from A$808,657 in the half year ended December 31, 2024 to A$68,674 in the half year ended December 31, 2025, due to our purchases of drilling rigs in the half year ended December 31, 2024.
Financing Activities
For the half year ended December 31, 2025, we had net cash provided by financing activities of A$10,253,917, as consideration for issuance of shares, compared to net cash used in financing activities of A$4,801,476 for the half year ended December 31, 2024, primarily as a result of an increase in proceeds from the issue of shares from A$4,825,212 in the half year ended December 31, 2024 to A$10,502,403 in the half year ended December 31, 2025, due to our capital raising activities in the half year ended December 31, 2025. This was partially offset by an increase in payments of share issue transaction costs from A$23,736 in the half year ended December 31, 2024 to A$248,486 in the half year ended December 31, 2025 due to increased costs incurred in relation to the issuances of share capital in the period.
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Comparison of cash flows for the fiscal year ended June 30, 2025, with June 30, 2024
Operating Activities
For fiscal year 2025, net cash used in operating activities was A$2,049,217 compared to A$1,753,245 for fiscal year 2024, primarily due to an increase in payments to suppliers and employees from A$1,956,056 in fiscal year 2024 to A$2,175,208 in fiscal year 2025, due to an increase in headcount, and a decrease in interest received from A$202,811 in fiscal year 2024 to A$125,991 in fiscal year 2025, due to differences in the frequency of and timing of our capital raisings.
Investing Activities
For fiscal year 2025, net cash used in investing activities was A$8,379,056 compared to A$1,708,402 for fiscal year 2024, primarily due to an increase in payments for exploration expenditure capitalized from A$1,697,772 in fiscal year 2024 to A$7,981,261 in fiscal year 2025, due to an increase in exploration activities, and an increase in payments for plant and equipment from A$84,795 in fiscal year 2024 to A$397,795 in fiscal year 2025, due to our purchases of drilling rigs in fiscal year 2025. This was partially offset by a decrease in cash acquired on the acquisition of subsidiaries from A$74,165 in fiscal year 2024 to nil in fiscal year 2025, since we acquired Mota-Engil Malawi Investments Limited in fiscal year 2024 but did not acquire cash from acquiring subsidiaries in fiscal year 2025.
During fiscal year 2025, we increased our exploration activities by escalating both the scale and scope of drilling operations across multiple deposits within the Project. In January 2025, we commissioned a second sonic drill rig, enabling dual-rig operations across the Project. Between January and June 2025, we completed or substantially advanced sonic drilling programs at five deposits:
| ● | Mpyupyu: Approximately 1,400 boreholes completed on 100m × 100m and 200m × 200m grid patterns, with depths ranging from 4 to 14 meters. This represented our largest single drilling campaign and established Mpyupyu as a key deposit for the planned scoping study. |
| ● | Bimbi: Approximately 284 boreholes (BIMSD005–279) were completed between late March and late April 2025, with depths of 5 to 13 meters. |
| ● | Halala: 19 boreholes were drilled in May 2025 (HALSD019–042), with depths of 7 to 20 meters in a sand dune deposit on the northern shore of Lake Chilwa. |
| ● | Namasalima: 47 boreholes were completed in June 2025, with depths of 4 to 10 meters. |
| ● | Mposa: We completed the remaining Mposa sonic drilling program between July to September 2024. |
We also commenced our maiden diamond drilling program at the Mposa deposit in March 2025, targeting the REE geophysical anomaly identified from the aeromagnetic survey. Six diamond drill holes (MPODD001–006) were completed between March and July 2025, totaling 1,008.3 meters at depths ranging from 104 to 221 meters. Assay results from the first hole confirmed elevated total rare-earth oxide (TREO) values of up to 1,039 ppm in the clay and saprolite horizons to depths of 80 meters downhole.
In March 2025, we also commenced our plant feed characterization and flowsheet development studies, processing a 4.2-tonne sample from the central region of the Mposa deposit. Key results received in September 2025 confirmed multiple product streams, including a high-quality ilmenite product grading 51% TiO₂ with 93% titanium recovery; zircon concentrates grading approximately 66% ZrO₂; garnet concentrate at 57% with 72% recovery; and monazite concentrate grading greater than 24% with high cerium enrichment.
We invested A$397,795 in plant and equipment during fiscal year 2025, including the establishment of an in-country sample preparation laboratory in Malawi, and the procurement of field equipment.
Cash payments for exploration expenditure capitalized during fiscal year 2025 totaled A$7,981,261, representing a 370% increase over the prior year. Capitalized exploration and evaluation assets on the balance sheet increased from A$11,333,988 at June 30, 2024 to A$18,598,678 at June 30, 2025, representing approximately 91% of total assets.
In fiscal year 2024, our exploration activities focused on the initial sonic drilling program at the Mposa HMS deposit, complemented by geological surveying, geochemical sampling, and project-level technical studies. Sonic drilling at Mposa commenced in October 2023, utilising a single Eijkelkamp sonic drill rig. By June 30, 2024, we had completed approximately 300 sonic boreholes at Mposa on a 100m × 100m grid pattern, with hole depths ranging from 5 to 9 meters. Total sonic drilling expenditure during fiscal year 2024 was approximately US$ 780,000.
In addition, we incurred approximately US$220,000 in geological services and management fees during fiscal year 2024, comprising geological consulting, geophysical survey interpretation, sample management, and project supervision services. During fiscal year 2024, we also completed an aeromagnetic and radiometric survey over the entire Project area, which identified 47 rare earth element geophysical anomalies that have informed subsequent exploration planning.
Cash payments for exploration expenditure capitalized during fiscal year 2024 totaled A$1,697,772, representing drilling costs, geological services, assay and laboratory fees, and associated field costs. These expenditures were capitalized as exploration and evaluation assets in accordance with IFRS 6.
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Financing Activities
For fiscal year 2025, we had net cash provided by financing activities of A$7,058,995, as consideration for issuance of shares, compared to net cash used in financing activities of A$403,740 for fiscal year 2024, primarily as a result of transaction costs related to share issuance, which decreased from A$447,044 in fiscal year 2024 to A$23,736 in fiscal year 2025 due to increased share-based management personnel compensation, an increase in proceeds from the issue of shares from nil in fiscal year 2024 to A$7,094,611 in fiscal year 2025, due to our capital raising activities in fiscal year 2025 and an increase in proceeds from future share issue from nil in fiscal year 2024 to A$31,424 in fiscal year 2025. This was partially offset by a decrease in proceeds from borrowings from A$43,304 in fiscal year 2024 to nil in fiscal year 2025, and an increase in repayment of borrowings from nil in fiscal year 2024 to A$43,304 in fiscal year 2025.
Critical Accounting Judgement, Estimates and Assumptions
The preparation of our consolidated financial statements requires the use of certain critical accounting estimates. It also requires management to exercise its judgment in the process of applying our accounting policies. The areas involving a higher degree of judgement or complexity, or areas where assumptions and estimates are significant to the consolidated financial statements, are as follows.
Exploration expenditure
Exploration and evaluation expenditures are accumulated in respect of each separate area of interest. Exploration and evaluation costs are carried forward where right of tenure of the area of interest is current and they are expected to be recouped through sale or successful development and exploitation of the area of interest, or, where exploration and evaluation activities in the area of interest have not yet reached a stage that permits reasonable assessment of the existence of economically recoverable reserves. When an area of interest is abandoned or the directors decide that it is not commercial, any accumulated expenditures in respect of that area are written off in the financial period the decision is made. The carrying value of our projects are reviewed at least annually for appropriateness and to determine if there are any impairment indicators.
The future recoverability of capitalized exploration and evaluation expenditure is dependent on a number of factors, including whether we decide to exploit the related lease ourselves or, if not, whether we successfully recover the related exploration and evaluation asset through sale.
Factors that could impact the future recoverability include the level of reserves and resources, future technological changes, costs of drilling and production, production rates, future legal changes (including changes to environmental restoration obligations), and changes to commodity prices.
Share-based payment transactions
The cost of equity-settled compensation (by shares, options or rights over shares) provided by our company to employees and contractors are measured at fair value on grant date. Fair value is determined using either the Binomial or Black-Scholes option pricing model that takes into account the exercise price, the term of the option, the share price at grant date and expected price volatility of the underlying share, the expected dividend yield and the risk free interest rate for the term of the equity instruments, together with non-vesting conditions that determine whether we receive the services that entitle the employees and contractors to receive payment. The cost of equity-settled transactions are recognized as an expense with a corresponding increase in equity over the vesting period. The cumulative charge to profit or loss is calculated based on the grant date fair value of the awards, the best estimate of the number of awards that are likely to vest and the expired portion of the vesting period. The amount recognized in profit or loss for the period is the cumulative amount calculated at each reporting date less amounts already recognized in previous periods. Market conditions are taken into consideration in determining fair value. Therefore, any awards subject to market conditions are considered to vest irrespective of whether or not that market condition has been met, provided all other conditions are satisfied. If equity-settled awards are modified, an additional expense is recognized, over the remaining vesting period, for any modification that increases the total fair value of the share-based compensation benefit as at the date of modification. If equity-settled awards are cancelled, it is treated as if it has vested on the date of cancellation, and any remaining expense is recognized immediately.
We measure the cost of equity-settled transactions with employees and contractors by reference to the fair value of the equity instruments at the date at which they are granted. The fair value is determined by an internal valuation using an appropriate option pricing model or quoted active market price, using the assumptions detailed in note 24 to the accompanying financial statements. If any of these assumptions, including the probabilities of achieving the performance hurdles, were to change, there may be an impact on the amounts reported.
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Off-Balance Sheet Arrangements
We have no off-balance sheet arrangements.
Quantitative and Qualitative Disclosure about Market Risk
We consider market risk to be the potential loss arising from adverse changes in market rates and prices. In the ordinary course of our business as currently conducted, which primarily consists of our mining exploration activities, we are not exposed to market risk of the sort that may arise from changes in commodity prices.
Foreign Exchange Risk
We undertake certain transactions denominated in foreign currency and are exposed to foreign currency risk through foreign exchange rate fluctuations. Foreign exchange risk arises from future commercial transactions and recognized financial assets and financial liabilities denominated in a currency that is not our functional currency of the subsidiary in which the foreign currency is transacted. Our exposure to these risks is measured through sensitivity analyses and cash flow forecasting.
Based on this exposure, if the Australian dollar had weakened by 10% or strengthened by 10% against the relevant foreign currencies, our loss before tax for fiscal year 2025 would have increased by A$265,774 or decreased by A$265,774, respectively (compared to an increase of A$206,777 or decrease of A$206,777 for the prior year).
Interest Rate Risk
We are exposed to movements in market interest rates on cash and cash equivalents. We monitor the interest rate yield curve out to 120 days to ensure a balance is maintained between the liquidity of cash assets and the interest rate return. The proportional mix of floating interest rates and fixed rates, to a maximum of six months, fluctuates during the year depending on current working capital requirements. The weighted average interest rate we received on cash and cash equivalents for the years ended June 30, 2025 and 2024 was 3.3% and 3.6%, respectively.
As of June 30, 2025, if interest rates had changed by +/- 100 basis points from the weighted average rate for the year with all other variables held constant, our post-tax loss would have been $38,402 lower/higher for fiscal year 2025 and $55,734 for fiscal year 2024 as a result of higher/lower interest income from cash and cash equivalents.
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Overview
We are a mineral exploration company looking to deliver growth and value for our shareholders through achieving success from exploration and evaluation programs. Our principal activities are mineral exploration activities at the Chilwa Critical Minerals Project (the “Project”), which is located around the northern, western and southern shores of Lake Chilwa in southern Malawi.
Malawi, a landlocked country in southeastern Africa famed for the warmth and kindness of its people, is known as “The Warm Heart of Africa.” It is bordered by Zambia to the west, Tanzania to the north and northeast, and Mozambique to the east, southeast and southwest. Malawi is an underexplored country and an emerging mining destination with a stable regime, a supportive government and a newly developed infrastructure network.
We hold, through our 100% owned subsidiaries Chilwa Minerals Africa Limited and Phalombe Minerals Limited, three exploration licenses that grant us the exclusive rights to carry out exploration for certain heavy mineral sands (“HMS”) and rare earth elements (“REE”) over a total tenement area of 881.0136 km2. The project hosts a geologically coherent and district-scale mineral system capable of supporting multiple styles of critical mineralisation, including:
| ● | HMS |
| ● | Carbonatite-hosted REE |
| ● | Ionic Adsorption Clay Rare Earth Element potential |
Sectional interpretation has been done on all the northern deposits (Nkotamo, Halala, Beacon and Namanja West) on the Project.
In addition, we have intersected high-grade REE in the clays below the mineral sands, with many highly prospective carbonatite targets to be assessed, including Chisi Island. Other targets that require ground truthing have been identified in the southern extension area and Mpyupyu Area. The first batch of REE analysis was undertaken in July 2024 as a pathfinder process to assess the potential coexistence of REEs in the heavy mineral concentrates. The REEs that were included in the analysis were Cerium (Ce2O3), Europium (Eu2O3), Gadolinium (Gd2O3), Lanthanum (La2O3), Neodymium (Nd2O3), Praseodymium (Pr6O11), Samarium (Sm2O3) and Ytterbium (Yb2O3). Diamond drilling in late 2024 has also yielded positive results, confirming the presence of REE mineralization. Substantial advancements in exploration and resource development in the REE sector have been made, with over 47 geophysical features or anomalies identified. We believe that the discovery of new exploration targets and the successful completion of several exploration and drilling programs have significantly strengthened our overall portfolio and positioned us well to continue to explore for REE, essential for various high-tech applications.
We believe the Project can develop into a viable mineral sands project and that we are exploring a Tier 1 mineralized system in southern Malawi.
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Cautionary Note Regarding Presentation of Mineral Reserve and Mineral Resource Estimates
The definitions and standards of the SEC Mining Disclosure Rules differ from those in the Joint Ore Reserves Committee of the Australasian Institute of Mining and Metallurgy, Australian Institute of Geoscientists and Minerals Council of Australia (“JORC”), which are applicable to resources companies listed on the ASX. Investors are therefore cautioned that public disclosure by us of mineral resources in Australia in accordance with JORC (as required by the ASX Listing Rules) does not form a part of this prospectus. You should not rely on any mineral resource estimate that we have disclosed or may disclose in Australia. We are unable to report such estimates in our filings with the SEC because we have not established the technical and economic conditions that are necessary to show reasonable prospects for economic extraction, based on the definition of resources in the SEC Mining Disclosure Rules. Under the SEC Mining Disclosure Rules, mineralization may not be classified as a reserve unless the determination has been made that the mineralization could be economically and legally produced or extracted at the time the reserve determination is made. We are an exploration stage company and we have no mineral reserves as defined by the SEC Mining Disclosure Rules.
Our Registration Statement on Form F-1, as originally filed with the SEC on July 9, 2026, contained estimates of mineral resources that were stated to have been prepared in accordance with the SEC Mining Disclosure Rules, together with a technical report summary prepared by Belenos Holdings (Pty) Ltd filed as Exhibit 96.1 and the related consents of qualified persons. Those mineral resource estimates, that technical report summary and those consents have been removed from this amendment to our Registration Statement on Form F-1 in their entirety, as has the statement that those estimates conformed to the requirements of the SEC Mining Disclosure Rules. You should not rely on the mineral resource estimates, the technical report summary, the qualified person consents or the statement of conformity with the SEC Mining Disclosure Rules that were included in or filed with the Registration Statement on Form F-1, as originally filed with the SEC on July 9, 2026. None of that information forms a part of this prospectus. This prospectus does not contain any estimate of mineral resources or mineral reserves.
Chilwa Critical Minerals Project
Our Chilwa Critical Minerals Project (the “Project”), which is located around the northern, western and southern shores of Lake Chilwa in southern Malawi, as shown in the below map. The Project is in the exploration stage and we plan to build a processing plant if and when the Project enters the production stage.
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We hold, through our 100% owned subsidiaries Chilwa Minerals Africa Limited and Phalombe Minerals Limited, three exploration licenses that grant us the exclusive rights to carry out exploration for certain HMS and rare earth elements REE over a total tenement area of 881.0136 km2. The project hosts a geologically coherent and district-scale mineral system capable of supporting multiple styles of critical mineralization, including:
| ● | HMS; |
| ● | Carbonatite-hosted REE; and |
| ● | Ionic Adsorption Clay Rare Earth Element potential. |
In September 2025, we completed Phase 2 metallurgical test work on a 4.2 tonne bulk sample from the Mposa deposit. The test work program characterized three composite samples of material sourced from the Mposa project area, located on the west coast of Lake Chilwa in southeastern Malawi. 2,909 drill samples were used to generate the metallurgical composites, representing the three preliminary lithological zones identified to date, referred to as the “Sand, “Silty Sand,” and “Clay” units. The characterization work on the first phase of drill hole samples from batches 1 to 3 indicates a favorable heavy mineral assemblage with a high percentage of valuable heavy mineral content, including ilmenite, zircon, rutile, garnet, and monazite. Monazite, a phosphate mineral, is a primary source of REEs and thorium.
The Sand unit composite had a heavy mineral (“HM”) grade of 8.8% with approximately 89.5% of the HM fraction considered as being valuable heavy minerals (76% ilmenite, 9.5% zircon, 1.4% rutile and 2.5% almandine garnet). The Silty Sand unit composite had an HM grade of 3.8% with around 88% of this considered to be valuable heavy minerals (75% ilmenite, 8.9% zircon, 2.3% rutile, 1.6% almandine garnet). The samples representing the Clay unit were characterized by a lower HM grade of around 1%, with the HM fraction containing a significant proportion (approximately 40%) of non-valuable minerals, such as goethite, pyroxene and feldspar. The valuable heavy minerals are relatively fine grained (less than 45 microns) and include 43% ilmenite, 6.6% zircon, 3.8% rutile, and 4.0% almandine.
Magnetic separation of the Sand and Silty Sand unit heavy mineral fractions indicates that a low-impurity ilmenite, containing 50% TiO₂, and a non-magnetic concentrate containing 55% to 60% zircon could be produced using conventional magnetic separation equipment. Further processing of this material will be investigated during a planned bulk test work program to fully evaluate the potential quality of the final product. The non-magnetic fraction generated from the Sand and Silty Sand units contained 0.64% and 0.85% Cerium Oxide (CeO₂), respectively, in the non-magnetic product, indicating that 2% to 3% of the rare earth containing mineral monazite is present in the sample. Further processing stages, including flotation, will be investigated to assess the production of a monazite concentrate. The results from the recent metallurgical characterization work will be used to develop a test program aimed at treating bulk samples from the project area, further assessing metallurgical performance and generating a range of final products for quality assessment.
Our drilling methods used at the Mpyupyu deposit included 1,398 sonic drill holes totaling a depth of 6,174m drilled, with an average depth of 4.42m, a minimum depth of 0.32m and maximum depth of 14.00m. In June 2026, we announced that through reconnaissance hand panning, we also extended the Mpyupyu West HMS target from approximately 5 km2 to over 17 km2. 60 holes for 551 meters of a planned 268 hole Phase 1 program have been completed on a nominal 400 m north x 200 m east grid over interpreted thorium anomalies. Two sonic rigs have commenced drilling at Mpyupyu West, with initial holes intersecting a mineralized, free-dig saprolite unit to approximately 11m beneath thin sand cover, to test whether Mpyupyu West links physically with the Mpyupyu Dune and Flat deposits.
In March 2026, we announced the discovery of Niobium mineralisation following the receipt of further ICP-MS assay results from diamond drilling conducted in the south of the Project’s Mpyupyu target. The nature and consistency of Nb₂O₅ grades in MPYDD006 confirm the presence of a niobium-enriched intrusive phase over 120m (downhole thickness) in extent. Key intervals (at Nb205 >0.2%) from MPYDD006 include:
| ● | 0.31% Nb205 (1,661ppm TREO, 174ppm Ta, 55 ppm Ga) over 126.1m from 125m downhole |
| ● | 0.38% Nb205 (1,654ppm TREO, 225 ppm Ta, 61ppm Ga) over 62m from 138m downhole, including 0.45% Nb205 over 10m (2,365ppm TREO, 317ppm Ta, 64ppm Ga) from 190m downhole. |
| ● | 0.57% Nb205 (2,270ppm TREO, 320.4 ppm Ta, 56.7ppm Ga) over 1.55m from 129m downhole. |
| ● | 0.51% Nb205 (2,438 ppm TREO, 361 ppm Ta, 65ppm Ga) over 1m from 195m downhole. |
| ● | 0.41% Nb205 (1,405 ppm TREO, 218 ppm Ta, 62ppm Ga) over 12m from 155m downhole. |
In April 2026, diamond drilling at the Mpyupyu target, conducted as part of our carbonatite-hosted REE exploration program, intersected a previously unmapped peralkaline syenite intrusion hosting significant niobium mineralisation. The nature and consistency of Nb₂O₅ grades in discovery hole MPYDD006 confirm the presence of a niobium-enriched intrusive phase over 120m (downhole width) in extent. We now have two diamond drill rigs operating within 175m of each other. Rig 1 has completed drill hole MPYDD009, at a depth of 385m in alkaline-syenite intrusive series rocks. Rig 2 commenced drilling hole MPYDD016 and progressed to a depth of 65m before technical difficulties progressing through heavily fractured ground forced the hole to be closed. A second hole (MPYDD016B) was commenced on an azimuth 45° northwest of the initial hole and progressed to a depth of 80m. Approximately 1,050m of drilling has been completed across six drill holes at the target. This excludes meters drilled at MPYDD001–005 on the northern thorium anomaly (MPYTH004) shore of the Nakombe stream, the southern anomaly (MPTH005).
A total of nine drill holes remain in the initial program, intended to constrain the geometry, phase boundaries, and lateral continuity of the multi-phase intrusive system, with ICP-MS assay results expected to follow. Currently the target remains open to the south, east and southeast, as well as at depth. QEMSCAN has quantified monazite throughout the Mpyupyu deposit, adding REE exploration by-product potential alongside the ilmenite-zircon-rutile assemblage. Further QEMSCAN analysis of composites and further metallurgical work is planned pending the results of ongoing exploration drilling.
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Historical work on the Project included Millennium Mining Limited, which conducted exploration on the northern deposits during the early 2000s, drilling 64 holes at Halala and 40 holes at Namanja in their initial campaign. In addition, Tate Minerals Limited acquired the exploration license in 2012 and digitised large amounts of the historic data on the property. Mota Engil Group entered into a joint venture agreement with Tate Minerals and commenced a full exploration campaign including auger drilling, bulk sampling, ground radiometrics, mineralogical studies and concept test work. Luso Global Mining BV, a subsidiary of Mota Engil Group, then acquired the Project and commissioned a further review of the historic data.
In fiscal 2024, we acquired the Project for A$7,475,835. As of December 31, 2025, we had exploration and evaluation assets of A$22,729,567 and plant and equipment of A$387,562 recorded on our balance sheet.
We believe that the Project currently has sufficient access to water and electricity. Water sources include water bores and Lake Chilwa, which is located nearby. In addition, a hydropower plant is being built nearby that is expected to be completed if and when the Project enters the production stage. The Project benefits from access to rail, port and supporting infrastructure with a pit-to-port solution for exporting products to global markets. For example, the Project is connected to the Nacala rail link (as shown in the above map) with final products transported approximately 700km from Liwonde to the Nacala Deep Water Port for export. This established rail and port infrastructure is key to our prospects for economic development of the Project, since it minimizes the requirement for significant capital expenditure. The railway line from Liwonde to Nacala has been upgraded and is used to transport coal from Moatize, in Tete province to the new coal terminal at Nacala. The rail is accessible from Zomba via the M3 road, a major tarred highway connecting Zomba to Blantyre and Liwonde, or via route S131, which is a gravel road that runs west of Lake Chilwa and passes through Domasi and Chibwana. The closest international airport is located in Blantyre, approximately 100km from the Project.
We hold three licenses that grant us the exclusive rights to carry out exploration for certain HMS and REE in the license areas. Our 100% owned subsidiary, Chilwa Minerals Africa Limited, holds two licenses that grant us the exclusive rights to carry out exploration for certain HMS and REE in the license areas. Exploration License Number EL0670/22R1, originally granted on September 27, 2022 and currently valid until July 17, 2028, covers an area of 418.2851 km2 around Lake Chilwa, including the districts of Phalombe, Zomba and Mulanje. Exploration License Number EL0671/22R1, originally granted on September 26, 2022 and currently valid until July 17, 2028, covers an area of 12.84 km2 on Chisi Island in the district of Zomba. In addition, our 100% owned subsidiary, Phalombe Minerals Limited, has been granted an exploration license EL0835/25, valid from July 18, 2025 to July 17, 2030, covers an area of 449.8885 km2, with the option to extend, to carry on exploration activities in Mulanje, Phalombe and Zomba Districts.
The initial term of an exploration license is five years from the date of grant. A holder may apply for extensions of the term for periods of up to three years, but no more than two such extension applications may be made. Exploration License Number EL0670/22R1 and Exploration License Number EL0671/22R1 have already been renewed once. In terms of applicable law, when applying for the extension of the term of an exploration license, the applicant must reduce the size of its last approved area by at least half. Local authorities in Malawi have no discretion to waive this requirement. The exploration area of Exploration License Number EL0670/22R1 has previously been reduced by 50% (from 865.86km2 to 418.2851km2).
The maintenance and extension of the licenses are subject to various conditions described under “Business - Government and Environmental Regulations” below, and the laws and regulations governing the maintenance or renewal are subject to change. In addition, future development of the Project will require obtaining licenses or permits for the construction and operation of mines, processing plants and related infrastructure. We plan to work with the Government of Malawi to secure a mining license and a mining development agreement.
Proposed Exploration Program
We are an exploration-stage company and have not established any mineral reserves at the Chilwa Critical Minerals Project, for which we have not made a development decision. Subject to available funding, access, permitting, contractor availability, seasonal conditions, laboratory turnaround and technical results, our proposed exploration program for the twelve months ending June 30, 2027 will focus on seeking heavy mineral sands resource definition, mineralogical and metallurgical test work, exploration of selected rare earth element and niobium targets, and early-stage technical, environmental and permitting studies. We expect to fund the proposed exploration program with the portion of the net proceeds of this offering allocated to mineral exploration activities, together with existing cash. See “Use of Proceeds.”
The principal elements of the proposed program are summarized below:
Heavy mineral sands resource definition. We plan to conduct infill and confirmatory sonic drilling, collar and survey validation, density checks, assay review and database validation at the Mposa, Mposa North, Bimbi, Mpyupyu, Nkotamo, Halala, Beacon and Namanja West deposits. The purpose of this work is to increase geological confidence in existing heavy mineral sands deposits and to test selected extensions of known mineralization. We expect technical outputs to include an updated drilling and assay database, updated geological interpretation and, if supported by results, a mineral resource estimate.
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Mineralogy and metallurgical test work. We plan to conduct XRF, QEMSCAN and related mineralogical analysis, representative composite sample work, slimes and oversize characterization, recovery test work and product specification assessment. The purpose of this work is to support mineral assemblage interpretation, recovery assumptions and process-design inputs. We expect technical outputs to include updated mineralogical and metallurgical assumptions for future technical studies.
Rare earth element and niobium exploration. We plan to conduct targeted diamond drilling, geological logging, geochemical analysis, petrography, mineralogical analysis and three-dimensional geological modelling at the Mpyupyu carbonatite, the Mposa REE anomaly and other selected targets. The purpose of this work is to evaluate selected rare earth elements and niobium targets and determine whether further exploration is warranted. We expect technical outputs to include refined geological models, target ranking and, if supported by sufficient data, inputs for future resource estimation work.
Technical, environmental, and permitting studies. We plan to conduct mine-method screening, infrastructure review, logistics assessment, environmental baseline work, community and land-access review and permitting work streams. The purpose of this work is to generate technical and environmental inputs for future studies and permitting processes.
Our currently proposed exploration program is evaluative in nature, and we may modify its scope, sequencing and timing as results are received. There can be no assurance that the proposed exploration program will result in the definition of mineral resources, the conversion of mineral resources to mineral reserves, the completion of a feasibility study, or a decision to develop or mine the Chilwa Critical Minerals Project.
Industry Overview and Market Opportunity
The Heavy Mineral Sands Industry
HMS is typically categorized into titanium dioxide-bearing minerals such as ilmenite and rutile (but also including leucoxene and upgraded products such as slag and synthetic rutile), zircon and monazite. The industry is primarily concentrated in Australia, though South Africa, India and China are also major producers. Other countries with significant HMS deposits include the U.S., Brazil and Mozambique.
The market for HMS products is driven by a wide range of factors, including global economic growth, industrial demand, and technological innovation. In recent years, the market has faced a number of challenges in line with general economic conditions, including declining demand for certain products, increased competition from alternative materials, and the general environmental concerns related to all mining and processing.
Ilmenite and rutile are primarily used as feedstock for the production of titanium dioxide (“TiO2”) pigment with a small percentage also used in the production of titanium metal and fluxes for welding rods and wire. Titanium, which can be extracted from TiO2, is included on the U.S. Interior Department’s list of critical minerals. TiO2 is the most widely used white pigment because of its nontoxicity, brightness and very high refractive index. It is an essential component of consumer products such as paint, plastics and paper. Pigment demand is therefore the major driver of ilmenite and rutile pricing. Weak conditions persisted for the global pigment market due to ongoing economic weakness and uncertainty across major pigment consuming regions. This has resulted in declining demand and price erosion for both ilmenite and rutile. Chinese pigment producers continue to experience challenges from steep tariffs that have been applied to Chinese pigment imports in the key markets of Europe, Brazil and India. Chinese pigment prices have continued to decline as Chinese producers compete to maintain market share in these markets. Pigment production in China is the major global source of demand for sulphate ilmenite, and Chinese pigment output has decreased as overall weak conditions in the domestic Chinese pigment market and major pigment export markets add to the challenges presented by the tariffs. The tariffs imposed on Chinese pigment in the key markets mentioned above are expected to result in a shift of some demand from Chinese pigment producers to western pigment producers. Western pigment producers are the main source of demand for chloride ilmenite and high-grade feedstocks including rutile. Chloride ilmenite, regarded as a niche feedstock for western pigment production with a high relative economic value, is typically purchased under long-term offtake arrangements and generally experiences limited short-term price fluctuations.
Demand for rutile into the welding and titanium metal sectors remains firm. The main drivers of demand have been the shipbuilding and aerospace industries combined with sanctions on Russian-supply of raw materials. The extent of the rutile price premium into these sectors (above pigment sector pricing) is being eroded due to an excess of global supply, including an increase in production of premium rutile in China from concentrates being imported into China from Africa.
Zircon is a coproduct or byproduct of the mining and processing of HMS for the titanium minerals, ilmenite and rutile, or tin minerals. Zircon has a range of end-uses, the predominant of which is in the production of ceramic tiles, accounting for more than 50% of global zircon consumption. Milled zircon enables ceramic tile manufacturers to achieve brilliant opacity, whiteness and brightness in their products. Zircon’s unique properties include heat and wear resistance, stability, opacity, hardness and strength, making it sought after for other applications such as refractories, foundries and specialty chemicals. Demand growth for zircon is closely linked to growth in global construction and increasing urbanization in the developing world. Zircon demand in China, the largest global consumer of zircon, remains weak on the back of a subdued housing and construction market. Zircon prices have, therefore, continued to trend downward. Zircon can be processed to extract zirconium, which is a chemical element included on the U.S. Interior Department’s list of critical minerals as the United States recognizes its strategic value. Zirconium is used in nuclear fuel cladding, chemical piping in corrosive environments, heat exchangers, and various specialty alloys.
We believe demand for ilmenite, zircon, and rutile will continue to grow, driven by forecasted economic growth and sustained consumption in pigments, ceramics, and other mature end-use markets.
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The Rare Earth Elements Industry
REEs are a group of 17 chemical elements (the 15 elements in the lanthanum series, plus yttrium and scandium) that are integral to a myriad of modern applications, from consumer electronics to national defense systems. Individual rare earth elements serve distinct and critical functions across various industries. For example, lanthanum is utilized in camera lenses and battery electrodes, cerium finds applications in catalytic converters and glass polishing, europium is a key component in red phosphors for LED displays, gadolinium is employed as a contrast agent in magnetic resonance imaging (MRI), whereas neodymium and praseodymium are essential for manufacturing high-strength permanent magnets used in EV motors and wind turbines.
The proliferation of smartphones, electric vehicles, and renewable energy technologies has increased demand for specific rare earth elements. The global shift towards green energy solutions has further amplified the demand for these elements, as nations strive to meet ambitious carbon reduction targets. The unique properties of each element make them indispensable in their respective applications, underscoring the strategic importance of securing a stable supply. As demand for clean energy and other advanced technologies increases in the coming years, we expect further increases in REE demand and prices, as well as new supply sources.
China is the dominant player in the global rare earths market, holding the largest reserves and controlling a significant portion of the processing capacity. Other countries, such as Brazil and Australia, hold significant REE reserves but face challenges in competing with China’s established infrastructure. As the U.S. aims to enhance its technological capabilities and reduce reliance on foreign sources, securing a stable supply of rare earths has become a national priority. However, the country is heavily dependent on imports, with over a majority of its rare earths coming from China. This reliance poses significant risks, particularly in light of ongoing trade tensions and geopolitical challenges. The U.S. government has recognized the strategic importance of rare earths and is actively seeking to bolster domestic production and processing capabilities to ensure a resilient supply chain for critical minerals.
Our Competitive Strengths
We believe that our high-quality asset base and differentiated approach distinguish us from our peers and create a unique opportunity for growth and value creation. Our competitive strengths include:
Integrated Multi-Commodity Resource Base
The co-location and integration of both HMS and REE within the project area is a key differentiating feature of the Project. While other operators in Malawi have generally pursued single-commodity or dual-commodity strategies, the Company’s Lake Chilwa project encompasses HMS, REE and niobium across multiple deposit types, including alluvial mineral sands, ionic adsorption clays, monazite-bearing sands, and carbonatite-hosted mineralization.
This multi-commodity endowment creates the potential for an integrated processing pathway whereby HMS production may generate near-term revenue while REE and niobium exploration and development activities advance in parallel. We believe that this staged development approach, commencing with HMS as the initial production focus, reduces project risk by potentially enabling early cash flow generation from a relatively lower-complexity processing operation, while the higher-value REE and niobium components progress through feasibility assessment.
Historic Strategic Mota-Engil Relationship
The support of our ultimate major shareholder, Mota-Engil Group, positions us well for continued success. Founded in 1946, Mota-Engil is a global engineering and construction group with approximately 50 years of operational experience across Africa and has a long and successful track record of operating in Malawi, as well as a significant presence in Europe, Latin America and other parts of Africa across sectors such as engineering and construction, environment and services, transport concessions, energy, and mining. Historically, we have had drilling and services agreements with Mota-Engil Engenharia e Construção Africa, S.A. (“ME Africa”), a member of the Mota-Engil Group, which allowed us to benefit from Mota-Engil’s significant infrastructure and presence at a rate that is significantly lower than if sourced from third-party suppliers. Such agreements provided us with access to heavy earthmoving equipment, construction capability, and established operational infrastructure in the region. As we grow, we have begun building our own internal capabilities and using third-party contractors where appropriate. At the same time, we believe that we can continue to call upon expertise from Mota-Engil as necessary and this provides a meaningful competitive advantage relative to peers that do not have comparable strategic partnerships.
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Resource Characteristics and Processing Flexibility
The HMS assemblage at our Mpyupyu deposit includes ilmenite (approximately 76% of the heavy mineral concentrate), zircon (approximately 9.5%), and monazite (approximately 2-3%), providing a diversified revenue stream from a single processing operation. The presence of monazite within the HMS assemblage also provides a secondary source of REE recovery from mineral sands processing, further distinguishing our integrated approach.
Additionally, our exploration activities have confirmed the presence of REE-bearing ionic adsorption clays beneath the HMS deposits and adjacent to hard-rock targets, with elevated total rare earth oxide values identified at the Mposa anomaly. We are also evaluating the potential for high-grade REE carbonatite mineralization at Mpyupyu. This diversity of REE mineralization styles—from monazite in HMS, ionic clays, and carbonatites—is uncommon in the Malawian context and provides us with multiple pathways for REE development.
Strong commitment to our people, our communities, and the environment
We are committed to the sustainable exploration of our projects by deeply embedding environmental, social and governance criteria in our decision-making framework. We have held positive meetings with local communities and government representatives in Zomba, Malawi. These interactions have been crucial in building trust and ensuring that our activities align with the interests of our stakeholders. We are committed to maintaining open and constructive dialogue as we progress.
Experienced team with a proven track record
We have an experienced management team with a proven track record. Our Chairman, Alexander Shaw, is a highly accomplished geologist with over 15 years of global experience in exploration and production. He has spent the majority of his career exploring for and developing diamond, base and precious metal deposits within Africa, Central and South America. Having obtained his DPhil from the University of Oxford on the geology of the Mega Kalahari Basin and having managed and developed projects in Angola, Zambia, DRC, Botswana and Namibia with First Quantum Minerals and BHP, he has significant knowledge of the region. Our Managing Director and Chief Executive Officer, Cadell Buss, is a multi-industry senior executive with over 20 years’ experience in marketing, project development, and capital markets, and has consulted to a number of ASX-listed companies with African-based assets. Our CFO, Mark Laybourn, is a Fellow Chartered Accountant with over 20 years of finance leadership experience. Our Non-Executive Directors, Manuel Mota and Jose Martins, also have extensive experience in the construction, engineering, mining, and natural resources sectors.
Our Growth Strategies
We believe we can achieve our goal by executing the following strategies:
Planned exploration strategy
We plan to continue engaging in sonic drilling, defining Mineral Resource Estimates, feasibility studies, diamond drilling, assay results, and scoping studies, among others, to systematically advance our HMS, REE, and niobium projects. These efforts will also help us progressively de-risk the project and better position us for development decisions. Looking ahead, we will remain focused on advancing the Project and exploring new opportunities to enhance shareholder value. Our proposed exploration program for the twelve months ending June 30, 2027 is described above in “Business — Chilwa Critical Minerals Project — Proposed Exploration and Evaluation Program”.
Drive additional cost efficiencies in our operations
We intend to leverage our expertise and extensive mining exploration experience to implement operational improvements and continue identifying and evaluating new opportunities to reduce operating costs and improve efficiency. For example, as part of our exploration activities, we procure sonic and diamond drilling services through several drilling services agreements, operating more than one drill rig from more than one supplier during our current exploration programs. Such agreements are program or meterage based, do not contain exclusivity provisions, may be terminated by either party on written notice, and entitle us to procure substitute services from third parties. In addition, we are beginning to bring some services in-house. We have already acquired a preparation lab to process samples for assaying, are in the process of acquiring an assay lab and are in the process of purchasing our own diamond drill rig.
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Maintain safe and sustainable operations for our employees, communities and shareholders
Our safety-first and community development approaches to doing business will remain a core tenet of our operational focus and business strategy. We believe that continuing to focus on our people, communities, and the environment will position us to attract the best local talent and ensure that we have efficient, stable, and long-term operations that continually elevate the people around our operations and where they live.
Continue to strengthen our relationship with the Government of Malawi
The Government of Malawi considers agriculture, tourism, and mining as key focus sectors for the economic growth of Malawi. Building on our mutual understanding with the Government of the importance of developing a vibrant mining sector to the Malawi economy, we plan to work with the Government to secure a mining license and a mining development agreement.
Quality Assurance and Quality Control
Scientific and technical information contained in this registration statement on Form F-1 was reviewed and approved by Bernhard Siebrits, Consulting Resource Estimation Geologist at mineral resource consulting firm, Belenos Holdings (Pty) Ltd, who is a member of the Australasian Institute of Mining and Metallurgy (“Qualified Person”). Mr Siebrits is a “qualified person” as defined in subpart 1300 of Regulation S-K. Belenos Holdings (Pty) Ltd serves as our consultant.
The Qualified Person has reviewed the data collection and verification procedures followed by Chilwa and by third parties on behalf of Chilwa, and believes these procedures are consistent with industry best practices and acceptable for use in geological and resource modelling.
We have established internal controls relating to Quality Assurance and Quality Control (QA/QC) as necessary in relation to our exploration of our properties. These protocols include, but are not limited to:
| ● | Sonic core drilling procedures include logging the core at the rig as a first pass, then relogged and sampled at the Chilwa base camp; |
| ● | Sampling is based on geological changes observed in the core, with a standard sample length of 1.0m. Samples are first prepared through initial drying, crushing to 80% passing 3mm and splitting of sub-samples on a rotary splitter at our own sample preparation facility in Zalewa, Malawi; |
| ● | This generates a representative split sub-sample of 500g for heavy liquid separation assay at LightDeepEarth, a laboratory in South Africa, to be analyzed for slimes percentage, oversize percentage and THM percentage; |
| ● | Samples are submitted with two types of reference samples to monitor assay quality; | |
| ● | Coarse blanks are prepared to control for potential cross-contamination of samples; | |
| ● | Duplicates for analysis are submitted and lab repeats are carried out; and | |
| ● | All assay results used in the verification process by the Qualified Person were obtained from fully certified analytical laboratories with signed assay certificates. |
Material Agreements
We are not party to any material agreements, since all of our agreements have been made in the ordinary course of business.
Seasonality
We operate continuously throughout the year. Access to the Project area in the dry season (May to October) is straightforward, but access can be difficult in the wet season (November to April).
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Intellectual Property
We do not hold any patents and are not dependent on intellectual property (including patents or licenses), industrial, commercial or financial contracts (including contracts with customers or suppliers) or new manufacturing processes for the conduct of our business as a whole.
Property
Our 100% owned subsidiary, Chilwa Minerals Africa Limited, holds two licenses that grant us the exclusive rights to carry out exploration for certain HMS and REE in the license areas. In addition, our 100% owned subsidiary, Phalombe Minerals Limited, has been granted an exploration license. Such exploration licenses are as described in the following table:
| Exploration License Number | Subsidiary holding Exploration License | Date First Granted | Valid Until | Area Covered | Region Covered | |||||
| EL0670/22R1 | Chilwa Minerals Africa Limited | September 27, 2022 | July 17, 2028 | 418.2851 km2 | Phalombe, Zomba and Mulanje Districts | |||||
| EL0671/22R1 | Chilwa Minerals Africa Limited | September 26, 2022 | July 17, 2028 | 12.84 km2 | Chisi Island in Zomba District | |||||
| EL0835/25 | Phalombe Minerals Limited | July 18, 2025 | July 17, 2030 | 449.8885 km2 | Mulanje, Phalombe and Zomba Districts |
Government and Environmental Regulations
We are subject to a wide range of laws and regulations governing all aspects of our operations, including with respect to investment and exchange controls, environmental protection, exploration, development, taxes, immigration, labor standards and employment issues, occupational health, toxic substances and wastes, securities, and foreign corrupt practices. Complying with these laws and regulations requires significant expenditures, and non-compliance can result in violations, legal claims, fines, penalties, reputational damage, and delays in or suspension of day-to-day operations. Pending or proposed changes to existing laws and regulations, as well as any proposed or contemplated new laws or regulations, could also have significant impacts on our business and results of operations, the extent of which cannot always be predicted.
Our exploration licenses, Number EL0670/22R1, Number EL0671/22R1 and Number EL0835/25, are governed by the Mines and Minerals Act No. 25 of 2023 (the “Mining Act”) and the conditions stipulated in the licenses, and other applicable laws of Malawi. Under the Mining Act:
| ● | The holder of an exploration license shall have the right, within its license area, to search for all types of minerals and mineral occurrences; apply on an exclusive first-come, first-considered basis for a retention license or a mining license; erect camps and temporary buildings; erect installations in any waters for exploration purposes; remove any camps, temporary buildings or installations the holder erected; fly over the area for the purpose of performing geophysical or other aerial surveys; use remote sensing to gather data and useful information to understand the area’s geological, environmental and geographical attributes; enter upon any part of the license area for the purpose of carrying out exploration on that land; request a land access order pursuant to section 221 of the Mining Act; conduct drilling, trenching and pitting works; take and remove specimens and samples not exceeding such limit as is required for exploration and to analyze said specimens; surrender part or all of the license area subject to meeting the surrender requirements imposed under the Mining Act; and do all other things necessary or expedient for the undertaking of exploration on the land. |
| ● | The holder of an exploration license shall (i) conduct exploration in accordance with its approved exploration work program, the conditions of its license, the Mining Act, and applicable law, in a good and professional manner consistent with good practice in the mining industry; (ii) commence exploration fieldwork, where the fieldwork is part of its approved exploration work program, within 180 calendar days of the date of grant of the license; (iii) where the Mining and Minerals Regulatory Authority (“Authority”) requires, provide temporary training attachments, within its operations, to an officer in the Authority’s office or the Department of Geological Survey for a period not exceeding 30 days; (iv) notify the Authority when there is change in the control of the company that holds the license; (v) pay compensation for damages caused by its work as required under section 216 of the Mining Act; (vi) submit all reports required under the Mining Act; (vii) expend in, on, or in relation to the exploration license area the minimum annual amount required; and (viii) pay annual ground rentals. |
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| ● | The initial term of an exploration license is five years (however, under the previous Mining Act, the initial term was three years); a holder of an exploration license may apply for an extension of the term of its license for a period of up to three years; and an application for extension of the term of an exploration license may be made on not more than two occasions with a mandatory relinquishment of at least 50% of the license area on each extension. However, if such relinquishment would result in a license area of less than 25 km², the holder of such an exploration license may apply for and have approved an area of up to 25 km². |
| ● | Where a mineral tenement is held by a company and there is a change in the control of the company occasioned by a sale of a majority ownership interest or a majority of its shares, the holder of the mineral tenement shall, within 14 calendar days, notify the Authority. |
| ● | Subject to limited exceptions, the Authority may, by notice in writing served on the holder of the mineral tenement license, suspend or cancel the license, where the holder of the mineral tenement license (i) fails to use, in good faith, the land the subject of its license for the purpose for which the license was granted; (ii) uses that land subject of its license for any purpose other than the purpose for which its license was granted; (iii) fails to comply with any requirement of the Mining Act with which it is bound to comply and is not exempt from compliance under the Mining Act; (iv) fails to comply with a condition of its license and is not exempt from compliance under the Mining Act; (v) fails to comply with a direction lawfully given under the Mining Act or with a condition on which any certificate of surrender is issued or on which any exemption or consent is given under the Mining Act; (vi) fails to comply with the conditions relating to the exercise of its rights under its license; (vii) fails to pay any amount payable by the license holder under the Mining Act within two months of the amount becoming due; or (viii) does or fails to do anything specified in the Mining Act where the respective provision of the Mining Act requires suspension or cancellation. |
Our exploration licenses, Number EL0670/22R1, Number EL0671/22R1 and Number EL0835/25 permit us to explore for HMS and REE subject to the following terms and conditions:
| ● | conduct approved exploration program (mapping, sampling, analysis, feasibility studies); |
| ● | conduct operations in accordance with the approved Environmental and Social Management Plan (“ESMP”); |
| ● | start operations within 180 days and perform community consultations before beginning work; |
| ● | meet minimum annual exploration expenditure as per regulations; |
| ● | prioritize employment and training of Malawian citizens; hire non-citizens only where skills are unavailable locally; |
| ● | procure goods/services locally where competitive; use local subcontractors through transparent tendering; import equipment through Malawi-based traders; |
| ● | comply with all exploration license laws, protect the environment, rehabilitate disturbed areas, manage excavations safely, and prevent pollution, particularly of watercourses; |
| ● | indemnify the Malawian government, and submit all statutory required reports (expenditure, mid-year, annual technical); and |
| ● | license may be cancelled under applicable laws. |
Mining and sales
To mine and sell mineral products we must obtain and maintain a mining license issued by the Authority under the Mining Act. An applicant applies for either a medium-scale mining license or a large-scale mining license, which is determined by annual tons of production (excluding waste), the number of employees following construction and the proposed capital investment in the first ten years of the project.
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Environmental and social approvals
Prior to the issue of a mining license by the Authority, the Malawi Environmental Protection Authority (“MEPA”) must issue written approval under the Environmental Management Act, 2017. No mining license can be issued without MEPA’s written confirmation.
Export permits
The export of minerals with commercial value requires a mineral export permit. Exporting without the permit is an offence subject to fines and other penalties.
Mining Development Agreements
Following the grant of a mining license, large-scale operations typically negotiate a Mining Development Agreement (“MDA”) with the Malawian government (led by the Ministry of Finance and Ministry of Mining). MDAs ordinarily contain fiscal, tax, exchange-control support and other undertakings but do not replace statutory approvals. The MDA is governed by Malawian law.
Status
Before a company receives a mining license and enters into a MDA, and provided its exploration licenses remain in full force and effect, the company remains in the exploration stage during which it engages in exploration activities; advances technical studies and ESIA work; prepares the license application (including the required plans such as the mining operations plan, mine waste management plan, rehabilitation and mine closure plan, employment and training plan, goods and services procurement plan, resettlement management plan, community engagement plan, and, for a large-scale mining license, a feasibility study); and engages the Authority and MEPA as required under law.
Our business and operations are subject to extensive regulation under the laws of Malawi. These regulate our ability to explore for, develop, mine, export and sell mineral products, finance our operations, manage foreign currency flows and distribute returns to investors. The principal regulatory authorities and their respective areas of oversight are described below.
Mining regulation
Mining activities in Malawi are governed primarily by the Mining Act, and the regulations promulgated thereunder. The Authority is the primary regulatory body responsible for administering the mining regime and has authority to receive and process mineral tenement applications, grant, renew, suspend or cancel licenses, maintain the mineral tenements register, monitor compliance with license conditions and enforce the Mining Act.
The Company’s operations are dependent on the continued validity of its mining licenses (whether exploration or mining) and on compliance with prescribed work programs, reporting obligations, approved technical and operational plans, payment of ground rent and royalties, and other statutory obligations. Failure to comply with applicable mining laws or license conditions could result in administrative sanctions, suspension or cancellation of licenses, or delays in project development.
Environmental regulation
Environmental regulation applicable to mining operations is principally found in the Environment Management Act and related regulations. MEPA is the regulator responsible for environmental approvals, monitoring and enforcement.
Projects that require an environmental and social impact assessments (ESIA) may not proceed unless MEPA issues written approval of the project. MEPA also regulates waste management, water abstraction and effluent discharge, air emissions, hazardous substances, noise and environmental audits. Compliance with environmental legislation requires the Company to incur significant upfront and ongoing costs, including costs associated with environmental studies, mitigation measures, rehabilitation planning, financial assurance for mine closure and periodic reporting and inspections.
MEPA has the power to impose administrative penalties, suspend or revoke environmental approvals and prosecute environmental offences.
Other regulatory authorities
Depending on the scope of the Company’s activities, additional regulatory bodies may have oversight over specific aspects of the project, including the National Water Resources Authority (water abstraction and effluent discharge permits), the Malawi Energy Regulatory Authority (power generation or electricity supply arrangements), and immigration and labor authorities (work permits and employment compliance). Each of these regimes imposes compliance obligations that may affect project costs and timelines.
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ESIA and permitting
Compliance requires baseline studies, ESIA preparation and approval, ongoing adherence to MEPA permit conditions and environmental quality standards (air, water, effluent, waste, noise). These steps typically require third-party consultants, stakeholder engagement and design/mitigation investments, with ongoing monitoring, reporting and audit exposure.
Mine waste, tailings, rehabilitation and closure
A mining license application must include a mine waste management plan and a rehabilitation and mine closure plan (with post-closure monitoring). Before mining commences, the holder must post financial assurance (e.g., letters of credit, performance bonds, trust funds or combined instruments) and update it periodically as plans evolve - tying up collateral or cash and adding carrying costs.
Liability and sanctions
The Mining Act imposes strict liability on holders of mineral tenements for harm or damage caused by mining or mineral processing operations and mandates statutory compensation mechanisms. In addition, under the Environment Management Act, 2017, MEPA may impose administrative penalties, suspend or revoke environmental approvals, and prosecute environmental offences, which could result in work stoppages, project redesigns, or increased capital and operating costs.
Community, resettlement and social spend
Large-scale projects must conclude Community Development Agreements and spend ≥0.45% of annual gross sales on community development; projects requiring resettlement must implement a Resettlement Management Plan with compensation consistent with statute, which increases pre-production costs and requires staged cash flows during development and operation.
Foreign exchange transactions are governed by the Foreign Exchange Act, 2025 (the “FE Act”). The Reserve Bank of Malawi (“RBM”) is the authority responsible for administering the foreign exchange regime. The FE Act regulates, among other matters, capital inflows and outflows, the operation of foreign currency accounts, offshore bank accounts, export proceeds, foreign currency payments and the repatriation of dividends, interest and capital. RBM retains broad discretion in the granting and administration of approvals.
Repatriation of Export Proceeds and Mandatory Conversion into Local Currency
Malawi applies a mandatory conversion ratio on the repatriation of export proceeds to Malawi, meaning a proportion of export proceeds must be converted into local currency. The mandatory conversion ratio is currently set at 25%.
The FE Act requires all exporters to register with the RBM. All export proceeds that enter Malawi to a resident account must represent a return for the goods and reflect the true export value of the goods. In terms of the FE Act, read with the Foreign Exchange (Repatriation of Export Proceeds) Directive, 2025 (the “Export Proceeds Directive”) issued by the RBM, export proceeds are required to be declared and repatriated to Malawi and are subject to mandatory conversion into local currency.
An exporter may apply to the RBM for an exemption of the mandatory conversion requirement where the applicant:
| ● | can show at least 10% growth in export quantities over the previous four years; |
| ● | manufacturers and can demonstrate minimum 35% value addition over the prior four years; |
| ● | proves that 70% of raw materials used over the previous four years were locally sourced; |
| ● | shows that no more than 30% of service fees paid in the previous four years went to foreign service providers; |
| ● | demonstrates that 80% of total remuneration over the previous four years was paid to Malawian employees; and |
| ● | demonstrates that their export prices are not more than 5% below comparable global prices. |
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As a general principle, a registered exporter may not be paid for goods or services into an offshore bank account, however, the Export Proceeds Directive permits an exporter to open a foreign-currency denominated bank account in Malawi. In addition, registered exporters are entitled to open offshore bank accounts, however, repatriable funds which relate to export proceeds cannot be deposited directly into those accounts in terms of the FE Act. If foreign currency denominated funds held in Malawi are to be transferred to such offshore account, that can only occur in accordance with RBM procedures and approvals. Failure to comply with these requirements may attract administrative penalties. In addition, the failure to repatriate foreign currency within 120 days from the date of export shall attract a fine of 150% of the value of the goods or services and the RBM may deregister the exporter.
It should be noted that in terms of an Executive Order of the President of Malawi dated October 23, 2025 and with effect from October 21, 2025, the exportation of all raw minerals extracted in Malawi is prohibited – including for HMS and REE. The prohibition does not apply to minerals that have been processed, refined or value-added in Malawi. Persons found in violation of this Executive Order shall be subject to fines, penalties and such other sanctions as may be applicable under Malawi law.
Local Payments in Foreign Currency
The FE Act prohibits the use of foreign currency in domestic commercial transactions unless the RBM’s prior written permission is obtained. A breach of these prohibitions constitutes an offence under the FE Act. Specifically, the FE Act restricts any person in Malawi from:
| ● | quoting prices for goods or services in foreign currency; |
| ● | indexing or determining the Malawi Kwacha amount payable for local goods or services by reference to foreign currency; |
| ● | accepting quotations in foreign currency; or |
| ● | demanding or making payment in foreign currency for goods or services supplied within Malawi. |
Dividends and Repatriation of Capital
The FE Act provides that any person intending to make a capital transfer into or out of Malawi (which includes loans, equity injections, or any other form of capital investment) must first obtain prior written approval from the RBM. In practice, foreign investors are required to register their investment with the RBM to secure the right to remit dividends, service shareholder loans, and repatriate capital upon disinvestment.
Government Equity Interest
Under Section 260 of the Mining Act, the Malawian government retains a statutory right to acquire a free, non-dilutable equity interest in any company that applies for a large-scale mining license. This option may be exercised at no cost to the Malawian government, and does not require the Malawian government to contribute capital, fund project costs, or assume operational obligations. The Malawian government’s equity participation right becomes exercisable upon submission of a large-scale mining license application and expires once the license is either granted or denied.
While the Mining Act does not expressly state the extent of the Malawian government’s equity interest, current market practice shows that the Malawian government typically takes a 10% equity interest, although in theory, this could be higher or lower.
The Mining Act requires the Authority to recommend whether this option should be exercised, after which the Minister responsible for mining, following consultation with the Minister of Finance, must notify the applicant within 30 days. Failure to issue a decision within this statutory period results in a deemed waiver of the Malawian government’s participation right.
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If the Malawian government elects to take up its free equity interest, the applicant must:
| ● | issue the required equity to the Malawian government before the license is granted; |
| ● | enter into a shareholder agreement outlining minority-protection rights and profit-distribution terms; |
| ● | appoint a board member nominated by the Government of Malawi; and |
| ● | satisfy all other licensing requirements prior to license issuance. |
This Malawian government equity does not create any exemption from taxes, royalties, duties, rentals, or other statutory fees for the company.
The Malawian government may later divest its interest, and any acquirer inherits future project obligations proportionate to the acquired stake. The Malawian government also retains the right to negotiate additional participation on a market-value basis.
Legal Proceedings
We are not involved in any material legal proceedings, nor are we aware of any legal proceedings threatened or in which any director or officer or any of their affiliates is a party adverse to our Company or has a material interest adverse to us.
Competition
We compete with other mining and exploration companies in connection with respect to the acquisition of mining claims, the amount and quality of mineral reserves and resources, capital, and the recruitment and retention of qualified managerial and technical employees. In addition to our company, there are several other mineral sands projects in Malawi at various stages of development, such as Sovereign Metals, Mawei Mining, Crown Minerals Ltd, and Globe Metals & Mining Ltd. Some of these companies are larger than us, have greater financial resources or have been in the mining business for much longer than we have, and may therefore be in a better position through size, finances, and experience to acquire suitable exploration and development properties. We may not be able to compete against these companies in acquiring new properties and/or qualified people to work on our current project, or any other properties that may be acquired in the future.
Employees
As of June 30, 2026, we had 40 employees, of which 39 were full-time employees. Of our 40 employees, 37 employees are based in Malawi and 3 are based in Australia. In Malawi, we have 3 employees providing administrative services, 1 employee providing accounting services, 7 geologists, 2 diamond core samplers, 1 trainee logger, 14 sample preparation technicians, 2 laboratories personal (a laboratory supervisor and a lab technician) and 7 support staff. In Australia, we have 1 Managing Director, 1 employee providing accounts payable services and 1 corporate services manager.
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Directors and Senior Management
The following table sets forth our directors and senior management, their age and the positions. There are no family relationships among any of the members of our board of directors and our senior management.
| Name | Position | |
| Cadell Buss | Chief Executive Officer and Managing Director | |
| José Martins | Director | |
| Manuel Mota | Director | |
| Graham Hewson | Director | |
| Alexander Shaw | Chairman | |
| Mark Laybourn | Chief Financial Officer |
Cadell Buss. Cadell Buss has been our Chief Executive Officer and Managing Director since February 2022. Mr. Buss is a multi-industry senior executive with over 20 years’ international experience in marketing, project development and capital markets. Mr. Buss was the CEO of Western Australia’s longest serving stockbroking firm DJ Carmichael for 4.5 years and has consulted for a number of ASX-listed companies with African based assets. Mr. Buss was previously Project and Finance Director with Luso Global Mining (Luso), an angel investor to African based exploration companies. Mr. Buss is also a director of Atlas Pearls Ltd (ASX: ATP). Mr. Buss has a Masters degree in Project Management, an MBA from Murdoch University and is a graduate of the Australian Institute of Company Directors.
José Martins. José Martins has been a Director since October 2025. Mr. Martins is a finance executive with over 25 years’ experience in the management of public and private companies. Mr. Martins previously held CFO roles with Alliance Mining Commodities Limited (owner of a major bauxite project in Guinea, West Africa) and ASX listed Macmahon Holdings Limited and Ausdrill Limited (now part of Perenti). Mr. Martins qualified as a Chartered Accountant in South Africa, and holds a Bachelor of Accountancy (with distinction) from the University of Witwatersrand, Johannesburg, and is a graduate of the Australian Institute of Company Directors. Mr. Martins has also served as director of GenusPlus Group Limited since 2018. Mr. Martins has also served as director and Chairman of Atlas Pearls Ltd since May 2024 and January 2025, respectively.
Manuel Mota. Manuel Mota has been a Director since April 2023. Mr. Mota is a board member of Mota-Engil Group, which indirectly owns approximately 31% of Chilwa, and has been its Chief Business Development Officer since June 2021. Mr. Mota has been a board member of Mota-Engil Group since February 2016, when he was also appointed CEO for Africa, and he was subsequently also appointed as CEO for Middle East and Europe in March 2019. Previously, Mr. Mota was a member of the board of Mota-Engil Europe Engineering & Construction. Mr. Mota has acted as Chief Executive Officer for Mota-Engil Central Europe since May 2013, which included responsibility for Poland, Czech Republic and other central European countries. Mr. Mota started working as an engineer at Mota-Engil Group in Angola since 2009 and also served as director of Mota-Engil Angola. He graduated with a Masters in Civil Engineering from University College London.
Alexander Shaw. Alexander Shaw has been a Director since February 2022 and was appointed as our Chairman in October 2023. Mr. Shaw is an accomplished geologist with more than 15 years of global experience in mineral exploration and production. Mr. Shaw spent the majority of his career exploring for and developing diamond, base and precious metal deposits within Africa and Central and South America. Mr. Shaw has significant knowledge of the Africa region, having obtained his DPhil from the University of Oxford on the geology of the Mega Kalahari Basin and having managed and developed projects in Angola, Zambia, DRC, Botswana and Namibia with First Quantum Minerals and BHP. Mr. Shaw is a Fellow of the Geological Society of London and a member of the following professional bodies: Australian Institute of Geoscientists, Southern Africa Institute of Mining and Metallurgy, American Institute of Professional Geologists and the Society of Economic Geologists. Mr. Shaw is the chief executive officer and managing director of Luso Global Mining BV, which is a principal shareholder of Chilwa.
Graham Hewson. Graham Hewson has been a Director since April 2026. Mr. Hewson is an accomplished industrial leader with more than 30 years of global experience in the mineral sands mining, titanium dioxide and titanium metal sectors. Mr. Hewson has expertise in enterprise-wide transformation, greenfield and brownfield project development and strategic mergers and acquisitions. Most recently, Mr. Hewson served as Executive Vice President, Titanium Operations at The National Titanium Dioxide Company Limited (Cristal, now Tronox Holdings plc), where he held operational accountability for a global portfolio spanning heavy mineral sands extraction, high-grade titanium dioxide production and specialized smelting operations. Mr. Hewson currently serves as director of Coogee Chemicals Pty Limited and director of Australian Gold Reagents (WESEF Group). He also provides executive advisory services to companies in the chemical and resource sectors. Mr. Hewson received his Master of Leadership and Management and Bachelor of Science in chemical engineering from Curtin University in Australia.
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Mark Laybourn. Mark Laybourn has been our Chief Financial Officer since February 2026. Mr. Laybourn is a Fellow Chartered Accountant with over 20 years of finance leadership experience spanning corporate transactions, consulting, and executive management. Mr. Laybourn was a senior finance executive at HBF Health Limited for 5 years from July 2020 to November 2025, serving as Chief Financial Officer of HBF Wellness, Acting Chief Financial Officer of HBF Health, General Manager, Group Finance, and General Manager, Commercial Finance. Mr. Laybourn was previously the Chief Financial Officer of Digital CC Limited (ASX: DCC) from June 2014 to April 2015, during which he led its ASX listing, the world’s first blockchain technology company to list on a public exchange and scaled the business to A$40 million in revenue in its first 12 months. Mr. Laybourn also previously headed Deloitte’s CFO Advisory and Digital Controllership practices in Perth from January 2018 to June 2020 and was a Senior Manager at Accenture from May 2015 to December 2017. Earlier in his career, Mr. Laybourn was an Associate Director of Corporate Finance at Euroz Securities Limited from October 2008 to May 2014. Mr. Laybourn was a Non-Executive Director and Finance & Audit Committee Chair at All Saints College from January 2023 to December 2025. Mr. Laybourn does not hold any other current directorships for public companies. Mr. Laybourn holds a Master of Business Administration from the University of Western Australia and a Bachelor of Commerce from Curtin University.
Compensation
Remuneration Principles
Remuneration of all executive and non-executive directors and officers is determined by the board of directors.
We are committed to remunerating senior executives and executive directors in a manner that is market-competitive and consistent with “Best Practice” including the interests of shareholders. Remuneration packages are based on fixed and variable components, determined by the executives’ position, experience and performance, and may be satisfied via cash or equity.
Non-executive directors are remunerated out of the aggregate amount approved by shareholders and at a level that is consistent with industry standards. Non-executive directors do not receive performance-based bonuses and prior shareholder approval is required to participate in any issue of equity. No retirement benefits are payable other than statutory superannuation, if applicable.
Our remuneration policy is not directly based on our financial performance, rather on industry practice, given we operate in the mineral exploration sector and our primary focus is exploration activities with a long-term objective of developing and commercializing metals from our mineral properties.
We envisage our performance in terms of earnings will remain negative while we continue in the exploration phase.
The purpose of a performance bonus is to reward individual performance in line with our objectives. Consequently, performance-based remuneration is paid to an individual where the individual’s performance clearly contributes to a successful outcome. This is regularly measured in respect of performance against key performance indicators.
We use a variety of key performance indicators to determine achievement, depending on the role of the executive being assessed. These include the achievement of key project milestones within scheduled time and/or budget, such as completion of drilling, assay results, and feasibility studies.
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Executive Compensation
The following table sets forth all the compensation awarded to, earned by or paid to each individual who served as directors and executive officers in fiscal 2026.
| Short-term Benefits | Post Employment Benefits | Long-term (share based payments) Performance | ||||||||||||||||||||||
| June 30, 2026 | Cash salary and fees | Cash bonus | Non Monetary* | Super- annuation | Rights, Shares and Options | Total | ||||||||||||||||||
| A$ | A$ | A$ | A$ | A$ | A$ | |||||||||||||||||||
| Directors and Executive Officers | ||||||||||||||||||||||||
| Cadell Buss | 354,125 | 64,245 | — | 50,386 | 784,290 | 1,253,046 | ||||||||||||||||||
| José Martins (1) | 23,809 | — | — | 2,857 | 61,831 | 88,497 | ||||||||||||||||||
| Manuel Mota | 40,000 | — | — | — | 335,566 | 375,566 | ||||||||||||||||||
| Alexander Shaw | 80,000 | — | — | — | 447,422 | 527,422 | ||||||||||||||||||
| Graham Hewson | 6,493 | — | — | 779 | — | 7,272 | ||||||||||||||||||
| Mark Laybourn(2) | 155,100 | — | — | — | — | 155,100 | ||||||||||||||||||
| Dennis Wilkins(3) | 26,666 | — | — | — | 26,666 | |||||||||||||||||||
| Total | 686,193 | 64,245 | — | 54,022 | 1,629,109 | 2,433,569 | ||||||||||||||||||
| (1) | José Martins was appointed as Director in October 2025. |
| (2) | Mark Laybourn was appointed as Chief Financial Officer in February 2026. |
| (3) | Dennis Wilkins served as our Chief Financial Officer from October 2023 to February 2026. |
Service Agreements
The following members of key personnel have service agreements as follows:
| Cadell Buss | Managing Director and Chief Executive Officer | |
| Agreement commenced: | July 1, 2023 | |
| Details | This executive services agreement has no fixed term. Each party can terminate at will by giving twelve months’ notice. However, if the termination is for cause, no notice is required. | |
| Base salary | A$350,000 per year | |
| Alexander Shaw | Chairman | |
| Agreement commenced: | April 4, 2023 | |
| Details | This service agreement has no fixed term. This service agreement can be terminated by either party at will. | |
| Base salary | A$80,000 per year. | |
| Manuel Mota | Director | |
| Agreement commenced: | April 4, 2023 | |
| Details | This service agreement has no fixed term. This service agreement can be terminated by either party at will. | |
| Base salary including superannuation | A$40,000 per year. |
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| Mark Laybourn | Chief Financial Officer | |
| Agreement commenced: | February 17, 2026 | |
| Details | This service agreement has no fixed term. This service agreement can be terminated by either party at will by giving 1-month notice. | |
| Base salary including superannuation | A$2,350 per day of work. |
| José Martins | Director | |
| Agreement commenced: | October 16, 2025 | |
| Details | This service agreement has no fixed term. | |
| Base salary including superannuation | A$40,000 per year. |
| Graham Hewson | Director | |
| Agreement commenced: | April 27, 2026 | |
| Details | This service agreement has no fixed term. | |
| Base salary including superannuation | A$40,000 per year. |
Performance Rights
The Company does not currently have any Employee Share Option Plan or Performance Rights Plan. In the event that the directors determined that such plans were necessary, the Company would seek shareholder approval for any such plan prior to their use.
Between July 1, 2023 and June 30, 2026, the Company has issued performance rights to directors or management as part of their remuneration or as performance incentives. All these issuances have been approved by shareholders and are summarized below:
| Recipient | Quantity | Type | Shareholder approval date | |||||
| José Martins | 500,000 | Performance Rights | November 27, 2025 | |||||
| Manuel Mota | 1,500,000 | Performance Rights | November 27, 2025 | |||||
| Alexander Shaw | 2,000,000 | Performance Rights | November 27, 2025 | |||||
| Cadell Buss | 3,000,000 | Performance Rights | November 27, 2025 | |||||
| Cadell Buss | 1,500,000 | Performance Rights | November 7, 2024 | |||||
| Alexander Shaw | 1,000,000 | Performance Rights | November 7, 2024 | |||||
| Manuel Mota | 750,000 | Performance Rights | November 7, 2024 | |||||
| Cadell Buss | 1,721,740 | Performance Rights | November 30, 2023 | |||||
| Cadell Buss | 765,218 | Performance Rights | November 30, 2023 | |||||
| Cadell Buss | 956,521 | Performance Rights | November 30, 2023 | |||||
| Cadell Buss | 956,521 | Performance Rights | November 30, 2023 | |||||
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Short-term incentive
In accordance with the remuneration provisions of the Executive Services Agreement between the Company and Cadell Buss that commenced on July 1, 2023, Mr. Buss is entitled to cash bonuses upon the achievement of the following key performance indicators:
1. A$140,074 upon admittance to the Official List of the ASX within 3 months of the date of the agreement;
2. A$70,000 when: (a) 6,000 meters of drilling is completed; and (b) assay results achieved from the 6,000 meter drilling program; and
3. A$70,000 when: (a) a maiden Indicated Resources is achieved; and (b) an Indicated Resource of over 3mt of THM at 1% cut-off grade is achieved.
As at the date of this report, the achievement of each of these three milestones has been completed and payment of short term incentives has been made to Mr. Buss as disclosed in the “Executive Compensation” section above.
Long-term incentive
Performance rights have been granted to key management personnel subject to the achievement of the following key performance indicators:
| ● | Class A - the announcement by the Company of an Indicated Mineral Resource of 3 million tonnes of THM from the Project by no later than 24 months from the grant of the performance right; |
| ● | Class B - the announcement by the Company of the completion of a Pre-Feasibility Study (as defined in the JORC code) that recommends further proceeding with the Project by no later than 48 months from the grant of the performance rights; |
| ● | Class C - announcement by the Company of the completion of a Feasibility Study (as defined in the JORC Code) that recommends further proceeding with the Project by no later than 48 months from the grant of the performance rights; |
| ● | Class D - the announcement by the Company that a decision to mine the Project has been made by no later than 60 months from the grant of the performance rights; and |
| ● | Class E - the approval and issue of a Mining Licence for Chilwa Critical Minerals Project by November 30, 2028. |
For details of performance rights granted to key management personnel during the 2026 financial year, refer to the “Executive Compensation” section above.
Ordinary Share holdings
As at June 30, 2026, the numbers of shares held by our directors and officers were as follows:
| 2026 | Balance at start of the year | Received on conversion of performance rights upon achievement of milestones | Received during the year on the exercise of options | Other changes during the year | Balance at end of the year | |||||||||||||||
| Ordinary shares | ||||||||||||||||||||
| Cadell Buss | 553,796 | 1,721,740 | — | 71,654 | 2,347,190 | |||||||||||||||
| Alexander Shaw | 290,712 | — | — | 27,253 | 317,965 | |||||||||||||||
| Manuel Mota | 871,279 | — | — | 24,000 | 895,279 | |||||||||||||||
| Mark Laybourn1 | — | — | — | — | — | |||||||||||||||
| José Martins2 | — | — | — | 300,000 | 300,000 | |||||||||||||||
| Graham Hewson3 | — | — | — | — | — | |||||||||||||||
| Total ordinary shares | 1,715,787 | 1,721,740 | — | 422,907 | 3,860,434 | |||||||||||||||
| 1 | Mr. Laybourn was appointed as our Chief Financial Officer in February 2026. |
| 2 | Mr. Martins was appointed as Director on October 20, 2025. |
| 3 | Mr. Hewson was appointed as Director on April 27, 2026. |
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Performance rights
As at June 30, 2026, the numbers of performance rights held by our directors and officers were as follows. Each performance right grants the right to receive one fully paid ordinary share in the Company.
| 2026 | Balance at start of the year | Granted/(Expired) by the Company | Converted to Ordinary shares | Balance at end of the year | ||||||||||||
| Performance rights | ||||||||||||||||
| Cadell Buss | 5,900,000 | 3,000,000 | (1,721,740 | ) | 7,178,260 | |||||||||||
| Alexander Shaw | 1,000,000 | 2,000,000 | — | 3,000,000 | ||||||||||||
| Manuel Mota | 750,000 | 1,500,000 | — | 2,250,000 | ||||||||||||
| Mark Laybourn 1 | — | — | — | — | ||||||||||||
| José Martins2 | — | 500,000 | — | 500,000 | ||||||||||||
| Graham Hewson3 | — | — | — | — | ||||||||||||
| Total performance rights | 7,650,000 | 7,000,000 | (1,721,740 | ) | 12,928,260 | |||||||||||
| 1 | Mr. Laybourn was appointed as our Chief Financial Officer in February 2026. |
| 2 | Mr. Martins was appointed as Director on October 20, 2025. |
| 3 | Mr. Hewson was appointed as Director on April 27, 2026. |
Shares under option
Unissued ordinary shares of Chilwa under option on June 30, 2026, are as follows:
| Date options granted | Expiration Date |
Exercise Price |
Number | Listed/Unlisted Options | ||||||||
| 1 July 2023 | 30 June 2027 | $ | 0.25 | 83,225 | Unlisted | |||||||
| 1 July 2023 | 30 June 2027 | $ | 0.30 | 338,387 | Unlisted | |||||||
| 1 July 2023 | 30 June 2027 | $ | 0.40 | 456,261 | Unlisted | |||||||
| 877,873 | ||||||||||||
During fiscal year 2026, we issued 1,622,127 ordinary shares as a result of the exercise of options.
Board Practices
Introduction
Our Board of Directors is elected by and accountable to our shareholders. It currently consists of four directors, including three non-executive directors, of which one is the non-executive Chairman of our Board of Directors. The Chairman of our Board of Directors is responsible for the management of the Board of Directors and its functions.
Election of Directors
Directors are elected at our annual general meeting of shareholders. Under our Constitution, a director, other than a managing director, must not hold office for more than three years or beyond the third annual general meeting following his appointment (whichever is the longer period) without submitting himself for re-election. Our Board of Directors has the power to appoint any person to be a director, either to fill a vacancy or as an additional director (provided that the total number of directors does not exceed the maximum allowed by law), and any director so appointed may hold office only until the next annual general meeting (“AGM”) when he or she shall be eligible for election.
The appointment and expiration dates of each director in office is as follows:
| Name | Position | Year first appointed | Current term expires | |||
| Cadell Buss | Managing Director and CEO | 2022 | —(1) | |||
| Alexander Shaw | Chairman | 2022 | 2027 (2) | |||
| Manuel Mota | Director | 2023 | 2028 (2) | |||
| José Martins | Director | 2025 | 2028(2) | |||
| Graham Hewson | Director | 2026 | 2029(2) |
| (1) | According to our Constitution and consistent with Australian market practice, the appointment of a Managing Director is not subject to expiration. |
| (2) | Term expires on the date of the AGM for that year. |
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Corporate Governance
ASX Corporate Governance Principles
In Australia, there are no defined corporate governance structures and practices that must be observed by a company listed on the ASX, except that entities are required to have a trading policy that complies with the requirements of the ASX Listing Rules and entities of a certain size are required to have audit and remuneration committees. Instead, the ASX Corporate Governance Council has published the Corporate Governance Principles and Recommendations (“Recommendations”) which set out recommended corporate governance practices for entities listed on the ASX that, in the ASX Corporate Governance Council’s view, are likely to achieve good governance outcomes.
Under ASX Listing Rule 4.10.3, each ASX listed company is required to attach a copy of its governance statement (which has been approved by the Board) and provide a statement in their annual report to shareholders disclosing the extent to which they have followed the Recommendations in the reporting period and where they have not followed all the Recommendations, identify the Recommendations that have not been followed, and the reasons for not following them and what (if any) alternative governance practices it adopted in lieu of the Recommendations during that period. It is not mandatory to follow the Recommendations. As compliance with all the Recommendations would entail excessive costs to us, and in light of our current size, we follow most of the Recommendations, as appropriate, because the costs of complying with all the Recommendations would outweigh the benefits.
Non-Executive and Independent Directors
Australian law does not require a company to appoint a certain number of independent directors to its board of directors or audit committee. However, under the Recommendations, the ASX Corporate Governance Council recommends, but does not require, that an ASX-listed company have a majority of independent directors on its board. Our Board of Directors has determined that each of Jose Martins and Graham Hewson qualifies as an independent director under the requirements of the ASX.
Our Board of Directors does not have regularly scheduled meetings at which only independent directors are present. The Board of Directors does meet regularly and independent directors are expected to attend all such meetings.
Committees of the Board of Directors
Audit Committee. Nasdaq Marketplace Rules require us to establish an audit committee comprised of at least three members, each of whom is financially literate and satisfies the respective “independence” requirements of the SEC and Nasdaq and one of whom has accounting or related financial management expertise at senior levels within a company.
Our Audit Committee assists our Board of Directors in overseeing the accounting and financial reporting processes of our company and audits of our financial statements, including the integrity of our financial statements, compliance with legal and regulatory requirements, our independent public accountants’ qualifications and independence, and such other duties as may be directed by our Board of Directors. The Audit Committee is also required to assess risk management.
Our Audit Committee currently consists of two board members, Jose Martins and Graham Hewson. Jose Martins is a chartered accountant and satisfies the “financial expert” requirements of the U.S. Securities and Exchange Commission. Each of Jose Martins and Graham Hewson satisfies the “independence” requirements of the U.S. Securities and Exchange Commission and Nasdaq Marketplace Rules. As permitted by Nasdaq Marketplace Rules, we will appoint a third independent board member to the audit committee within one year of listing on Nasdaq. The Audit Committee meets at least two times per year.
Corporate Governance Requirements under Nasdaq Listing Rules.
As we are incorporated in Australia, we are allowed to follow Australian “home country” corporate governance practices in lieu of the otherwise applicable Nasdaq corporate governance standards, as long as we disclose each requirement of Rule 5600 that we do not follow and describe the home country practice we follow in lieu of the relevant Nasdaq corporate governance standards. We intend to take all actions necessary to maintain compliance with applicable corporate governance requirements under the rules adopted by the SEC and listing standards of Nasdaq. We follow Australian corporate governance practices in lieu of the corporate governance requirements of the Nasdaq Marketplace Rules in respect of:
| ● | Nasdaq requirement under Rule 5605(d) that a compensation committee be constituted — The ASX Listing Rules do not have an express requirement that each issuer listed on ASX have a compensation committee. We expect to rely on an exemption from the requirement to constitute a compensation committee under the Nasdaq listing rules and we seek to claim such exemption. |
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| ● | Nasdaq requirement under Rule 5605(e) that a nominations committee be constituted — The ASX Listing Rules do not have an express requirement that each issuer listed on ASX have a nominations committee. We expect to rely on an exemption from the requirement to constitute a nominations committee under the Nasdaq listing rules and we seek to claim such exemption. |
| ● | Nasdaq requirement under Rule 5620(c) that a quorum consist of holders of 33 1/3% of the outstanding ordinary shares — The ASX Listing Rules and the Australian Corporations Act do not have an express requirement that each issuer listed on ASX have a quorum of any particular number of the outstanding ordinary shares, but instead allow a listed issuer to establish its own quorum requirements. Our quorum is currently two persons who are entitled to vote. We believe this quorum requirement is consistent with the requirements of the ASX and is appropriate and typical of generally accepted business practices in Australia. |
| ● | Nasdaq requirements under Rules 5605(b)(1) and (2) relating to director independence, including the requirements that a majority of the board of directors must be comprised of independent directors and that independent directors must have regularly scheduled meetings at which only independent directors are present — The Nasdaq and ASX definitions of what constitute an independent director are not identical and the requirements relating to the roles and obligations of independent directors are not identical. The ASX, unlike Nasdaq, permits an issuer to establish its own materiality threshold for determining whether a transaction between a director and an issuer affects the director’s status as independent and it does not require that a majority of the issuer’s board of directors be independent, as long as the issuer publicly discloses this fact. In addition, the ASX does not require that the independent directors have regularly scheduled meetings at which only independent directors are present. We believe that our Board composition is consistent with the requirements of the ASX and that it is appropriate and typical of generally accepted business practices in Australia. |
| ● | The requirement that our independent directors meet regularly in executive sessions under Nasdaq Listing Rules. The ASX Listing Rules and the Corporations Act do not require the independent directors of an Australian company to have such executive sessions. |
| ● | The Nasdaq requirements under Rules 5605(d) that compensation of an issuer’s officers must be determined, or recommended to the Board for determination, either by a majority of the independent directors, or a compensation committee comprised solely of independent directors, and that director nominees must either be selected, or recommended for the Board’s selection, either by a majority of the independent directors, or a nominations committee comprised solely of independent directors. The Nasdaq compensation committee requirements are not identical to the ASX remuneration and nomination committee requirements. Issuers listed on the ASX are recommended under applicable listing standards to establish a remuneration committee consisting of a majority of independent directors and an independent chairperson, or publicly disclose that it has not done so. We do not have a compensation committee. |
| ● | The requirement prescribed by Nasdaq Listing Rules that issuers obtain shareholder approval prior to the issuance of securities in connection with certain acquisitions, private placements of securities, or the establishment or amendment of certain share option, purchase or other compensation plans. Applicable Australian law and the ASX Listing Rules differ from Nasdaq requirements, with the ASX Listing Rules providing generally for prior shareholder approval in numerous circumstances, including (i) issuance of equity securities exceeding 15% (or 25% under certain circumstances) of our issued share capital in any 12-month period (but, in determining the 15% limit, securities issued under an exception to the rule or with shareholder approval are not counted), (ii) issuance of equity securities to related parties (as defined in the ASX Listing Rules) and (iii) issuances of securities to directors or their associates under an employee incentive plan. |
Indemnification of Directors and Officers
Our Constitution provides that, we may indemnify a person who is, or has been, a director or an officer of our company, to the full extent permissible by law, out of our property against any liability incurred by such person as a director or an officer in defending proceedings, whether civil or criminal, and whatever their outcome.
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In addition, our Constitution provides that to the extent permitted by law, we may pay, or agree to pay, a premium in respect of a contract insuring a person who is or has been a director or an officer of our company or one of our subsidiaries against any liability:
| ● | incurred by the person in his or her capacity as a director or an officer of our company or a subsidiary of our company, and |
| ● | for costs and expenses incurred by that person in defending proceedings relating to that person acting as a director or an officer of our company or a subsidiary of our company, whether civil or criminal, and whatever their outcome. |
We maintain a directors’ and officers’ liability insurance policy. We have established a policy for the indemnification of our directors and officers against certain liabilities incurred as a director or officer, including costs and expenses associated in successfully defending legal proceedings.
Share Ownership
Ownership of Senior Management and Directors
The following table sets forth certain information as of June 30, 2026 regarding the ownership of our ordinary shares by each of our directors and senior management and by all of our directors and senior management as a group. The percentages shown are based on 98,006,092 ordinary shares issued and outstanding as of June 30, 2026.
| Name | Number of Ordinary Shares Owned | Percentage of Ownership | ||||||
| Cadell Buss | 2,347,190 | 2.39 | % | |||||
| Alexander Shaw | 317,965 | 0.32 | % | |||||
| Manuel Mota | 895,279 | 0.91 | % | |||||
| Mark Laybourn | - | - | % | |||||
| José Martins | 300,000 | 0.31 | % | |||||
| All directors and executive officers as a group (5 persons) – | 3,860,434 | 3.94 | % | |||||
Code of Conduct
We have adopted a Code of Conduct applicable to all our directors, officers and employees. Our Code of Conduct is available on our website at www.chilwaminerals.com.au. We post on our website all disclosures that are required by law, ASX Listing Rules or the listing standards of Nasdaq concerning any amendments to, or waivers from, any provision of the Code of Conduct. The reference to our website address does not constitute incorporation by reference of the information contained at or available through our website, and you should not consider it to be a part of, this prospectus.
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The following table presents the beneficial ownership of our ordinary shares based on 98,006,092 ordinary shares outstanding at June 30, 2026 by each person known by us to be the beneficial owner of more than 5% of our ordinary shares.
We have determined beneficial ownership in accordance with the rules and regulations of the SEC, and the information is not necessarily indicative of beneficial ownership for any other purpose. Except as indicated by the footnotes below, we believe, based on information furnished to us, that the persons and entities named in the table below have sole voting and sole investment power with respect to all shares that they beneficially own.
Applicable percentage ownership before the offering is based on 98,006,092 ordinary shares outstanding as of June 30, 2026. Applicable percentage ownership after the offering is based on ordinary shares outstanding immediately after the closing of this offering (after giving effect to the sale and issuance of ADSs representing 7,270,000 ordinary shares at an ADS-to-ordinary share ratio of 1-to-10), assuming no exercise by the underwriter of its option to purchase additional ADSs. In computing the number of shares beneficially owned by a person or entity and the percentage ownership of such person or entity, we deemed to be outstanding all shares subject to options and warrants held by the person or entity that are currently exercisable, or exercisable within 60 days of June 30, 2026. However, except as described above, we did not deem such shares outstanding for the purpose of computing the percentage ownership of any other person or entity.
| Ordinary
Shares Beneficially Owned prior to the Offering |
Ordinary
Shares Beneficially Owned after the Offering |
|||||||||||||||
| Shareholder | Number | Percentage | Number | Percentage | ||||||||||||
| Luso Global Mining BV | 30,555,432 | 31.2 | % | 30,555,432 | 29.0 | % | ||||||||||
| Dreamers Holdings Pty Ltd | 5,686,600 | 5.8 | % | 5,686,600 | 5.4 | % | ||||||||||
As of June 30, 2026, there were 606 holders of record of our ordinary shares, of which none had registered addresses in the United States. These numbers are not representative of the number of beneficial holders of our shares nor are they representative of where such beneficial holders reside, as many of these ordinary shares were held of record by brokers or other nominees.
To our knowledge, we are not directly or indirectly controlled by another corporation, by any foreign government or by any other natural or legal person severally or jointly. There are no agreements known to us, the operation of which may at a subsequent date result in a change in control of Chilwa.
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Certain Relationships and Related Party Transactions
The following is a description of our related party transactions since July 1, 2023.
Mota-Engil Group (“Mota”), which holds a 100% interest in Luso Global Mining (“Luso”), is a major ultimate shareholder of Chilwa Minerals Limited. Both companies provide technical and drilling services in Malawi in relation to the Project. For the financial years 2026, 2025 and 2024, the total value of the services provided by the companies was A$3,384,822, A$2,888,004 and A$2,405,321, respectively. The expenditure was recognized as an exploration and evaluation asset of the Project. As of June 30, 2026, June 30, 2025 and June 30, 2024, respectively, A$1,336,430 (comprising trade payables of A$369,001 and accrued drilling and services of A$967,429), A$1,859,338 and A$1,730,266 were owed by Chilwa to Mota.
In addition, on July 1, 2023, 18,750,000 performance rights were issued to Luso as part of the consideration for the acquisition of Chilwa Minerals Africa Limited. The share-based payment expense of A$3,750,000 was recognized in fiscal year 2024, and capitalized to the exploration and evaluation asset of the Project.
In fiscal year 2024, Mota-Engil Engenharia e Construção África, S.A., an entity within the Mota-Engil group of companies, provided Chilwa Minerals Africa Limited an unsecured loan of MWK 50 million (A$43,304 using an exchange rate at June 30, 2024) for working capital purposes. The loan is interest-free and repayable upon demand.
In fiscal years 2025 and 2024, respectively, Chilwa paid A$40,000 and A$28,000 in fees to DWCorporate Pty Ltd (“DWCorporate”) as consideration for the services of Dennis Wilkins as a director of Chilwa. Mr. Wilkins is the founder and principal of DWCorporate. In addition to the remuneration paid to DWCorporate for the provision of Mr. Wilkins’ services as director, a total of A$429,373 and A$180,264 was paid to DWCorporate in fiscal years 2025 and 2024, respectively, for company secretarial and accounting services. The amounts paid were at usual commercial rates with fees charged on an hourly basis. As of June 30, 2025 and June 30, 2024, respectively, there was A$27,810 and A$19,506 owed to DWCorporate.
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General
As of June 30, 2026, we had 98,006,092 ordinary shares outstanding that were held by approximately 600 shareholders on record, unquoted options to purchase 877,873 ordinary shares at a weighted-average exercise price of A$0.35 per share, class B performance rights for 5,000,000 ordinary shares issued, class C performance rights for 5,000,000 ordinary shares issued, class D performance rights for 5,000,000 ordinary shares issued and class E performance rights for 3,250,000 ordinary shares and class F performance rights for 7,000,000 ordinary shares.
Memorandum and Articles of Association
General
Our constituent document is a Constitution. The Constitution is subject to the terms of the ASX Listing Rules and the Australian Corporations Act. The Constitution may be amended or repealed and replaced by special resolution of shareholders, which is a resolution of which notice has been given and that has been passed by at least 75% of the votes cast by shareholders entitled to vote on the resolution.
Purposes and Objects
As an Australian public company, we have all the rights, powers and privileges of a natural person. Our Constitution does not provide for or prescribe any specific objects or purposes.
The Powers of the Directors
Under the provision of our Constitution our directors may exercise all the powers of our company except any powers that the Corporations Act or the constitution attributes to Chilwa.
Interested Directors
According to our constitution, if a Director discloses his or her in accordance with the Corporations Act, the director may (i) contract or make an arrangement with the Company, or a related body corporate of the Company or a body corporate in which the Company is interested, in any matter in any capacity, (ii) be counted in a quorum for a meeting of Directors considering the contract or arrangement, (iii) vote on whether the Company enters into the contract or arrangement, and on any matter that relates to the contract or arrangement, (iv) sign on behalf of the Company, or witness the affixing of the common seal of the Company to, any document in respect of the contract or arrangement, (v) retain the benefits under the contract or arrangement.
Unless a relevant exception applies, the Corporations Act requires our directors to provide disclosure of certain interests or conflicts of interests and prohibits directors from voting on matters in which they have a material personal interest and from being present at the meeting while the matter is being considered. In addition, the Corporations Act and the ASX Listing Rules require shareholder approval of any provision of related party benefits to our directors.
Directors’ compensation
Our non-executive directors are paid remuneration for their services as directors which is determined, in aggregate, in a general meeting of shareholders. The aggregate, fixed sum for directors’ remuneration is to be divided among the directors in such proportion as the directors themselves agree and in accordance with our Constitution. Our executive directors are paid remuneration for their services as directors which is determined by all directors.
Fees payable to our non-executive directors must be by way of a fixed sum and not by way of a commission on or a percentage of profits or operating revenue. Remuneration paid to our executive directors must also not include a commission or percentage of operating revenue.
Pursuant to our Constitution, any director who performs services that in the opinion of our board of directors, are outside the scope of the ordinary duties of a director may be paid extra remuneration, which is determined by our board of directors.
In addition to other remuneration provided in our Constitution, all our directors are entitled to be paid by us for reasonable travel accommodation and other expenses incurred by the directors in attending general meetings, board meetings, committee meetings or otherwise in connection with our business.
In addition, in accordance with our Constitution, a director may be paid a retirement benefit as determined by our board of directors subject to the limits set out in the Corporations Act and the ASX Listing Rules which broadly restrict our ability to pay our officers a termination benefit in the event of a change of control of the Company or our subsidiaries as well as impose requirements for shareholder approval to be obtained to pay certain retirement benefits to our officers.
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Borrowing powers exercisable by Directors
Pursuant to our Constitution, the management and control of our business affairs are vested in our board of directors. Thus, our board of directors has the power to raise or borrow money, and charge any of our property or business or any uncalled capital, and may issue debentures or give any other security for any of our debts, liabilities or obligations or of any other person, in each case, in the manner and on terms it deems fit.
Retirement of Directors
Pursuant to our Constitution and the ASX Listing Rules, each director, other than the managing director, must not hold office for more than three years or beyond the third annual general meeting following his or her appointment (whichever is longer). Further, at least one director is required to retire by rotation at each annual general meeting (such director being the director who has been longest in office since their last election). Directors who retire by rotation are eligible for a re-election to the board of directors unless disqualified from acting as a director under the Corporations Act or our Constitution.
Rights Attached to Our Ordinary Shares
The concept of authorized share capital does not exist in Australia and as a result, our authorized share capital is unlimited. All our outstanding ordinary shares are validly issued, fully paid and non-assessable. The rights attached to our ordinary shares are as follows:
Dividend Rights.
The directors may declare that a dividend be paid to the members according to the shareholders’ pro rata shareholdings and the directors may fix the amount, the time for payment and the method of payment. No dividend is payable except in accordance with the Corporations Act as amended from time to time and no dividend carries interest as against the Company.
Voting Rights.
Holders of ordinary shares have one vote for each ordinary share held on all matters submitted to a vote of shareholders. Such voting rights may be affected by the grant of any special voting rights to the holders of a class of shares with preferential rights that may be authorized in the future.
The quorum required for an ordinary meeting of shareholders consists of at least two shareholders present in person, or by proxy, attorney or representative appointed pursuant to our Constitution. A meeting adjourned for lack of a quorum generally is adjourned to the same day in the following week at the same time and place. At the reconvened meeting, the required quorum consists of any two members present in person, or by proxy, attorney or representative appointed pursuant to our Constitution. The meeting is dissolved if a quorum is not present within 30 minutes from the time appointed for the meeting.
An ordinary resolution, such as a resolution for the declaration of dividends, requires approval by the holders of a majority of the voting rights represented at the meeting, in person, by proxy, or by written ballot and voting thereon. Under our Constitution, the Corporations Act and the ASX Listing Rules, certain matters must be passed by way of a special resolution. A special resolution must be passed by at least 75% of the votes cast by shareholders entitled to vote on the resolution and who vote at the meeting in person or by proxy. Matters which are not required to be passed by special resolution are required to be passed by ordinary resolution.
Rights in Our Profits.
Our shareholders have the right to share in our profits distributed as a dividend and any other permitted distribution.
Rights in the Event of Liquidation.
In the event of our liquidation, after satisfaction of liabilities to creditors, our assets will be distributed to the holders of ordinary shares in proportion to the capital at the commencement of the liquidation paid up or which ought to have been paid up on the shares held by them respectively. This right may be affected by the grant of preferential dividend or distribution rights to the holders of a class of shares with preferential rights, such as the right in winding up to payment in cash of the amount then paid up on the share, and any arrears of dividend in respect of that share, in priority to any other class of shares.
Changing Rights Attached to Shares
According to our Constitution, the rights attached to any class of shares, unless otherwise provided by the terms of the class, may be varied with either the written consent of the holders of not less than 75% of the issued shares of that class or the sanction of a special resolution passed at a separate general meeting of the shares of that class.
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Exchange Controls
Australia has largely abolished exchange controls on investment transactions. The Australian dollar is freely convertible into U.S. dollars. In addition, there are currently no specific rules or limitations regarding the export from Australia of profits, dividends, capital or similar funds belonging to foreign investors, except that certain payments to non-residents must be reported to the Australian Cash Transaction Reports Agency, which monitors such transaction, and amounts on account of potential Australian tax liabilities may be required to be withheld unless a relevant taxation treaty can be shown to apply.
The Foreign Acquisitions and Takeovers Act 1975
Under Australian law, in certain circumstances foreign persons are prohibited from acquiring more than a limited percentage of the shares in an Australian company without approval from the Australian Treasurer. These limitations are set forth in the Australian Foreign Acquisitions and Takeovers Act 1975 (Cth) (“FATA”), associated legislation and regulations. These limitations are in addition to the more general overarching Takeovers Prohibition of an acquisition of more than a 20% interest in a public company (in the absence of an applicable exception) under the takeover provisions of Australia’s Corporations Act by any person whether foreign or otherwise.
If an investment is subject to foreign investment approval, it may have compulsory prior notification requirements, being a “notifiable action” or “notifiable national security action” or voluntary prior notification requirements being a “significant action” or “reviewable national security action”. If an investment falls in this voluntary application category, the seeking of approval will extinguish certain future rights the Australian Treasurer has to review and approve the investment. Not applying for approval where the voluntary notification provisions apply will not be a breach of the FATA.
The Australian foreign investment regime applies differently to ‘foreign government investors’ and private foreign persons. Broadly, entities are considered as foreign persons if (i) a foreign holder (together with its associates) holds a direct or indirect interest of 20% or more in the entity or (ii) multiple foreign holders hold an aggregate interest (direct or indirect) of at least 40%. An entity will be a ‘foreign government investor’ if (i) a foreign government or foreign government owned entity, or a number of foreign government owned entities from the same country own a direct or indirect interest of 20% or (ii) or multiple foreign governments or foreign government owned entities from any country own a direct or indirect interest of 40% is held by foreign government investors from multiple countries.
Under the FATA, foreign persons are required to notify and obtain prior approval from the Foreign Investment Review Board for a range of acquisitions of an interest in an Australian entity on a mandatory basis, including:
| ● | acquisitions of a direct interest (generally 10% or more) by a foreign government investor in an Australian entity, irrespective of value; |
| ● | acquisitions by any foreign person of: |
| - | a ‘substantial interest’ (generally 20% or more) in an Australian entity valued above the relevant monetary threshold. This is generally A$281 million (indexed annually) or A$1,498 million in case of U.S. investors, in each case calculated by the higher of the total asset value and the total value of the issued securities of the Australian entity; or |
| - | a direct interest in a ‘national security business’ or entity that carries on a national security business, or holds ‘national security land’, irrespective of value; and |
| ● | acquisitions of interests in Australian entities operating in sensitive industries (such as media, telecommunications, and encryption and security technologies), land-rich Australian entities or agribusiness Australian entities. |
Each foreign person seeking to acquire holdings in excess of the above caps (including their associates) would need to complete an application form setting out the proposal and relevant particulars of the acquisition/shareholding and pay the relevant application fees. The Australian Treasurer then has 30 days to consider the application and make a decision and a further 10 days to notify the applicant. However, the Australian Treasurer has broad powers to extend this time period, including extending the period by up to a further 90 days by publishing an interim order. Most commonly, the Australian Treasurer will request that an applicant agree to an extension to avoid needing to publish the interim order, such agreement is usually in the best interest of the applicant as interim orders are made public and by agreeing to an extension the application process is kept confidential. Otherwise applications are strictly confidential and not released to the public.
The Australian Foreign Investment Review Board, an Australian advisory board to the Australian Treasurer, has provided a guideline titled Australia’s Foreign Investment Policy, which provides an outline of the policy. As for the risk associated with seeking approval, the policy provides, among other things, that the Treasurer will reject an application if it is contrary to the national interest.
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If an application is made to the Australian Treasurer (whether voluntary or compulsory), the Australian Treasurer may either issue a non-objection notice, a non-objection notice with conditions or a rejection notice.
If the necessary approvals are not obtained, the Treasurer has a range of enforcement powers, including the power to make an order requiring the acquirer to dispose of the shares it has acquired within a specified period of time. Once a foreign person (together with any associate) holds a direct interest or a substantial interest in an entity, any further acquisition of interests, including in the course of trading in the secondary market, would require a new FIRB approval unless an exemption applies.
Once granted, a FIRB approval is valid for a 12-month period, meaning the proposed acquisition which was the subject of an application can occur any time during that 12-month period.
Annual and Extraordinary Meetings
Our directors must convene an annual meeting of shareholders at least once every calendar year. Notice of at least 28 days prior to the date of the meeting is required. A general meeting may be convened by any director, or shareholders in compliance with the Corporations Act.
Limitations on the Rights to Own Securities in Our Company
Subject to certain limitations on the percentage of shares a person may hold in our company, neither our Constitution nor the laws of the Commonwealth of Australia restrict in any way the ownership or voting of shares in our company.
Changes in Our Capital
Pursuant to the ASX Listing Rule 7.1, our directors may in their discretion issue securities to persons who are not related parties of our company, without the approval of shareholders, if such issue, when aggregated with securities issued by our company during the previous 12-month period would be an amount that would not exceed 15% of our issued capital at the commencement of the 12 month period. There is no restriction on the issue price under this ASX rule.
In addition, ASX Listing Rule 7.1A allows “eligible entities” (small to mid-cap companies) to have an additional 10% placement capacity over a 12-month period. It requires a specific approval by shareholders at every year’s annual shareholders meeting. This element of placement capacity has an issue price limit, being a maximum 25% discount to market price.
If issuances of shares in a private placement exceed the 15% or 25% placement capacity (as applicable), then shareholder approval is required with respect to any issuance of shares that exceeds such placement capacity at a special shareholders meeting. Such shareholder approval is valid for 3 months from the date of approval.
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Description of AMERICAN DEPOSITARY SHARES
The Bank of New York Mellon, as depositary, will register and deliver American Depositary Shares, also referred to as ADSs. Each ADS will represent 10 shares (or a right to receive 10 shares) deposited with The HSBC Bank Australia Limited, as custodian for the depositary. Each ADS will also represent any other securities, cash or other property that may be held by the depositary. The deposited shares together with any other securities, cash or other property held by the depositary are referred to as the deposited securities. The depositary’s office at which the ADSs will be administered and its principal executive office are located at 240 Greenwich Street, New York, New York 10286.
You may hold ADSs either (A) directly (i) by having an American Depositary Receipt, also referred to as an ADR, which is a certificate evidencing a specific number of ADSs, registered in your name, or (ii) by having uncertificated ADSs registered in your name, or (B) indirectly by holding a security entitlement in ADSs through your broker or other financial institution that is a direct or indirect participant in The Depository Trust Company, also called DTC. If you hold ADSs directly, you are a registered ADS holder, also referred to as an ADS holder. This description assumes you are an ADS holder. If you hold the ADSs indirectly, you must rely on the procedures of your broker or other financial institution to assert the rights of ADS holders described in this section. You should consult with your broker or financial institution to find out what those procedures are.
Registered holders of uncertificated ADSs will receive statements from the depositary confirming their holdings.
As an ADS holder, we will not treat you as one of our shareholders and you will not have shareholder rights. Australian law governs shareholder rights. The depositary will be the holder of the shares underlying your ADSs. As a registered holder of ADSs, you will have ADS holder rights. A deposit agreement among us, the depositary, ADS holders and all other persons indirectly or beneficially holding ADSs sets out ADS holder rights as well as the rights and obligations of the depositary. New York law governs the deposit agreement and the ADSs.
The following is a summary of the material provisions of the deposit agreement. For more complete information, you should read the entire deposit agreement and the form of ADR. You may obtain these documents from the Company and the SEC’s Electronic Data Gathering, Analysis and Retrieval system, which may be accessed through the SEC’s website at www.sec.gov.
Dividends and Other Distributions
How will you receive dividends and other distributions on the shares?
The depositary has agreed to pay or distribute to ADS holders the cash dividends or other distributions it or the custodian receives on shares or other deposited securities, upon payment or deduction of its fees and expenses. You will receive these distributions in proportion to the number of shares your ADSs represent.
| ● | Cash. The depositary will convert any cash dividend or other cash distribution we pay on the shares into U.S. dollars, if it can do so on a reasonable basis and can transfer the U.S. dollars to the United States. If that is not possible or if any government approval is needed and cannot be obtained, the deposit agreement allows the depositary to distribute the foreign currency only to those ADS holders to whom it is possible to do so. It will hold the foreign currency it cannot convert for the account of the ADS holders who have not been paid. It will not invest the foreign currency and it will not be liable for any interest. |
Before making a distribution, any withholding taxes, or other governmental charges that must be paid will be deducted. See “Item 10. Additional Information—E. Taxation.” The depositary will distribute only whole U.S. dollars and cents and will round fractional cents to the nearest whole cent. If the exchange rates fluctuate during a time when the depositary cannot convert the foreign currency, you may lose some of the value of the distribution.
| ● | Shares. The depositary may distribute additional ADSs representing any shares we distribute as a dividend or free distribution. The depositary will only distribute whole ADSs. It will sell shares which would require it to deliver a fraction of an ADS (or ADSs representing those shares) and distribute the net proceeds in the same way as it does with cash. If the depositary does not distribute additional ADSs, the outstanding ADSs will also represent the new shares. The depositary may sell a portion of the distributed shares (or ADSs representing those shares) sufficient to pay its fees and expenses in connection with that distribution. |
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| ● | Rights to purchase additional shares. If we offer holders of our securities any rights to subscribe for additional shares or any other rights, the depositary may (i) exercise those rights on behalf of all or certain ADS holders, (ii) distribute those rights to certain ADS holders or (iii) sell those rights and distribute the net proceeds to ADS holders entitled to those proceeds, in each case after deduction or upon payment of its fees and expenses. To the extent the depositary does not do any of those things, it will allow the rights to lapse. In that case, you will receive no value for them. The depositary will exercise or distribute rights only if we ask it to and provide satisfactory assurances to the depositary that it is legal to do so. If the depositary will exercise rights, it will purchase the securities to which the rights relate and distribute those securities or, in the case of shares, new ADSs representing the new shares, to subscribing ADS holders, but only if ADS holders have paid the exercise price to the depositary. U.S. securities laws may restrict the ability of the depositary to distribute rights or ADSs or other securities issued on exercise of rights to all or certain ADS holders, and the securities distributed may be subject to restrictions on transfer. | |
| Other Distributions. The depositary will send to ADS holders anything else we distribute on deposited securities by any means it thinks is legal, fair and practical. If it cannot make the distribution in that way, the depositary has a choice. It may decide to sell what we distributed and distribute the net proceeds, in the same way as it does with cash. Alternatively, it could decide to withhold distribution of securities if it has not received reasonably satisfactory assurances from us that the distribution does not require registration under the Securities Act. The depositary may sell a portion of the distributed securities or property sufficient to pay its fees and expenses in connection with that distribution. | ||
| If a distribution would represent a return of all or substantially all the value of the deposited securities underlying ADSs, the depositary may: (i) require payment of or deduct the fee for surrender of ADSs (whether or not it is also requiring surrender of ADSs) as a condition of making that distribution; or (ii) sell all deposited securities other than the subject distribution and add any net cash proceeds of that sale to the distribution, call for surrender of all those ADSs and require that surrender as a condition of making that distribution. U.S. securities laws may restrict the ability of the depositary to distribute securities to all or certain ADS holders, and the securities distributed may be subject to restrictions on transfer. |
The depositary is not responsible if it decides that it is unlawful or impractical to make a distribution available to any ADS holders. We have no obligation to register ADSs, shares, rights or other securities under the Securities Act. We also have no obligation to take any other action to permit the distribution of ADSs, shares, rights or anything else to ADS holders. This means that you may not receive the distributions we make on our shares or any value for them if it is illegal or impractical for us to make them available to you.
Deposit, Withdrawal and Cancellation
How are ADSs issued?
The depositary will deliver ADSs if you or your broker deposits shares or evidence of rights to receive shares with the custodian. Upon payment of its fees and expenses and of any taxes or charges, such as taxes and other governmental charges or stock transfer taxes or fees, the depositary will register the appropriate number of ADSs in the names you request and will deliver the ADSs to or upon the order of the person or persons that made the deposit.
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How can ADS holders withdraw the deposited securities?
You may surrender your ADSs to the depositary for the purpose of withdrawal. Upon payment of its fees and expenses and of any taxes or charges, such as taxes and other governmental charges or stock transfer taxes or fees, the depositary will direct the custodian to deliver the shares and any other deposited securities underlying the ADSs to the ADS holder or a person the ADS holder designates at the office of the custodian. The depositary may charge the surrendering owner a fee and its expenses for giving that direction by cable (including SWIFT) or facsimile transmission. Or, at your request, risk and expense, the depositary will deliver the deposited securities at its office or another address specified in the order received, if feasible. However, the depositary is not required to accept surrender of ADSs to the extent it would require delivery of a fraction of a deposited share or other security. The depositary may charge you a fee and its expenses for instructing the custodian regarding delivery of deposited securities.
When can ADSs be cancelled by the depositary?
The depositary may cancel ADSs if there are no underlying deposited securities, or those deposited securities have become apparently worthless or to the extent there are insufficient underlying deposited securities because of an increase in the number of shares represented by one ADS.
How do ADS holders interchange between certificated ADSs and uncertificated ADSs?
You may surrender your ADR to the depositary for the purpose of exchanging your certificated ADSs for uncertificated ADSs. The depositary will cancel the receipt evidencing those certificated ADSs and will send to the ADS holder a statement confirming that the ADS holder is the registered holder of uncertificated ADSs. Upon receipt by the depositary of a proper instruction from a registered holder of uncertificated ADSs requesting the exchange of uncertificated ADSs for certificated ADSs, the depositary will cancel those uncertificated ADSs and register and deliver to the ADS holder a receipt evidencing the same number of certificated ADSs.
Voting Rights
How do you vote?
ADS holders may instruct the depositary how to vote the number of deposited shares their ADSs represent. If we request the depositary in writing to solicit your voting instructions (and we are not required to do so), the depositary will notify you of a shareholders’ meeting and send or make voting materials available to you. Those materials will describe the matters to be voted on and explain how ADS holders may instruct the depositary how to vote. For instructions to be valid, they must reach the depositary in a manner and by a date set by the depositary. The depositary will try, as far as practical, subject to the laws of Australia and the provisions of our constitution, to vote or to have its agents vote the shares or other deposited securities as instructed by ADS holders. Except by instructing the depositary as described above, you won’t be able to exercise voting rights unless you surrender your ADSs and withdraw the shares. However, you may not know about the meeting enough in advance to withdraw the shares. In any event, the depositary will not exercise any discretion in voting deposited securities and it will only vote or attempt to vote as instructed.
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We cannot assure you that you will receive the voting materials in time to ensure that you can instruct the depositary to vote the shares represented by your ADSs. In addition, the depositary and its agents are not responsible for failing to carry out voting instructions or for the manner of carrying out voting instructions. This means that you may not be able to exercise voting rights and there may be nothing you can do if the shares represented by your ADSs are not voted as you requested.
In order to give you a reasonable opportunity to instruct the depositary as to the exercise of voting rights relating to Deposited Securities, if we request the depositary to act, we agree to give the depositary notice of any such meeting and details concerning the matters to be voted upon at least 35 days in advance of the meeting date.
Fees and Expenses
| Holders or persons depositing or withdrawing ordinary shares, surrendering ADSs, or to who or from whom ADSs are delivered or cancelled must pay: | For: | |
| US$10.00 (or less) per 100 ADSs (or portion of 100 ADSs) | Issuance of ADSs, including issuances resulting from a distribution of shares or rights or other property or in relation to a change in the number of shares represented by ADSs | |
| Surrender of ADSs for the purpose of withdrawal or cancellation of ADSs, including if the deposit agreement terminates or in relation to a change in the number of shares represented by ADSs | ||
| US$0.10 (or less) per ADS (or portion thereof) | Any cash distribution to ADS holders | |
| A fee equivalent to the fee that would be payable if securities distributed to you had been shares and the shares had been deposited for issuance of ADSs | Distribution of securities distributed to holders of deposited securities (including rights) that are distributed by the depositary to ADS holders | |
Fees assessed from time to time, but not exceeding US$0.10 per ADS during any calendar year |
Depositary services | |
| Registration or transfer fees | Transfer and registration of shares on our share register to or from the name of the depositary or its agent when you deposit or withdraw shares | |
| Expenses of the depositary | Cable (including SWIFT) and facsimile transmissions (when expressly provided in the deposit agreement) | |
| Converting foreign currency to U.S. dollars | ||
| Taxes and other governmental charges the depositary or the custodian has to pay on any ADSs or shares underlying ADSs, such as stock transfer taxes, stamp duty or withholding taxes | As necessary | |
| Any charges incurred by the depositary or its agents for servicing the deposited securities | As necessary |
The depositary collects its fees for delivery and surrender of ADSs directly from investors depositing shares or surrendering ADSs for the purpose of withdrawal or from intermediaries acting for them. The depositary collects fees for making distributions to investors by deducting those fees from the amounts distributed or by selling a portion of distributable property to pay the fees. The depositary may collect fees for depositary services by deduction from cash distributions or by directly billing investors or by charging the book-entry system accounts of participants acting for them. While aggregate fees for depositary services will not exceed US$0.10 per ADS in a calendar year, an investor may be charged more than one such fee in a consecutive 12-month period. The depositary may collect any of its fees by deduction from any cash distribution payable (or by selling a portion of securities or other property distributable) to ADS holders that are obligated to pay those fees. The depositary may generally refuse to provide fee attracting services until its fees for those services are paid. The depositary may own and deal in any class of our securities and our affiliates and in ADSs.
From time to time, the depositary may make payments to us to reimburse us for costs and expenses generally arising out of establishment and maintenance of the ADS program, waive fees and expenses for services provided to us by the depositary or share revenue from the fees collected from ADS holders. In performing its duties under the deposit agreement, the depositary may use brokers, dealers, foreign currency dealers or other service providers that are owned by or affiliated with the depositary and that may earn or share fees, spreads or commissions.
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The depositary may convert currency itself or through any of its affiliates, or the custodian or we may convert currency and pay U.S. dollars to the depositary. Where the depositary converts currency itself or through any of its affiliates, the depositary acts as principal for its own account and not as agent, advisor, broker or fiduciary on behalf of any other person and earns revenue, including, without limitation, transaction spreads, that it will retain for its own account. The revenue is based on, among other things, the difference between the exchange rate assigned to the currency conversion made under the deposit agreement and the rate that the depositary or its affiliate receives when buying or selling foreign currency for its own account. The depositary makes no representation that the exchange rate used or obtained by it or its affiliate in any currency conversion under the deposit agreement will be the most favorable rate that could be obtained at the time or that the method by which that rate will be determined will be the most favorable to ADS holders, subject to the depositary’s obligation to act without negligence or bad faith. The methodology used to determine exchange rates used in currency conversions made by the depositary is available upon request. Where the custodian converts currency, the custodian has no obligation to obtain the most favorable rate that could be obtained at the time or to ensure that the method by which that rate will be determined will be the most favorable to ADS holders, and the depositary makes no representation that the rate is the most favorable rate and will not be liable for any direct or indirect losses associated with the rate. In certain instances, the depositary may receive dividends or other distributions from us in U.S. dollars that represent the proceeds of a conversion of foreign currency or translation from foreign currency at a rate that was obtained or determined by us and, in such cases, the depositary will not engage in, or be responsible for, any foreign currency transactions and neither it nor we make any representation that the rate obtained or determined by us is the most favorable rate and neither it nor we will be liable for any direct or indirect losses associated with the rate.
Payment of Taxes
You will be responsible for any taxes or other governmental charges payable on your ADSs or on the deposited securities represented by any of your ADSs. The depositary may refuse to register any transfer of your ADSs or allow you to withdraw the deposited securities represented by your ADSs until those taxes or other charges are paid. It may apply payments owed to you or sell deposited securities represented by your ADSs to pay any taxes owed and you will remain liable for any deficiency. If the depositary sells deposited securities, it will, if appropriate, reduce the number of ADSs to reflect the sale and pay to ADS holders any proceeds, or send to ADS holders any property, remaining after it has paid the taxes.
Tender and Exchange Offers; Redemption, Replacement or Cancellation of Deposited Securities
The depositary will not tender deposited securities in any voluntary tender, exchange offer or similar offer unless instructed to do so by an ADS holder surrendering ADSs and subject to any conditions or procedures the depositary may establish.
If deposited securities are redeemed for cash in a transaction that is mandatory for the depositary as a holder of deposited securities, the depositary will call for surrender of a corresponding number of ADSs and distribute the net redemption money to the holders of called ADSs upon surrender of those ADSs.
If there is any change in the deposited securities such as a sub-division, combination or other reclassification, or any merger, consolidation, sale of assets substantially as an entirety, recapitalization or reorganization affecting the issuer of deposited securities in which the depositary receives new securities in exchange for or in lieu of the old deposited securities, the depositary will, if required, surrender the old deposited securities affected and hold those replacement securities as deposited securities under the deposit agreement. However, if the depositary decides it would not be lawful and practical to hold the replacement securities because those securities could not be distributed to ADS holders without registration under the Securities Act or for any other reason, the depositary may instead sell the replacement securities and distribute the net proceeds upon surrender of the ADSs. If there is a replacement of the deposited securities and the depositary will continue to hold the replacement securities, the depositary may distribute new ADSs representing the new deposited securities or ask you to surrender your outstanding ADSs in exchange for new ADSs identifying the new deposited securities. If the number of shares represented by each ADS decreases as a result of a replacement, the depositary may call for surrender of the ADSs to be exchanged on a mandatory basis for a lesser number of ADSs and may sell ADSs to the extent necessary to avoid distributing fractions of ADSs in that exchange and distribute the net proceeds of that sale to the ADS holders entitled to them.
If there are no deposited securities underlying ADSs, including if the deposited securities are cancelled, or if the deposited securities underlying ADSs have become apparently worthless, the depositary may call for surrender of those ADSs or cancel those ADSs upon notice to the ADS holders.
Amendment and Termination
How may the deposit agreement be amended?
We may agree with the depositary to amend the deposit agreement and the ADRs without your consent for any reason. If an amendment adds or increases fees or charges, except for taxes and other governmental charges or expenses of the depositary for registration fees, facsimile costs, delivery charges or similar items, or prejudices a substantial right of ADS holders, it will not become effective for outstanding ADSs until 30 days after the depositary notifies ADS holders of the amendment. At the time an amendment becomes effective, you are considered, by continuing to hold your ADSs, to agree to the amendment and to be bound by the ADRs and the deposit agreement as amended. Upon the effectiveness of an amendment to the form of receipt, including a change in the number of shares represented by each ADS, the depositary may call for surrender of receipts to be replaced with new receipts in the amended form or call for surrender of ADSs to effect that change of ratio. In no event shall any amendment impair the right of the ADS holder to surrender ADSs and receive delivery of the deposited securities represented thereby, except in order to comply with mandatory provisions of applicable law.
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How may the deposit agreement be terminated?
The depositary will initiate termination of the deposit agreement if we instruct it to do so. The depositary may initiate termination of the deposit agreement if:
| ● | 60 days have passed since the depositary told us it wants to resign but a successor depositary has not been appointed and accepted its appointment; | |
| ● | we delist the ADSs from an exchange in the United States on which they were listed and do not list the ADSs on another exchange in the United States or make arrangements for trading of ADSs on the U.S. over-the-counter market; | |
| ● | we delist our shares from an exchange outside the United States on which they were listed and do not list the shares on another exchange outside the United States; | |
| ● | the depositary has reason to believe the ADSs have become, or will become, ineligible for registration on Form F-6 under the Securities Act; | |
| ● | we appear to be insolvent or enter insolvency proceedings; | |
| ● | all or substantially all the value of the deposited securities has been distributed either in cash or in the form of securities; | |
| ● | there are no deposited securities underlying the ADSs or the underlying deposited securities have become apparently worthless; or | |
| ● | there has been a replacement of deposited securities. |
If the deposit agreement is terminated, then the depositary will notify ADS holders at least 90 days before the termination date. At any time after the termination date, the depositary may sell the deposited securities. After that, the depositary will hold the money it received on the sale, as well as any other cash it is holding under the deposit agreement, unsegregated and without liability for interest, for the pro rata benefit of the ADS holders that have not surrendered their ADSs, and those ADS holders will be general creditors of the depositary with respect to those net proceeds and that other cash. Normally, the depositary will sell as soon as practicable after the termination date.
After the termination date, the depositary shall continue to receive dividends and other distributions pertaining to deposited securities (that have not been sold), may sell rights and other property and shall deliver deposited securities (or sale proceeds) upon surrender of ADSs (after payment or upon deduction, in each case, of the fee of the depositary for the surrender of ADSs, any expenses for the account of the ADS holder in accordance with the deposit agreement and any applicable taxes or governmental charges). After the termination date, the depositary shall not accept deposits of shares or deliver ADSs. After the termination date, ADS holders can still surrender their ADSs and receive delivery of deposited securities, except that the depositary may refuse to accept a surrender for the purpose of withdrawing deposited securities or reverse previously accepted surrenders of that kind that have not settled if it would interfere with the selling process. The depositary may refuse to accept a surrender for the purpose of withdrawing sale proceeds until all the deposited securities have been sold. The depositary will not be required to deliver cash proceeds of the sale of deposited securities until all deposited securities have been sold. The depositary will continue to collect distributions on deposited securities, but, after the termination date, the depositary is not required to register any transfer of ADSs or distribute any dividends or other distributions on deposited securities to the ADSs holder (until they surrender their ADSs) or give any notices or perform any other duties under the deposit agreement except as described in this paragraph.
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Limitations on Obligations and Liability
Limits on our Obligations and the Obligations of the Depositary; Limits on Liability to Holders of ADSs
The deposit agreement expressly limits our obligations and the obligations of the depositary. It also limits our liability and the liability of the depositary. We and the depositary:
| ● | are only obligated to take the actions specifically set forth in the deposit agreement without negligence or bad faith, and the depositary will not be a fiduciary or have any fiduciary duty to holders of ADSs; | |
| ● | are not liable if we are or it is prevented or delayed by law or by events or circumstances beyond our or its ability to prevent or counteract with reasonable care or effort from performing our or its obligations under the deposit agreement; | |
| ● | are not liable if we or it exercises discretion permitted under the deposit agreement; | |
| ● | are not liable for the inability of any holder of ADSs to benefit from any distribution on deposited securities that is not made available to holders of ADSs under the terms of the deposit agreement, or for any special, consequential or punitive damages for any breach of the terms of the deposit agreement; | |
| ● | are not liable for any acts or omissions made by a successor depositary whether in connection with a previous act or omission of the depositary or in connection with any matter arising wholly after the removal or resignation of the depositary, provided that in connection with the issue out of which such potential liability arises the depositary performed its obligations without negligence or bad faith while it acted as depositary. | |
| ● | have no obligation to appear in, prosecute or defend any action, suit or other proceeding related to the ADSs or the deposit agreement on your behalf or on behalf of any other person; | |
| ● | are not liable for the acts or omissions of any securities depository, clearing agency or settlement system; and | |
| ● | the depositary has no duty to make any determination or provide any information as to our tax status, or any liability for any tax consequences that may be incurred by ADS holders as a result of owning or holding ADSs or be liable for the inability or failure of an ADS holder to obtain the benefit of a foreign tax credit, reduced rate of withholding or refund of amounts withheld in respect of tax or any other tax benefit. |
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In the absence of bad faith on its part, the depositary shall not be responsible for any failure to carry out any instructions to vote any of the deposited securities, or for the manner in which any such vote is cast or the effect of any such vote.
In the deposit agreement, we and the depositary agree to indemnify each other under certain circumstances.
Requirements for Depositary Actions
Before the depositary will deliver or register a transfer of ADSs, make a distribution on ADSs, or permit withdrawal of shares, the depositary may require:
| ● | payment of stock transfer or other taxes or other governmental charges and transfer or registration fees charged by third parties for the transfer of any shares or other deposited securities; |
| ● | satisfactory proof of the identity and genuineness of any signature or other information it deems necessary; and |
| ● | compliance with regulations it may establish, from time to time, consistent with the deposit agreement, including presentation of transfer documents. |
The depositary may refuse to deliver ADSs or register transfers of ADSs when the transfer books of the depositary or our transfer books are closed or at any time if the depositary or we think it advisable to do so.
Your Right to Receive the Shares Underlying your ADSs
ADS holders have the right to cancel their ADSs and withdraw the underlying shares at any time except:
| ● | when temporary delays arise because: (i) the depositary has closed its transfer books, or we have closed our transfer books; (ii) the transfer of shares is blocked to permit voting at a shareholders’ meeting; or (iii) we are paying a dividend on our ordinary shares; |
| ● | when you owe money to pay fees, taxes and similar charges; |
| ● | when it is necessary to prohibit withdrawals in order to comply with any laws or governmental regulations that apply to ADSs or to the withdrawal of ordinary shares or other deposited securities; | |
| ● | or any other reason that, at the time, is permitted under paragraph I(A)(1) of the General Instructions to Form F-6 under the Securities Act or any successor to that provision. |
This right of withdrawal may not be limited by any other provision of the deposit agreement.
Direct Registration System
In the deposit agreement, all parties to the deposit agreement acknowledge that the Direct Registration System, also referred to as DRS, and Profile Modification System, also referred to as Profile, will apply to the ADSs. DRS is a system administered by DTC that facilitates interchange between registered holding of uncertificated ADSs and holding of security entitlements in ADSs through DTC and a DTC participant. Profile is a required feature of DRS that allows a DTC participant, claiming to act on behalf of a registered holder of uncertificated ADSs, to direct the depositary to register a transfer of those ADSs to DTC or its nominee and to deliver those ADSs to the DTC account of that DTC participant without receipt by the depositary of prior authorization from the ADS holder to register that transfer.
In connection with and in accordance with the arrangements and procedures relating to DRS/Profile, the parties to the deposit agreement understand that the depositary will not determine whether the DTC participant that is claiming to be acting on behalf of an ADS holder in requesting registration of transfer and delivery as described in the paragraph above has the actual authority to act on behalf of the ADS holder (notwithstanding any requirements under the Uniform Commercial Code). In the deposit agreement, the parties agree that the depositary’s reliance on and compliance with instructions received by the depositary through the DRS/Profile system and in accordance with the deposit agreement will not constitute negligence or bad faith on the part of the depositary.
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Shareholder Communications; Inspection of Register of Holders of ADSs
The depositary will make available for your inspection at its office all communications that it receives from us as a holder of deposited securities that we make generally available to holders of deposited securities. The depositary will send you copies of those communications or otherwise make those communications available to you if we ask it to. You have a right to inspect the register of holders of ADSs, but not for the purpose of contacting those holders about a matter unrelated to our business or the ADSs.
Jury Trial Waiver
The deposit agreement provides that, to the extent permitted by law, ADS holders waive the right to a jury trial of any claim they may have against us or the depositary directly or indirectly arising out of or relating to our shares, the ADSs or the deposit agreement, including any claim under the U.S. federal securities laws. If we or the depositary opposed a jury trial demand based on the waiver, the court would determine whether the waiver was enforceable in the facts and circumstances of that case in accordance with applicable case law.
You will not, by agreeing to the terms of the deposit agreement, be deemed to have waived our or the depositary’s compliance with U.S. federal securities laws or the rules and regulations promulgated thereunder.
The following summary of certain terms of the Warrants is not complete and is subject to, and qualified in its entirety by the provisions of the Form of Warrant to Purchase ADSs, which are filed as exhibits to the registration statement of which this prospectus is a part. Prospective investors should carefully review the terms set forth in the Form of Warrant to Purchase ADSs.
| ● | Exercisability. The Warrants are exercisable immediately upon issuance and at any time up to the date that is five years from the date of issuance. The Warrants will be exercisable, at the option of each holder, in whole or in part by delivering to us a duly executed exercise notice accompanied by payment in full for the number of ADSs purchased upon such exercise. The Company will pay any ADS issuance fee of up to US$0.10 per ADS and any other applicable charges and taxes in connection with any such exercise. The Warrant will be issued in electronic form. |
| ● | Maximum Percentage. A holder of a Warrant shall not have the right to exercise such Warrant, to the extent that after giving effect to such exercise, such person (together with such person’s affiliates and certain other persons), would beneficially own in excess of 4.99% (or, at the election of the purchaser, up to 9.99%) (the “Maximum Percentage”) of the ordinary shares outstanding immediately after giving effect to such exercise. Subject to certain exceptions, “beneficial ownership” for purposes of determining the Maximum Percentage is calculated in accordance with Section 13(d) of the Exchange Act and the regulations of the SEC thereunder. Upon request by a Warrant holder, we will provide current information regarding the number of our outstanding ordinary shares. |
| ● | Exercise Price. The initial exercise price per ADS purchasable upon exercise of the Warrants is equal to US$ . The Warrants may not be exercised on a “cashless” or “net exercise” basis except in certain limited circumstances. |
| ● | Anti-Dilution Provisions. The exercise price per Warrant and the numbers of Warrants shall be subject to adjustment from time to time in accordance with the ASX Listing Rules upon the occurrence of certain stock dividends and distributions, stock splits, stock subdivisions and combinations, reclassifications, rights issues, or similar events affecting our ADSs or ordinary shares, or upon the occurrence of a change in ADS ratio. |
| ● | Transferability. Subject to applicable laws, the Warrants may be transferred at the option of the holders upon surrender of the Warrants to us together with the appropriate instruments of transfer. |
| ● | Rights as a Shareholder. Except as otherwise provided by virtue of such holder’s ownership of ADSs or ordinary shares, the holder of Warrants does not have rights or privileges of a holder of ADSs or ordinary shares, including any voting rights, until the holder exercises the Warrant. |
| ● | Exchange Listing. We do not intend to list the Warrants offered in this offering on any securities exchange or other trading market. Without an active trading market, the liquidity of these securities will be limited. | |
| ● | Governing Law. The Warrants are governed by New York law. | |
| ● | Warrant Agent; Global Certificate. The Warrants will be issued in registered form under a warrant agency agreement between Computershare Inc., as warrant agent, and us. The Warrants will initially be represented only by one or more global warrants deposited with the warrant agent, as custodian on behalf of The Depository Trust Company, or DTC, and registered in the name of Cede & Co, a nominee of DTC, or as otherwise directed by DTC. |
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Shares and american depositary shares Eligible for Future Sale
Our ordinary shares have been trading on the ASX since 2023. While we have applied to list the ADSs on Nasdaq, we cannot assure you that an active trading market for the ADSs will develop.
Upon completion of the offering, we expect to have ADSs outstanding representing ordinary shares, or approximately 8% of our ordinary shares outstanding. In addition, we will have ordinary shares outstanding that are not represented by ADSs. If the underwriters exercise their option to purchase additional ADSs and Warrants in full, we will have ADSs outstanding, representing ordinary shares, or approximately 10% of our ordinary shares in issue and outstanding. All the ADSs and Warrants sold in this offering will be freely tradable without restrictions or further registration under the Securities Act, except for any ADSs and Warrants sold to our “affiliates,” as that term is defined under Rule 144 under the Securities Act.
Future sales of ADSs in the U.S. public market after this offering, and the availability of ADSs for future sale, could adversely affect the market price of the ADSs prevailing from time to time. As described below, a significant number of currently outstanding ordinary shares will not be available for sale shortly after this offering due to contractual restrictions on transfers of ordinary shares and ADSs. However, sales of substantial amounts of ADSs or ordinary shares, or the perception that these sales could occur, could adversely affect prevailing market prices for the ADSs and could impair our future ability to raise equity capital.
Rule 144
In general, a person who has beneficially owned restricted ordinary shares for at least six months would be entitled to sell their securities pursuant to Rule 144 under the Securities Act provided that (i) such person is not deemed to have been one of our affiliates at the time of, or at any time during the 90 days preceding, a sale and (ii) we have been subject to the Exchange Act periodic reporting requirements for at least 90 days before the sale. Persons who have beneficially owned restricted ordinary shares for at least six months, but who are our affiliates at the time of, or at any time during the 90 days preceding a sale, would be subject to additional restrictions, by which such person would be entitled to sell within any three-month period only a number of securities that does not exceed the greater of either of the following:
| ● | 1.0% of the number of ordinary shares (including ordinary shares in the form of ADSs) then outstanding; and |
| ● | the average weekly trading volume of our ordinary shares (including ordinary shares in the form of ADSs) during the four calendar weeks preceding the filing of a notice on Form 144 with respect to the sale, |
provided, in each case, that we have been subject to the Exchange Act periodic reporting requirements for at least 90 days before the sale. Such sales both by affiliates and by non-affiliates must also comply with the manner of sale, current public information and notice provisions of Rule 144. Non-affiliate resales of restricted shares under Rule 144 also are subject to the availability of current public information about us until a period of one year has elapsed since the securities were acquired from the issuer or an affiliate of the issuer.
Rule 701
Rule 701 under the Securities Act permits resales of shares in reliance upon Rule 144 but without compliance with certain restrictions of Rule 144, including the holding period requirement. Most of our employees, executive officers or directors who purchased shares under a written compensatory plan or contract may be entitled to rely on the resale provisions of Rule 701, but all holders of Rule 701 shares are required to wait until 90 days after the date of this prospectus before selling their shares subject also to Australian law.
The SEC has indicated that Rule 701 will apply to typical options granted by an issuer before it becomes subject to the reporting requirements of the Exchange Act, along with the shares acquired upon exercise of such options, including exercises after an issuer becomes subject to the reporting requirements of the Exchange Act.
Lock-up Agreements
Our directors and officers have agreed, subject to some exceptions, not to transfer or dispose of, directly or indirectly, any of our ordinary shares, in the form of ADSs or otherwise, or any securities convertible into or exchangeable or exercisable for our ordinary shares, in the form of ADSs or otherwise, for a period of 180 days after the date of this prospectus. After the expiration of the 180-day period, the ordinary shares or ADSs held by our directors, executive officers and our major shareholders may be sold subject to any applicable restrictions under the Securities Act or in the United States by means of registered public offerings.
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Material United States Federal Income and Australian Tax Considerations
The following summary of the material Australian and U.S. federal income tax consequences of an investment in the ADSs or Warrants is based upon laws and relevant interpretations thereof in effect as of the date of this prospectus, all of which are subject to change, possibly with retroactive effect. This summary does not deal with all possible tax consequences relating to an investment in the ADSs or Warrants, such as the tax consequences under U.S. state, local and other tax laws other than U.S. federal income tax laws and certain Australian tax laws.
Holders of the ADSs and Warrants should consult their own tax advisors as to the United States, Australian or other tax consequences of the purchase, ownership and disposition of ADSs and Warrants, including, in particular, the effect of any foreign, state or local taxes.
Australian Taxation
In this section we discuss the material Australian tax considerations that apply to non-Australian tax residents with respect to the acquisition, ownership and disposal of the absolute beneficial ownership of ADSs or Warrants, which are evidenced by ADSs and Warrants. This discussion is based upon existing Australian tax law as of the date of this Registration Statement, which is subject to change, possibly retrospectively. This discussion does not address all aspects of Australian income tax law which may be important to particular investors in light of their individual investment circumstances, such as ADSs or Warrants held by investors subject to special tax rules (for example, financial institutions, insurance companies or tax exempt organizations). In addition, this summary does not discuss any foreign or state tax considerations, other than stamp duty. Prospective investors are urged to consult their tax advisors regarding the Australian and foreign income and other tax considerations of the purchase, ownership and disposition of the ADSs or Warrants.
Nature of ADSs and Warrants for Australian Taxation Purposes
Holders of the ADSs and Warrants are treated as the owners of the underlying ordinary shares for Australian income tax and capital gains tax purposes. Therefore, dividends paid on the underlying ordinary shares will be treated for Australian tax purposes as if they were paid directly to the owners of ADSs and Warrants, and the disposal of ADSs and Warrants will be treated for Australian tax purposes as the disposal of the underlying ordinary shares. In the following analysis we discuss the application of the Australian income tax and capital gains tax rules to non-Australian resident holders of ADSs and Warrants.
Taxation of Dividends
Australia operates a dividend imputation system under which dividends may be declared to be “franked” to the extent they are paid out of company profits that have been subject to income tax. Fully franked dividends are not subject to dividend withholding tax. Dividends that are not franked or are partly franked and are paid to non-Australian resident shareholders are subject to dividend withholding tax, but only to the extent the dividends are not franked.
Dividends paid to a non-resident shareholder are subject to withholding tax (a) except to the extent they have been franked and (b) at 30%, unless the shareholder is a resident of a country with which Australia has a double taxation agreement.
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In accordance with the provisions of the Double Taxation Convention between Australia and the United States, the maximum rate of Australian tax on any unfranked portion of a dividend to which a resident of the United States is beneficially entitled is 15%, where the U.S. resident holds less than 10% of the voting rights in our company, or 5% where the U.S. resident holds 10% or more of the voting rights in our company. Special rules apply to Regulated Investment Companies and Real Estate Investment Trusts that hold shares and receive dividends. The Double Taxation Convention between Australia and the United States does not apply to limit the tax rate on dividends where the ADSs are effectively connected to a permanent establishment or a fixed base carried on by the owner of the ADSs in Australia through which the shareholder carries on business or provides independent personal services, respectively.
Exercise, Expiration and Disposition of Warrants
A U.S. holder will not recognize gain or loss upon exercise of a Warrant (except with respect to any cash received in lieu of a fractional ordinary share or ADS). A U.S. holder will have a tax basis in the ADSs received upon the exercise of a Warrant equal to the sum of its tax basis in the Warrant and the aggregate cash exercise price paid in respect of such exercise, less any amount attributable to any fractional ordinary share or ADS. The holding period of the ordinary shares or ADSs received upon the exercise of a Warrant will commence on the day after the Warrant is exercised. If a Warrant expires without being exercised, a U.S. holder will recognize a capital loss in an amount equal to its tax basis in the Warrant.
Subject to the passive foreign investment company rules discussed below, upon the sale, exchange or redemption of a Warrant, a U.S. holder will recognize a gain or loss equal to the difference between the amount realized on the sale, exchange or redemption of the Warrant and the U.S. holder’s tax basis in such Warrant. Such gain or loss will be long-term capital gain or loss if, at the time of such sale, exchange, or redemption, the Warrant has been held for more than one year. Long term capital gains of individuals (as well as certain trusts and estates) are subject to U.S. federal income tax at preferential rates. The deductibility of capital losses is subject to significant limitations. A U.S. holder’s gain or loss on the sale, exchange, or redemption of a Warrant will be treated as U.S. source income or loss for U.S. foreign tax credit limitation purposes.
In the event we are a passive foreign investment company, a U.S. holder will be taxed upon the sale, exchange, redemption or other taxable disposition of a Warrant in the same manner that such U.S. holder would be taxed upon the sale, exchange, redemption or other taxable disposition of shares in a passive foreign investment company, except that the Warrants will not be eligible for the mark-to-market election. See the discussion under “—Passive Foreign Investment Companies” below.
Tax on Sales or other Dispositions of Shares — Capital Gains Tax
Australian capital gains derived by non-Australian residents in respect of the disposal of capital assets that are not taxable Australian property will be disregarded. Non-Australian resident shareholders will not be subject to Australian capital gains tax on the capital gain made on a disposal of our shares, unless they, together with associates, hold 10% or more of our issued capital, tested either at the time of disposal or over any continuous 12 month period in the 24 months prior to disposal, and the value of our shares at the time of disposal is principally attributable to Australian real property assets.
Australian capital gains tax applies to net capital gains at a taxpayer’s marginal tax rate but for certain shareholders a discount capital gain may apply if the shares have been held for 12 months or more. For individuals, this discount is 50%. Net capital gains are calculated after reduction for capital losses (including certain prior year capital losses), which may only be offset against capital gains.
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Tax on Sales or other Dispositions of Shares — Shareholders Holding Shares on Revenue Account
Some non-Australian resident shareholders may hold shares on revenue rather than on capital account, for example, share traders. These shareholders may have the gains made on the sale or other disposal of the shares included in their assessable income under the ordinary income provisions of the income tax law, if the gains are sourced in Australia.
Non-Australian resident shareholders assessable under these ordinary income provisions in respect of gains made on shares held on revenue account would be assessed for such gains at the Australian tax rates for non-Australian residents, which start at a marginal rate of 32.5% for non-Australian resident individuals. Some relief from the Australian income tax may be available to such non-Australian resident shareholders under the Double Taxation Convention between the United States and Australia, for example, because the shareholder does not have a permanent establishment in Australia.
To the extent an amount would be included in a non-Australian resident shareholder’s assessable income under both the capital gains tax provisions and the ordinary income provisions, the capital gain amount would generally be reduced, so that the shareholder would not be subject to double tax on any part of the income gain or capital gain.
Dual Residency
If a shareholder were a resident of both Australia and the United States under those countries’ domestic taxation laws, that shareholder may be subject to tax as an Australian resident. If, however, the shareholder is determined to be a U.S. resident for the purposes of the Double Taxation Convention between the United States and Australia, the Australian tax applicable would be limited by the Double Taxation Convention. Shareholders should obtain specialist taxation advice in these circumstances.
Stamp Duty
A transfer of shares of a company listed on the ASX is not subject to Australian stamp duty.
Australian Death Duty
Australia does not have estate or death duties. No capital gains tax liability is realized upon the inheritance of a deceased person’s shares. The disposal of inherited shares by beneficiaries, may, however, give rise to a capital gains tax liability.
Goods and Services Tax
The issue or transfer of shares will not incur Australian goods and services tax.
U.S. Taxation
The following is a summary of material U.S. federal income tax consequences that generally apply to U.S. Holders (as defined below) who hold ADSs as capital assets within the meaning of Section 1221 of the Internal Revenue Code of 1986, as amended (the “Code”). This summary is based on the Code, its legislative history, final, temporary and proposed United States Treasury regulations promulgated thereunder, published rulings and court decisions, and the bilateral income tax convention between Australia and the United States (the “Treaty”), all as in effect on the date hereof and all of which are subject to change, or changes in interpretation, either prospectively or retroactively. This discussion does not address all of the tax consequences relating to the purchase, ownership, and disposition of ADSs and does not take into account U.S. Holders who may be subject to special rules, including: financial institutions, insurance companies, , tax-exempt organizations, real estate investment trusts, regulated investment companies, grantor trusts, non-resident aliens of the United States or taxpayers whose functional currency is not the U.S. dollar, persons who hold the ADSs through partnerships or other pass-through entities, persons who acquired their ADSs through the exercise or cancellation of any employee share options or otherwise as compensation for their services, investors that actually or constructively own 10% or more of our shares, dealers or traders in securities or currencies, certain former citizens or long-term residents of the United States, dual resident corporations, persons that generally mark their securities to market for United States federal income tax purposes, persons who are residents of Australia for Australian income tax purposes, and investors holding ADSs as part of a straddle or appreciated financial position or as part of a hedging or conversion transaction. This summary does not address the Medicare tax imposed on certain investment income, any state, local and foreign tax considerations or any U.S. federal estate, gift or alternative minimum tax considerations relevant to the purchase, ownership and disposition of the ADSs. In addition, this discussion is based in part upon the assumption that each obligation in the deposit agreement and any related agreements will be performed according to its terms.
If a partnership or an entity or arrangement treated as a partnership for U.S. federal income tax purposes owns ADSs, the U.S. federal income tax treatment of its partners will generally depend upon the status of the partner and the activities of the partnership. A partnership should consult its tax advisors regarding the U.S. federal income tax consequences applicable to it and its partners of the purchase, ownership and disposition of ADSs.
For purposes of this summary, the term “U.S. Holder” means a beneficial owner of ADSs that is for U.S. federal income tax purposes: an individual who is a citizen or resident of the United States; a corporation that is created or organized in or under the laws of the United States or any political subdivision thereof; an estate whose income is subject to U.S. federal income tax regardless of its source; or a trust if (a) a court within the United States is able to exercise primary supervision over administration of the trust, and one or more U.S. persons have the authority to control all substantial decisions of the trust or (b) it has a valid election in effect under applicable U.S. Treasury regulations to be treated as a U.S. person.
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Distributions
For U.S. federal income tax purposes, a U.S. Holder of ADSs will be treated as owning the ordinary shares underlying the ADSs. Subject to the passive foreign investment company rules discussed below, the gross amount of any distribution received by a U.S. Holder with respect to our ordinary shares or ADSs, including the amount of any Australian taxes withheld therefrom, will be included in gross income as a dividend to the extent the distribution is paid out of our current or accumulated earnings and profits (as determined under U.S. federal income tax principles). Distributions in excess of our earnings and profits will be treated first as a non-taxable return of capital to the extent of a U.S. Holder’s tax basis in the ADSs and thereafter will be treated as gain from the sale or exchange of the ADSs. We have not maintained and do not plan to maintain calculations of earnings and profits for U.S. federal income tax purposes. As a result, a U.S. Holder may need to include the entire amount of any such distribution in income as a dividend. Dividends will not, however, be eligible for the “dividends received deduction” generally allowed to corporate shareholders with respect to dividends received from U.S. corporations.
The U.S. dollar value of any distribution on the ADSs made in Australian dollars generally should be calculated by reference to the spot exchange rate between the U.S. dollar and the Australian dollar in effect on the date the distribution is actually or constructively received by the U.S. Holder regardless of whether the Australian dollars so received are in fact converted into U.S. dollars. A U.S. Holder who receives payment in Australian dollars and converts those Australian dollars into U.S. dollars at an exchange rate other than the rate in effect on such day may have a foreign currency exchange gain or loss, which would generally be treated as ordinary income or loss from sources within the United States for U.S. foreign tax credit purposes.
Subject to complex limitations and certain holding period requirements, a U.S. Holder may elect to claim a credit for Australian tax withheld from distributions against its U.S. federal income tax liability. The limitations set out in the Code include computational rules under which foreign tax credits allowable with respect to specific classes of income cannot exceed the U.S. federal income taxes otherwise payable with respect to each such class of income. Dividends generally will be treated as foreign-source passive category income for U.S. foreign tax credit purposes or in the case of certain U.S. Holders as foreign source “general category” income. A U.S. Holder that does not elect to claim a U.S. foreign tax credit may instead claim a deduction for Australian tax withheld.
Subject to certain limitations, dividends received by a non-corporate U.S. Holder are subject to tax at a reduced maximum tax rate of 20 percent if the dividends are “qualified dividends”. Dividends are qualified dividends if: (a)(i) the issuer is entitled to benefits under the Treaty or (ii) the shares are readily tradable on an established securities market in the United States and (b) certain other requirements are met. We believe that we are entitled to benefits under the Treaty and that the ADSs currently are readily tradable on an established securities market in the United States. However, no assurance can be given that the ADSs will remain readily tradable. Further, the reduced rate does not apply to dividends if we are a PFIC in the year prior to or the year in which the dividend is paid.
The U.S. Treasury has expressed concerns that intermediaries in the chain of ownership between the holder of an ADS and the issuer of the security underlying the ADS may be taking actions that are inconsistent with the claiming of foreign tax credits for U.S. Holders of ADSs. Such actions would also be inconsistent with the claiming of the reduced rate of tax, described above, applicable to dividends received by certain non-corporate holders. Accordingly, the analysis of the creditability of Australian taxes and the availability of the reduced tax rate for dividends received by certain non-corporate holders, each described above, could be affected by actions taken by intermediaries in the chain of ownership between the holder of an ADS and our Company.
Disposition of ADSs
If you sell or otherwise dispose of ADSs, you will recognize gain or loss for U.S. federal income tax purposes in an amount equal to the difference between the U.S. dollar value of the amount realized on the sale or other disposition and your adjusted tax basis in the ADSs. Subject to the passive foreign investment company rules discussed below, such gain or loss generally will be capital gain or loss and will be long-term capital gain or loss if you have held the ADSs for more than one year at the time of the sale or other disposition. In general, any gain that you recognize on the sale or other disposition of ADSs will be gain from U.S. sources for purposes of the foreign tax credit limitation; losses will generally be allocated against U.S. source income. The deduction of capital losses is subject to certain limitations under the Code.
In the case of a cash-basis U.S. Holder who receives Australian dollars in connection with the sale or other disposition of ADSs, the amount realized will be calculated based on the U.S. dollar value of the Australian dollars received as determined by reference to the spot rate in effect on the settlement date of such exchange. A U.S. Holder who receives payment in Australian dollars and converts Australian dollars into U.S. dollars at a conversion rate other than the rate in effect on the settlement date may have foreign currency exchange gain or loss that would be treated as ordinary income or loss from sources within the United States for U.S. foreign tax credit purposes.
An accrual-basis U.S. Holder may elect the same treatment required of cash-basis taxpayers with respect to a sale or disposition of ADSs, provided that the election is applied consistently from year to year. Such election may not be changed without the consent of the Internal Revenue Service (“IRS”). In the event that an accrual-basis U.S. Holder does not elect to be treated as a cash-basis taxpayer (pursuant to the Treasury regulations applicable to foreign currency transactions), such U.S. Holder may have foreign currency gain or loss for U.S. federal income tax purposes because of differences between the U.S. dollar value of the currency received prevailing on the trade date and the settlement date. Any such currency gain or loss would be treated as ordinary income or loss from sources within the United States for U.S. foreign tax credit purposes. However, if foreign currency is converted into U.S. dollars on the date received by the U.S. Holder, a cash-basis or electing accrual-basis U.S. Holder should not recognize any gain or loss on such conversion.
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Passive Foreign Investment Companies
There is a risk that we may be a passive foreign investment company (“PFIC”), for U.S. federal income tax purposes. Our treatment as a PFIC could result in a reduction in the after-tax return to the U.S. Holders of the ADSs and may cause a reduction in the value of such securities.
For U.S. federal income tax purposes, we will be classified as a PFIC for any taxable year in which (i) 75% or more of our gross income is passive income, or (ii) at least 50% of the average value of all of our assets for the taxable year produce or are held for the production of passive income. For this purpose, cash is considered to be an asset which produces passive income. Passive income for these purposes generally includes dividends, interest, royalties, rents, annuities and the excess of gains over losses from the disposition of assets which produce passive income. In making a PFIC determination, we will be treated as owning our proportionate share of the assets and earning our proportionate share of the income of any other corporation in which we own, directly or indirectly, 25% or more (by value) of the share capital. Based on the composition of our assets and income, we believe that we should not be treated as a PFIC for U.S. federal income tax purposes with respect to fiscal year 2026. However, the determination of PFIC status is a factual determination that must be made annually at the close of each taxable year and, therefore, there can be no certainty as to our status in this regard until the close of the current or any future taxable year. Changes in the nature of our income or assets or a decrease in the trading price of the ADSs may cause us to be considered a PFIC in the current or any subsequent year. If we were a PFIC in any year during a U.S. Holder’s holding period for the ADSs, we would ordinarily continue to be treated as a PFIC for each subsequent year during which the U.S. Holder owned the ADSs.
Under the default PFIC “excess distribution” regime, if we are a PFIC in any taxable year during which a U.S. Holder owns ADSs, such U.S. Holder could be liable for additional taxes and interest charges upon (i) certain distributions by us (generally any distribution paid during a taxable year that is greater than 125 percent of the average annual distributions paid in the three preceding taxable years, or, if shorter, the U.S. Holder’s holding period for the ADSs), and (ii) any gain realized on a sale, exchange or other disposition, including a pledge, of the ADSs, whether or not we continue to be a PFIC for the year of the disposition. In these circumstances, the tax will generally be determined by allocating such distributions or gain ratably over the U.S. Holder’s holding period for the ADSs. The amount allocated to the current taxable year and any year prior to the first taxable year in which we are a PFIC will be taxed as ordinary income (rather than capital gain) earned in the current taxable year. The amount allocated to other taxable years will be taxed at the highest applicable marginal rates for the year and an interest charge at the rate applicable to underpayments of tax will also be imposed on the amount of taxes allocated to such other taxable years.
An indirect shareholder may be taxed on a distribution paid to the direct owner of a PFIC and on a disposition of the share indirectly owned. Indirect shareholders are strongly urged to consult their tax advisors regarding the application of these rules.
If we are a PFIC and subsequently cease to be a PFIC in a future year, a U.S. Holder may avoid the continued application of the tax treatment described above by electing to be treated as if it sold its ADSs on the last day of the last taxable year in which we were a PFIC. Any gain would generally be recognized and subject to tax under the excess distribution regime described above. Loss would not be recognized. A U.S. Holder’s basis in its ADSs would be increased by the amount of gain, if any, recognized on the deemed sale. A U.S. Holder would be required to treat its holding period for its ADSs as beginning on the day following the last day of the last taxable year in which we were a PFIC.
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If the ADSs are considered “marketable stock” and if a U.S. Holder properly elects to “mark-to-market” its ADSs in a timely fashion, the U.S. Holder would not be subject to tax under the excess distribution regime described above. Instead, the U.S. Holder would generally include in income any excess of the fair market value of the ADSs at the close of each tax year over the adjusted tax basis of the ADSs. If the fair market value of the ADSs had depreciated below the adjusted basis at the close of the tax year, the U.S. Holder would be entitled to deduct the excess of the adjusted basis of the ADSs over their fair market value at that time. However, such deductions generally would be limited to the net mark-to-market gains, if any, the U.S. Holder included in income with respect to such ADSs in prior years. Income recognized and deductions allowed under the mark-to-market provisions, as well as any gain or loss on the disposition of ADSs with respect to which the mark-to-market election is made, is treated as ordinary income or loss (except that loss is treated as capital loss to the extent the loss exceeds the net mark-to-market gains, if any, that a U.S. Holder included in income with respect to such ordinary shares in prior years). However, gain or loss from the disposition of ADSs (as to which a “mark-to-market” election was properly made) in a year in which we are no longer a PFIC, will be capital gain or loss. Our ordinary shares or ADSs will be “marketable” stock as long as they remain regularly traded on a national securities exchange, such as the Nasdaq, or a foreign securities exchange regulated by a governmental authority of the country in which the market is located and which meets certain requirements, including that the rules of the exchange effectively promote active trading of listed stocks. If such stock is traded on such a qualified exchange or other market, such stock generally will be “regularly traded” for any calendar year during which such stock is traded, other than in de minimis quantities, on at least 15 days during each calendar quarter, but no assurances can be given in this regard. Our ordinary shares are traded on the ASX, which may qualify as an eligible foreign securities exchange for this purpose. Because a mark-to-market election cannot be made for any lower-tier PFICs that we may own, a U.S. Holder may continue to be subject to the PFIC rules with respect to such holder’s indirect interest in any investments held by us that are treated as an equity interest in a PFIC for U.S. federal income tax purposes, including shares in any of our subsidiaries that are treated as PFICs.
A U.S. Holder of ADSs should not be able to avoid the tax consequences described above by electing to treat us as a qualified electing fund. In general, a qualified electing fund is, with respect to a U.S. person, a PFIC if the U.S. person has elected to include its proportionate share of a company’s ordinary earnings and net capital gains in U.S. income on an annual basis. A qualified electing fund election can only be made with respect to us if we provide U.S. Holders with certain information on an annual basis and we do not intend to prepare the information that U.S. Holders would need to make the qualified electing fund election.
Backup Withholding and Information Reporting
Payments in respect of ADSs may be subject to information reporting to the IRS and to U.S. backup withholding tax (at a rate of 24% under current law). Backup withholding will not apply, however, if a U.S. Holder (i) is a corporation, (ii) satisfies an applicable exemption, or (iii) furnishes correct taxpayer identification.
Backup withholding is not an additional tax. Amounts withheld under the backup withholding rules may be credited against a U.S. Holder’s U.S. tax liability, and a U.S. Holder may obtain a refund of any excess amounts withheld under the backup withholding rules by filing the appropriate claim for refund with the IRS.
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We are offering the ADSs and Warrants described in this prospectus through Maxim Group LLC as the sole representative of the underwriters (“Maxim” or the “Representative”). We will enter into an underwriting agreement with Maxim. Subject to the terms and conditions of the underwriting agreement, we have agreed to sell to each underwriter, and each underwriter named below has severally agreed to purchase, at the public offering price less the underwriting discounts set forth on the cover page of this prospectus, the number of ADSs and Warrants listed next to its name in the following table:
| Underwriter | Number of ADSs and accompanying Warrants | |
| Maxim Group LLC |
The underwriting agreement provides that the underwriters must buy all of the ADSs and Warrants being sold in this offering if it buys any of them. However, the underwriters are not required to take or pay for the ADSs or Warrants covered by the underwriters’ option to purchase additional ADSs and/or Warrants as described below.
Option to Purchase Additional Securities
We have granted the underwriters an option exercisable within 45 days of the date of this prospectus to purchase from us up to additional 120,000 ADSs and/or 120,000 Warrants. The option may be used to purchase such ADSs and/or Warrants, or any combination thereof, as determined by the underwriters. If the underwriters exercise all or part of this option, they will purchase securities covered by the option at the public offering price that appears on the cover page of this prospectus, less the underwriting discounts and commissions to cover over-allotments, if any.
Discount, Commissions and Expenses
ADSs and Warrants sold by the underwriters to the public will initially be offered at the initial offering price set forth on the cover of this prospectus. In addition, the underwriters may offer some of the ADSs and Warrants to other securities dealers at such price less a concession of US$_____ per ADS and Warrant. If all the ADSs and Warrants are not sold at the public offering price, the underwriters may change the offering price and the other selling terms. Upon execution of the underwriting agreement, the underwriter will be obligated to purchase the ADSs and Warrants at the prices and upon the terms stated therein.
The following table shows the per ADS and accompanying Warrant amount and total underwriting discount we will pay to the underwriters assuming both no exercise and full exercise of the underwriter’s option to purchase from us up to 120,000 additional ADSs and/or up to 120,000 additional Warrants, less the underwriting discounts and commissions to cover over-allotments, if any.
| Per ADS and accompanying |
No
Exercise of |
Full Exercise of Over-Allotment |
|||||||||
| Warrant | Total | Total | |||||||||
| Public offering price | US$ | US$ | US$ | ||||||||
| Underwriting discounts and commissions(1) | US$ | US$ | US$ | ||||||||
| Proceeds to us, before expenses | US$ | US$ | US$ |
| (1) | The underwriting discount and commissions shall equal up to 8.0% of the gross proceeds of the ADSs and Warrants sold by us in this offering. |
We have agreed to pay the Representative’s out-of-pocket accountable expenses, actually incurred, including the Representative’s legal fees, up to a maximum amount of US$125,000 if this offering is completed and up to US$50,000 if this offering is not completed.
We have paid an expense deposit of US$25,000 to the Representative, which will be applied against the accountable expenses that will be paid by us to the Representative in connection with this offering.
We estimate that the total expenses of the offering payable by us, not including the underwriting discounts and commissions, will be approximately US$770,000. This amount includes the Representative’s expenses described above.
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Underwriting Discount
We must pay an underwriting discount of up to 8.0% of the public offering price with respect to ADSs and Warrants issued.
Representative’s Warrant
We have agreed to issue the Representative’s Warrant to Maxim, or its designees, upon the closing of this offering, which entitle it to purchase a number of ADSs equal to 5.0% of the total ADSs sold at the closing of this offering. The Representative’s Warrant will be exercisable at a per ADS exercise price equal to US$__ (125% of the public offering price). The Representative’s Warrant will be exercisable immediately upon issuance, at any time and from time to time, in whole or in part, during the five-year period commencing from the commencement of sales of this offering. The Representative’s Warrant may not be transferred, assigned or hypothecated for a period of six (6) months following the Closing, except as permitted pursuant to FINRA Rule 5110(e)(2). The Representative’s Warrant will provide for cashless exercise and will contain provisions for one demand registration of the sale of the underlying ADSs at the Company’s expense, an additional demand registration at the warrant holders’ expense, and unlimited “piggyback” registration rights for a period of five (5) years after the closing of this offering at the Company’s expense. The Representative’s Warrant shall further provide for anti-dilution protection (adjustment in the number and price of such warrants and the ADSs underlying such warrants) resulting from corporate events (which would include dividends, reorganizations, mergers, stock splits, etc.) and will, at all times, comply with applicable law and the rules of any applicable securities exchange. The Representative’s Warrant and the ADSs underlying the Representative’s Warrant are being registered on the registration statement of which this prospectus is a part.
Tail Financing Payments
Upon closing of this offering, or if we terminate our engagement agreement with Maxim (other than for cause), then upon such termination, we subsequently complete any financing of equity, equity-linked, convertible or debt or other capital raising activity from which the Company receives any proceeds any time during the twelve (12) months after closing of the offering or upon such termination with any investors contacted or introduced to the Company by Maxim, then Maxim shall be entitled to receive up to an 8.0% cash fee and the same warrant compensation for such offering as it would have been entitled to in connection with this offering.
Right of First Refusal
Upon the closing this offering or an Alternative Offering (as defined in our engagement agreement with Maxim) for a period of eighteen (18) months from such closing, the Company grants Maxim the right of first refusal to act as sole managing underwriter and sole book runner, sole placement agent, or sole sales agent, for any and all future public or private equity, equity-linked, convertible or debt (excluding commercial bank debt) offerings for which the Company retains the service of an underwriter, agent, advisor, finder or other person or entity in connection with such offering during such eighteen (18) month period of the Company, or any successor to or any subsidiary of the Company. The Company shall not offer to retain any entity or person in connection with any such offering on terms more favorable than terms on which it offers to retain Maxim. Such offer shall be made in writing in order to be effective. Maxim shall notify the Company within ten (10) business days of its receipt of the written offer contemplated above as to whether or not it agrees to accept such retention. If Maxim should decline such retention, the Company shall have no further obligations to Maxim with respect to the offering for which it has offered to retain Maxim, except as otherwise provided for herein.
Lock-Up Agreements
We and each of our officers, and directors, and its major shareholder have agreed, subject to certain exceptions, not to offer, issue, sell, contract to sell, encumber for the sale of or otherwise dispose of any of the ADSs or ordinary shares or other securities convertible into or exercisable or exchangeable for the ADSs or ordinary shares for six (6) months after this offering is completed without the prior written consent of the Representative.
The Representative may in its sole discretion and at any time without notice release some or all of the securities subject to lock-up agreements prior to the expiration of the lock-up period. When determining whether or not to release securities from the lock-up agreements, the Representative will consider, among other factors, the security holder’s reasons for requesting the release, the number of securities for which the release is being requested and market conditions at the time.
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Indemnification
We have agreed to indemnify the underwriters against certain liabilities, including certain liabilities under the Securities Act. If we are unable to provide this indemnification, we have agreed to contribute to payments the underwriter may be required to make in respect of those liabilities.
Stock Exchange
Our Ordinary Shares are presently quoted on the ASX under the symbol “CHW”. We have applied to list the ADSs on the Nasdaq Capital Market under the symbol “CHWM”. No assurance can be given that our application will be approved. In addition, there is no established public trading market for the Warrants and we do not expect a market to develop. We do not intend to apply for a listing of the Warrants on any national securities exchange.
Depositary
The depositary for the ADS program is The Bank of New York Mellon.
Determination of Offering Price
The actual public offering price of the ADSs and Warrants we are offering was negotiated between us and the underwriter based on the trading of our ordinary shares of the ASX prior to the offering, among other things. Other factors considered in determining the public offering price of the securities we are offering include our history and prospects, the stage of development of our business, our business plans for the future and the extent to which they have been implemented, an assessment of our management, the general conditions of the securities markets at the time of the offering and such other factors as were deemed relevant.
Electronic Distribution
A prospectus in electronic format may be made available on a website maintained by the underwriter. In connection with the offering, the underwriter or selected dealers may distribute prospectuses electronically. No forms of electronic prospectus other than prospectuses that are printable as Adobe® PDF will be used in connection with this offering.
Other than the prospectus in electronic format, the information on the underwriter’s website and any information contained in any other website maintained by the underwriter is not part of the prospectus or the registration statement of which this prospectus forms a part, has not been approved and/or endorsed by us or the underwriter in its capacity as an underwriter and should not be relied upon by investors.
Price Stabilization, Short Positions
In connection with the offering the underwriters may engage in stabilizing transactions, over-allotment transactions, syndicate covering transactions and penalty bids in accordance with Regulation M under the Exchange Act.
| ● | Stabilizing transactions permit bids to purchase the underlying security so long as the stabilizing bids do not exceed a specified maximum. |
| ● | Over-allotment involves sales by the underwriters of ADSs in excess of the number of ADSs the underwriters are obligated to purchase, which creates a syndicate short position. The short position may be either a covered short position or a naked short position. In a covered short position, the number of ADSs over-allotted by the underwriters is not greater than the number of ADSs that they may purchase in the over-allotment option. In a naked short position, the number of ADSs involved is greater than the number of ADSs in the over-allotment option. The underwriters may close out any covered short position by either exercising their over-allotment option and/or purchasing ADSs in the open market. |
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| ● | Syndicate covering transactions involve purchases of the ADSs in the open market after the distribution has been completed in order to cover syndicate short positions. In determining the source of ADSs to close out the short position, the underwriters will consider, among other things, the price of ADSs available for purchase in the open market as compared to the price at which they may purchase ADSs through the over-allotment option. If the underwriters sell more ADSs than could be covered by the over-allotment option, a naked short position, the position can only be closed out by buying ADSs in the open market. A naked short position is more likely to be created if the underwriters are concerned that there could be downward pressure on the price of the ADSs in the open market after pricing that could adversely affect investors who purchase in the offering. |
| ● | Penalty bids permit the Representative to reclaim a selling concession from a syndicate member when the ADSs originally sold by the syndicate member is purchased in a stabilizing or syndicate covering transaction to cover syndicate short positions. |
These stabilizing transactions, syndicate covering transactions and penalty bids may have the effect of raising or maintaining the market price of the ADSs or preventing or retarding a decline in the market price of the ADSs. As a result, the price of the ADSs may be higher than the price that might otherwise exist in the open market. These transactions may be effected on the Nasdaq or otherwise and, if commenced, may be discontinued at any time.
Other Relationships and Affiliations
Certain of the underwriters and their affiliates are full service financial institutions engaged in various activities, which may include securities trading, commercial and investment banking, financial advisory, investment management, investment research, principal investment, hedging, financing and brokerage activities. The underwriters and their affiliates may from time to time in the future engage with us and perform services for us or in the ordinary course of their business for which they will receive customary fees and expenses. In the ordinary course of their various business activities, the Underwriter and its affiliates may make or hold a broad array of investments and actively trade debt and equity securities (or related derivative securities) and financial instruments (including bank loans) for their own account and for the accounts of their customers, and such investment and securities activities may involve securities and/or instruments of us. The underwriters and their affiliates may also make investment recommendations and/or publish or express independent research views in respect of these securities or instruments and may at any time hold, or recommend to clients that it acquires, long and/or short positions in these securities and instruments.
Selling Restrictions
Other than in the United States, no action has been taken by us or the underwriter that would permit a public offering of the securities offered by this prospectus in any jurisdiction where action for that purpose is required. The securities offered by this prospectus may not be offered or sold, directly or indirectly, nor may this prospectus or any other offering material or advertisements in connection with the offer and sale of any such securities be distributed or published, in any jurisdiction, except under circumstances that will result in compliance with the applicable rules and regulations of that jurisdiction. Persons into whose possession this prospectus comes are advised to inform themselves about and to observe any restrictions relating to this offering and the distribution of this prospectus, including the restrictions discussed below. This prospectus does not constitute an offer to sell or a solicitation of an offer to buy any securities offered by this prospectus in any jurisdiction in which such an offer or a solicitation is unlawful.
Australia. No placement document, prospectus, product disclosure statement or other disclosure document has been lodged with the Australian Securities and Investments Commission (ASIC), in relation to the offering.
This prospectus does not constitute a prospectus, product disclosure statement or other disclosure document under the Corporations Act 2001 (Cth) (the “Corporations Act”) and does not purport to include the information required for a prospectus, product disclosure statement or other disclosure document under the Corporations Act. Any offer in Australia of the securities may only be made to persons (the Exempt Investors) who are “sophisticated investors” (within the meaning of section 708(8) of the Corporations Act), “professional investors” (within the meaning of section 708(11) of the Corporations Act) or otherwise pursuant to one or more exemptions contained in section 708 of the Corporations Act so that it is lawful to offer the securities without disclosure to investors under Chapter 6D of the Corporations Act.
The securities applied for by Exempt Investors in Australia must not be offered for sale in Australia in the period of 12 months after the date of allotment under the offering, except in circumstances where disclosure to investors under Chapter 6D of the Corporations Act would not be required pursuant to an exemption under section 708 of the Corporations Act or otherwise or where the offer is pursuant to a disclosure document which complies with Chapter 6D of the Corporations Act. Any person acquiring securities must observe such Australian on-sale restrictions.
This prospectus contains general information only and does not take account of the investment objectives, financial situation or particular needs of any particular person. It does not contain any securities recommendations or financial product advice. Before making an investment decision, investors need to consider whether the information in this prospectus is appropriate to their needs, objectives and circumstances, and, if necessary, seek expert advice on those matters.
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Brazil. The offer of securities described in this prospectus will not be carried out by means that would constitute a public offering in Brazil under Law No. 6,385, of December 7, 1976, as amended, under the CVM Rule (Instrução) No. 400, of December 29, 2003. The offer and sale of the securities have not been and will not be registered with the Comissão de Valores Móbilearios in Brazil. The securities have not been offered or sold, and will not be offered or sold in Brazil, except in circumstances that do not constitute a public offering or distribution under Brazilian laws and regulations.
Canada. The securities may be sold in Canada only to purchasers purchasing, or deemed to be purchasing, as principal that are “accredited investors”, as defined in National Instrument 45-106 Prospectus Exemptions or subsection 73.3(1) of the Securities Act (Ontario), and are “permitted clients”, as defined in National Instrument 31 103 Registration Requirements, Exemptions and Ongoing Registrant Obligations. Any resale of the securities must be made in accordance with an exemption from, or in a transaction not subject to, the prospectus requirements of applicable securities laws.
Securities legislation in certain provinces or territories of Canada may provide a purchaser with remedies for rescission or damages if this prospectus supplement (including any amendment thereto) contains a misrepresentation, provided that the remedies for rescission or damages are exercised by the purchaser within the time limit prescribed by the securities legislation of the purchaser’s province or territory. The purchaser should refer to any applicable provisions of the securities legislation of the purchaser’s province or territory for particulars of these rights or consult with a legal advisor.
Pursuant to section 3A.3 of National Instrument 33 105 Underwriting Conflicts (NI 33 105), the Underwriter is not required to comply with the disclosure requirements of NI 33-105 regarding conflicts of interest in connection with this offering.
Notice to Canadian investors: Maxim is not registered as a dealer in Canada and is relying upon the international dealer exemption in Alberta, British Columbia, Nova Scotia, Ontario and Québec as permitted under National Instrument 31-103. Maxim is located in the United States, all its assets are situated outside Canada and, as a result, there may be difficulty enforcing any legal rights against Maxim.
Cayman Islands. No invitation, whether directly or indirectly, may be made to the public in the Cayman Islands to subscribe for our securities.
European Union (excluding Austria). This document has not been, and will not be, registered with or approved by any securities regulator in the European Union. Accordingly, this document may not be made available, nor may the securities be offered for sale, in the European Union except in circumstances that do not require a prospectus under Article 1(4) of Regulation (EU) 2017/1129 of the European Parliament and the Council of the European Union (the “Prospectus Regulation”).
In accordance with Article 1(4)(a) of the Prospectus Regulation, an offer of securities in the European Union is limited to persons who are “qualified investors” (as defined in Article 2(e) of the Prospectus Regulation).
Hong Kong. The contents of this prospectus have not been reviewed by any regulatory authority in Hong Kong. You are advised to exercise caution in relation to the offer. If you are in any doubt about any of the contents of this prospectus, you should obtain independent professional advice. Please note that (i) the ADSs may not be offered or sold in Hong Kong, by means of this prospectus or any document other than to “professional investors” within the meaning of Part I of Schedule 1 of the Securities and Futures Ordinance (Cap.571, Laws of Hong Kong) (SFO) and any rules made thereunder, or in other circumstances which do not result in the document being a “prospectus” within the meaning of the Companies Ordinance (Cap.32, Laws of Hong Kong) (CO) or which do not constitute an offer or invitation to the public for the purpose of the CO or the SFO, and (ii) no advertisement, invitation or document relating to the ADSs may be issued or may be in the possession of any person for the purpose of issue (in each case whether in Hong Kong or elsewhere) which is directed at, or the contents of which are likely to be accessed or read by, the public in Hong Kong (except if permitted to do so under the securities laws of Hong Kong) other than with respect to the ADSs which are or are intended to be disposed of only to persons outside Hong Kong or only to “professional investors” within the meaning of the SFO and any rules made thereunder.
Israel. This document does not constitute a prospectus under the Israeli Securities Law, 5728-1968, or the Securities Law, and has not been filed with or approved by the Israel Securities Authority. In the State of Israel, this document is being distributed only to, and is directed only at, and any offer of the ADSs is directed only at, investors listed in the first addendum, or the Addendum, to the Israeli Securities Law, consisting primarily of joint investment in trust funds, provident funds, insurance companies, banks, portfolio managers, investment advisors, members of the Tel Aviv Stock Exchange, underwriters, venture capital funds, entities with equity in excess of NIS 50 million and “qualified individuals”, each as defined in the Addendum (as it may be amended from time to time), collectively referred to as qualified investors (in each case purchasing for their own account or, where permitted under the Addendum, for the accounts of their clients who are investors listed in the Addendum). Qualified investors will be required to submit written confirmation that they fall within the scope of the Addendum, are aware of the meaning of same and agree to it.
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The People’s Republic of China. This prospectus may not be circulated or distributed in the PRC and the ADSs may not be offered or sold, and will not offer or sell to any person for re-offering or resale directly or indirectly to any resident of the PRC except pursuant to applicable laws, rules and regulations of the PRC. For the purpose of this paragraph only, the PRC does not include Taiwan and the special administrative regions of Hong Kong and Macau.
Switzerland. The securities may not be publicly offered in Switzerland and will not be listed on the SIX Swiss Exchange (the SIX) or on any other stock exchange or regulated trading facility in Switzerland. This document has been prepared without regard to the disclosure standards for issuance prospectuses under art. 652a or art. 1156 of the Swiss Code of Obligations or the disclosure standards for listing prospectuses under art. 27 ff. of the SIX Listing Rules or the listing rules of any other stock exchange or regulated trading facility in Switzerland. Neither this document nor any other offering or marketing material relating to the securities or the offering may be publicly distributed or otherwise made publicly available in Switzerland.
Neither this document nor any other offering or marketing material relating to the offering, or the securities have been or will be filed with or approved by any Swiss regulatory authority. In particular, this document will not be filed with, and the offer of securities will not be supervised by, the Swiss Financial Market Supervisory Authority FINMA, and the offer of securities has not been and will not be authorized under the Swiss Federal Act on Collective Investment Schemes (CISA). Accordingly, no public distribution, offering or advertising, as defined in CISA, its implementing ordinances and notices, and no distribution to any non-qualified investor, as defined in CISA, its implementing ordinances and notices, shall be undertaken in or from Switzerland, and the investor protection afforded to acquirers of interests in collective investment schemes under CISA does not extend to acquirers of securities.
Taiwan. The securities have not been and will not be registered with the Financial Supervisory Commission of Taiwan pursuant to relevant securities laws and regulations and may not be sold, issued or offered within Taiwan through a public offering or in circumstances which constitutes an offer within the meaning of the Securities and Exchange Act of Taiwan that requires a registration or approval of the Financial Supervisory Commission of Taiwan. No person or entity in Taiwan has been authorized to offer, sell, give advice regarding or otherwise intermediate the offering and sale of the securities in Taiwan.
United Kingdom. This document has not been delivered for approval to the Financial Conduct Authority in the United Kingdom and no prospectus (within the meaning of Regulation 21 of The Public Offers and Admissions to Trading Regulations 2024 (“POATRs”)) has been published or is required to be published in respect of the securities.
This document is issued on a confidential basis to “qualified investors” (within the meaning of paragraph 2 of Schedule 1 to the POATRs) in the United Kingdom. The securities may not be offered or sold in the United Kingdom by means of this document or any other document except pursuant to an exemption from the general prohibition on offers of relevant securities to the public in the United Kingdom. This document should not be distributed, published or reproduced, in whole or in part, nor may its contents be disclosed by recipients to any other person in the United Kingdom.
Any invitation or inducement to engage in investment activity (within the meaning of section 21 of the Financial Services and Markets Act 2000, as amended (“FSMA”)) received in connection with the offer or sale of the securities has been, and only will be, communicated or caused to be communicated in the United Kingdom in circumstances in which section 21(1) of the FSMA does not apply to the Company.
In the United Kingdom, this document is being distributed only to, and is directed at, persons (i) who have professional experience in matters relating to investments falling within Article 19(5) (investment professionals) of the Financial Services and Markets Act 2000 (Financial Promotions) Order 2005 (“FPO”), (ii) who fall within the categories of persons referred to in Article 49(2)(a) to (d) (high net worth companies, unincorporated associations, etc.) of the FPO or (iii) to whom it may otherwise be lawfully communicated (“relevant persons”). The investment to which this document relates is available only to relevant persons. Any person who is not a relevant person should not act or rely on this document.
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Expenses Relating to the Offering
The following table sets forth the costs and expenses, other than underwriting discounts and commissions, payable in connection with the sale of ADSs and Warrants in the offering. All amounts are estimated except the SEC registration fee, the Financial Industry Regulatory Authority, Inc., or FINRA, filing fee and the Nasdaq initial listing fee. Except as otherwise noted, all the expenses below will be paid by us.
| Expense | Amount | |||
| SEC registration fee | US$ | 1,140 | ||
| Nasdaq initial listing fee | 50,000 | |||
| Legal fees and expenses | 400,000 | |||
| Accounting fees and expenses | 250,000 | |||
| Printing expenses | 10,000 | |||
| Warrant agent fees | 20,000 | |||
| Miscellaneous fees and expenses, including FINRA filing fee | 38,860 | |||
| Total | US$ | 770,000 | ||
The validity of the ordinary shares represented by the ADSs and ordinary shares underlying the Warrants to be issued in this offering and certain other matters of Australian law will be passed upon for us by Rimôn Law Pty Ltd. The validity of the Warrants and certain other matters as to U.S. federal law and New York state law will be passed upon for us by Rimôn. Legal counsel to the underwriter in connection with this offering are Ellenoff Grossman & Schole LLP, with respect to U.S. federal law and Lander & Rogers, with respect to Australian law.
The consolidated financial statements of Chilwa Minerals Limited (the “Company”) as of June 30, 2024 and 2025 and for each of the two years in the period ended June 30, 2025 included in this Prospectus and in the Registration Statement have been so included in reliance on the reports of BDO Audit Pty Ltd, an independent registered public accounting firm, given on the authority of said firm as experts in auditing and accounting. The report on the consolidated financial statements contains an explanatory paragraph regarding the Company’s ability to continue as a going concern.
The offices of BDO Audit Pty Ltd are located at Level 18, 360 Queen Street, Brisbane City QLD 4000.
Enforcement of Civil Liabilities
We are a public limited company incorporated under the laws of Australia. Certain of our directors are non-residents of the United States and substantially all their assets are located outside the United States. As a result, it may not be possible or practicable for you to:
| ● | effect service of process within the United States upon our non-U.S. resident directors or on us; |
| ● | enforce in U.S. courts judgments obtained against our non-U.S. resident directors or us in the United States courts in any action, including actions under the civil liability provisions of U.S. securities laws; |
| ● | enforce in U.S. courts judgments obtained against our non-U.S. resident directors or us in courts of jurisdictions outside the United States in any action, including actions under the civil liability provisions of U.S. securities laws; or |
| ● | bring an original action in an Australian court to enforce liabilities against our non-U.S. resident directors or us based solely upon U.S. securities laws. |
You may also have difficulties enforcing in courts outside the United States judgments that are obtained in U.S. courts against any of our non-U.S. resident directors or us, including actions under the civil liability provisions of the U.S. securities laws.
With that noted, there are no treaties between Australia and the United States that would affect the recognition or enforcement of foreign judgments in Australia. We also note that investors may be able to bring an original action in an Australian court against us to enforce liabilities based in part upon U.S. federal securities laws. The disclosure in this section is not based on the opinion of counsel.
We have appointed Corporation Service Company as our agent to receive service of process with respect to any action brought against us under the federal securities laws of the United States.
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Where You Can Find More Information
We have filed with the SEC a Registration Statement on Form F-1 under the Securities Act with respect to the ADSs and Warrants offered in this prospectus. A related registration statement on Form F-6 has been filed with the SEC to register the ADSs. This prospectus, which forms a part of the Registration Statement, does not contain all of the information included in the Registration Statement. Certain information is omitted and you should refer to the Registration Statement and its exhibits for that information. With respect to references made in this prospectus to any contract or other document of Chilwa, such references are not necessarily complete and you should refer to the exhibits attached to the Registration Statement for copies of the actual contract or document.
Upon the closing of this offering, we will become subject to periodic reporting and other informational requirements of the Exchange Act as applicable to foreign private issuers. Accordingly, we will be required to file reports, including annual reports on Form 20-F, periodic reports and other information, with the SEC.
We are allowed four months after the end of our fiscal year to file our annual report with the SEC, and we are not required to disclose certain detailed information regarding executive compensation that is required from U.S. domestic issuers. Also, as a foreign private issuer, we are exempt from the rules of the Exchange Act prescribing the furnishing of proxy statements to shareholders, and the members of our board of directors, our senior management and our principal shareholders are exempt from the reporting and short-swing profit recovery provisions contained in Section 16 of the Exchange Act.
The SEC maintains a website at www.sec.gov that contains reports, proxy and information statements and other information regarding registrants that file electronically with the SEC. You also can inspect our registration statement, as well as any other information we file with or furnish to the SEC, on this website. This reference to the SEC’s website is an inactive textual reference only and is not a hyperlink.
We expect to make our annual reports and other information filed with or furnished to the SEC available, free of charge, through our website at www.chilwaminerals.com.au as soon as reasonably practicable after those reports and other information are filed with or furnished to the SEC. The information contained on, or that can be accessed through, our website is not part of, and is not incorporated into, this prospectus.
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CHILWA MINERALS LIMITED
INDEX TO CONSOLIDATED FINANCIAL STATEMENTS
| Page | ||
| Consolidated Financial Statements for the years ended June 30, 2025 and 2024 | ||
| Report of Independent Registered Public Accounting Firm (BDO Audit Pty Ltd – PCAOB ID 22566) | F-2 | |
| Consolidated Statements of Comprehensive Income/(Loss) | F-3 | |
| Consolidated Statements of Financial Position | F-4 | |
| Consolidated Statements of Changes In Equity | F-5 | |
| Consolidated Statements of Cash Flows | F-6 | |
| Notes to the Consolidated Financial Statements | F-7 |
| Page | ||
| Consolidated Interim Unaudited Financial Statements for the six months ended December 31, 2025 and 2024 | ||
| Statement of Profit and Loss and Other Comprehensive Income | F-33 | |
| Statement of Financial Position | F-34 | |
| Statement of Changes in Equity | F-35 | |
| Statement of Cash Flows | F-36 | |
| Notes to the Financial Statements | F-37 |
F-1
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
Shareholders and Board of Directors
Chilwa Minerals Limited
West Perth, Australia, Western Australia
Opinion on Consolidated Financial Statements
We have audited the accompanying consolidated statements of financial position of Chilwa Minerals Limited (the Company) as of June 30, 2025 and 2024, the related consolidated statements of profit or loss and other comprehensive income (loss), consolidated statement of changes in equity, and consolidated cash flows for each of the years then ended, and the related notes (collectively referred to as the ‘consolidated financial statements’). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of June 30, 2025 and 2024, and the results of its operations and its cash flows for the years then ended, in conformity with International Financial Reporting Standards (‘IFRS’) as issued by the International Accounting Standards Board.
Substantial doubt about the Company’s ability to continue as a Going Concern
The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. As described in Note 2 to the consolidated financial statements, the Company has suffered recurring losses from operations and has recurring net cash outflows from operating and investing activities that raise substantial doubt about its ability to continue as a going concern. Management’s evaluation of the events and conditions and management’s plans regarding these matters are also described in Note 2. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty. Our opinion is not modified with respect to this matter.
Basis for opinion
These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s consolidated financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (‘PCAOB’) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion.
Our audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audits provide a reasonable basis for our opinion.
We have served as the Company’s auditor since 2025.
| BDO Audit Pty Ltd | |
| /s/ BDO Audit Pty Ltd | |
| Brisbane, Australia | |
| March 12, 2026 |
F-2
Consolidated
Statement of Profit or Loss and Other Comprehensive Income
For the years ended June 30, 2025 and 2024
(Expressed in Australian Dollars (“AUD”))
| 2025 | 2024 | |||||||||
| Notes | AUD | AUD | ||||||||
| REVENUE AND OTHER INCOME | ||||||||||
| Other Income | 7 | 125,991 | 202,811 | |||||||
| EXPENDITURE | ||||||||||
| Employee benefits expense | (915,366 | ) | (755,300 | ) | ||||||
| Consultancy and professional fees | (500,844 | ) | (89,777 | ) | ||||||
| Administrative expenses | 9 | (495,606 | ) | (319,067 | ) | |||||
| Share-based payments expense | 23 | (948,505 | ) | (389,741 | ) | |||||
| Compliance and regulatory costs | (533,782 | ) | (435,116 | ) | ||||||
| Depreciation expense | 14,15 | (94,983 | ) | (28,419 | ) | |||||
| LOSS BEFORE INCOME TAX | (3,363,095 | ) | (1,814,609 | ) | ||||||
| Income tax expense/(benefit) | 10 | - | - | |||||||
| LOSS FOR THE YEAR ATTRIBUTABLE TO OWNERS OF CHILWA MINERALS LIMITED | (3,363,095 | ) | (1,814,609 | ) | ||||||
| OTHER COMPREHENSIVE INCOME/(LOSS) | ||||||||||
| Items that may be reclassified subsequently to profit or loss | ||||||||||
| Exchange differences arising on translation of foreign operations | (75,936 | ) | 2,345 | |||||||
| TOTAL COMPREHENSIVE LOSS FOR THE YEAR ATTRIBUTABLE TO OWNERS OF CHILWA MINERALS LIMITED | (3,439,031 | ) | (1,812,264 | ) | ||||||
| LOSS PER SHARE FOR THE YEAR ATTRIBUTABLE TO THE ORDINARY EQUITY HOLDERS OF THE COMPANY | ||||||||||
| Basic and diluted Loss per Share (cents per share) | 22 | (4.63 | ) | (2.71 | ) | |||||
The above Consolidated Statement of Profit or Loss and Other Comprehensive Income should be read in conjunction with the accompanying notes.
F-3
Consolidated
Statement of Financial Position
As at June 30, 2025 and 2024
(Expressed in Australian Dollars (“AUD”))
| 2025 | 2024 | |||||||||
| Notes | AUD | AUD | ||||||||
| ASSETS | ||||||||||
| Cash and cash equivalents | 11 | 687,022 | 4,151,472 | |||||||
| Trade and other receivables | 12 | 77,584 | 2,153 | |||||||
| Prepayments | 13 | 64,085 | 48,916 | |||||||
| CURRENT ASSETS | 828,691 | 4,202,541 | ||||||||
| Prepayments | 13 | 679,832 | - | |||||||
| Property, plant and equipment | 14 | 376,467 | 67,356 | |||||||
| Right-of-use assets | 15 | 67,711 | 74,160 | |||||||
| Exploration and evaluation assets | 16 | 18,598,678 | 11,333,988 | |||||||
| NON- CURRENT ASSETS | 19,722,688 | 11,475,504 | ||||||||
| TOTAL ASSETS | 20,551,379 | 15,678,045 | ||||||||
| LIABILITIES | ||||||||||
| Trade and other payables | 17 | 2,717,809 | 2,405,775 | |||||||
| Employee benefit obligations | 56,291 | 26,636 | ||||||||
| Lease liabilities | 18 | 65,652 | 71,052 | |||||||
| Borrowings | - | 43,304 | ||||||||
| CURRENT LIABILITIES | 2,839,752 | 2,546,767 | ||||||||
| TOTAL LIABILITIES | 2,839,752 | 2,546,767 | ||||||||
| EQUITY | ||||||||||
| Share Capital | 19 | 18,986,249 | 11,863,857 | |||||||
| Reserves | 20 | 5,367,568 | 4,546,516 | |||||||
| Accumulated losses | (6,642,190 | ) | (3,279,095 | ) | ||||||
| TOTAL EQUITY | 17,711,627 | 13,131,278 | ||||||||
| TOTAL EQUITY AND LIABILITIES | 20,551,379 | 15,678,045 | ||||||||
The above Consolidated Statement of Financial Position should be read in conjunction with the Notes to the Consolidated Financial Statements.
F-4
Consolidated
Statement of Changes in Equity
For the years ended June 30, 2025 and 2024
(Expressed in Australian Dollars (“AUD”))
| Share Capital | Share-based
Payments Reserve | Translation
Reserve | Accumulated
Losses | Total Equity | ||||||||||||||||||
| Notes | AUD | AUD | AUD | AUD | AUD | |||||||||||||||||
| BALANCE AT JULY 1, 2023 | 755,001 | 95,330 | - | (1,464,486 | ) | (614,155 | ) | |||||||||||||||
| Total Comprehensive Income | ||||||||||||||||||||||
| Loss for the year | - | - | - | (1,814,609 | ) | (1,814,609 | ) | |||||||||||||||
| Exchange differences on translation of foreign operations | - | - | 2,345 | - | 2,345 | |||||||||||||||||
| TOTAL COMPREHENSIVE LOSS | - | - | 2,345 | (1,814,609 | ) | (1,812,264 | ) | |||||||||||||||
| Transactions with Owners of the Company | ||||||||||||||||||||||
| Issue of ordinary shares | 19 | 11,800,000 | - | - | - | 11,800,000 | ||||||||||||||||
| Share issue transaction costs | 19 | (691,144 | ) | 309,100 | - | - | (382,044 | ) | ||||||||||||||
| Equity-settled share-based payment | 23 | - | 4,139,741 | - | - | 4,139,741 | ||||||||||||||||
| Total Transactions with Owners of the Company | 11,108,856 | 4,448,841 | - | - | 15,557,697 | |||||||||||||||||
| BALANCE AT JUNE 30, 2024 | 11,863,857 | 4,544,171 | 2,345 | (3,279,095 | ) | 13,131,278 | ||||||||||||||||
| BALANCE AT JULY 1, 2024 | 11,863,857 | 4,544,171 | 2,345 | (3,279,095 | ) | 13,131,278 | ||||||||||||||||
| Total Comprehensive Income | ||||||||||||||||||||||
| Loss for the year | - | - | - | (3,363,095 | ) | (3,363,095 | ) | |||||||||||||||
| Other Comprehensive Loss | ||||||||||||||||||||||
| Exchange differences on translation of foreign operations | - | - | (75,936 | ) | - | (75,936 | ) | |||||||||||||||
| TOTAL COMPREHENSIVE LOSS | - | - | (75,936 | ) | (3,363,095 | ) | (3,439,031 | ) | ||||||||||||||
| Transactions with Owners of the Company | ||||||||||||||||||||||
| Issue of ordinary shares | 19 | 7,094,611 | - | - | - | 7,094,611 | ||||||||||||||||
| Options conversion to shares | 19 | 51,517 | (51,517 | ) | - | - | - | |||||||||||||||
| Share issue transaction costs | 19 | (23,736 | ) | - | - | (23,736 | ) | |||||||||||||||
| Equity-settled share-based payment | 23 | - | 948,505 | - | - | 948,505 | ||||||||||||||||
| Total Transactions with Owners of the Company | 7,122,392 | 896,988 | - | - | 8,019,380 | |||||||||||||||||
| BALANCE AT JUNE 30, 2025 | 18,986,249 | 5,441,159 | (73,591 | ) | (6,642,190 | ) | 17,711,627 | |||||||||||||||
The above Consolidated Statement of Changes in Equity should be read in conjunction with the Notes to the Consolidated Financial Statements
F-5
Consolidated
Statement of Cash Flows
For the years ended June 30, 2025 and 2024
(Expressed in Australian Dollars (“AUD”))
| 2025 | 2024 | |||||||||
| Notes | AUD | AUD | ||||||||
| CASH FLOWS FROM OPERATING ACTIVITIES | ||||||||||
| Payments to suppliers and employees | (2,175,208 | ) | (1,956,056 | ) | ||||||
| Interest received | 125,991 | 202,811 | ||||||||
| NET CASH OUTFLOW FROM OPERATING ACTIVITIES | 24 | (2,049,217 | ) | (1,753,245 | ) | |||||
| CASH FLOWS FROM INVESTING ACTIVITIES | ||||||||||
| Payments for exploration and evaluation expenditure | 16 | (7,981,261 | ) | (1,697,772 | ) | |||||
| Payments for plant and equipment | 14 | (397,795 | ) | (84,795 | ) | |||||
| Cash acquired on acquisition of subsidiaries | - | 74,165 | ||||||||
| NET CASH OUTFLOW FROM INVESTING ACTIVITIES | (8,379,056 | ) | (1,708,402 | ) | ||||||
| CASH FLOWS FROM FINANCING ACTIVITIES | ||||||||||
| Proceeds from issue of share capital | 7,094,611 | - | ||||||||
| Payments for share issue transaction costs | (23,736 | ) | (447,044 | ) | ||||||
| Proceeds from future share issue | 31,424 | - | ||||||||
| Proceeds from borrowings | - | 43,304 | ||||||||
| Repayment of borrowings | (43,304 | ) | - | |||||||
| NET CASH (OUTFLOW)/INFLOW FROM FINANCING ACTIVITIES | 7,058,995 | (403,740 | ) | |||||||
| NET (DECREASE)/INCREASE IN CASH AND CASH EQUIVALENTS | (3,369,278 | ) | (3,865,387 | ) | ||||||
| Cash and cash equivalents at the beginning of the financial year | 4,151,472 | 8,022,417 | ||||||||
| Effects of exchange rate changes on cash and cash equivalents | (95,172 | ) | (5,558 | ) | ||||||
| CASH AND CASH EQUIVALENTS AT JUNE 30 | 24 | 687,022 | 4,151,472 | |||||||
The above Consolidated Statement of Cash Flows should be read in conjunction with the Notes to the Consolidated Financial Statements.
F-6
Notes to the Consolidated Financial Statements
| 1. | REPORTING ENTITY |
Chilwa Minerals Limited (the Company) is a for-profit company limited by shares, incorporated and domiciled in Australia. The registered office of the Company is located at Level 28, 140 St George’s Terrace, Perth, Western Australia. Its ordinary shares are listed on the Australian Securities Exchange (ASX) under the symbol “CHW”. The consolidated financial statements comprise the Company and its subsidiaries (together referred to as the Group).
The principal activities of the Group during the reporting period were mineral exploration of the Chilwa Heavy Mineral Sands Project (Project) in Malawi.
| 2. | BASIS OF PREPARATION |
The consolidated financial statements are general purpose financial statements, which have been prepared in accordance with International Financial Reporting Standards (IFRS) as issued by the International Accounting Standards Board (IASB). The consolidated financial statements have been prepared under the historical cost convention, except for business acquisitions and share-based payments, which have been measured at fair value.
The consolidated financial statements are presented in Australian Dollars (AUD), which is the Company’s presentation currency. All amounts have been rounded to the nearest dollar.
Material accounting policies adopted in the preparation of these financial statements are presented in the notes accompanying the consolidated financial statements and have been consistently applied across all periods presented. In the current period there were no changes in the accounting policies from the policies applied in the previous reporting period.
New Accounting Standard and Amendments Issued Not Yet Mandatory
New and amended IFRS standards have been issued but are not yet mandatory for the financial year ending June 30, 2025. The Group has not early adopted any of these pronouncements. The Group will apply each standard on its mandatory effective date.
The following table lists the new and amended accounting standards and their effective dates:
| Effective date | New Accounting Standards or Amendments | Impact | ||
| January 1, 2027 | IFRS 18 – Presentation and Disclosure in Financial Statements | This Standard sets out requirements for the presentation and disclosure of information in general purpose financial statements to help ensure they provide relevant information that faithfully represents an entity’s assets, liabilities, equity, income and expenses. The Company is working through the impact of the new standard. | ||
| January 1, 2026 | Amendments to IFRS 7 / IFRS 9 – Classification and Measurement of Financial Instruments | The amendments clarify when a financial instrument is derecognised and new disclosure requirements. The Company is working through the impact of the new standard. |
F-7
| 2. | BASIS OF PREPARATION (Cont’d) |
Going Concern
The consolidated financial statements have been prepared on the going concern basis, which contemplates the continuity of normal business activity and the realisation of assets and the settlement of liabilities in the ordinary course of business.
At June 30, 2025, the Group had cash on hand of AUD 687,022 (2024: AUD 4,151,472) and net current liabilities of AUD 2,011,061. The Group made an operating loss before tax for the financial year ended June 30, 2025 of AUD 3,363,095 (2024: AUD 1,814,609) and had a cash outflow from operating activities and investing activities of AUD 10,428,273 (2024: AUD 3,461,647).
On August 8, 2025, Chilwa Minerals Limited raised AUD 4.1 million through a private placement, issuing 3,544,922 fully paid ordinary shares to its existing shareholders and sophisticated investors.
From October 2025 to January 2026, the Group raised AUD 8 million through another private placement, issuing 6,687,860 fully paid ordinary shares. The funds from both placements were for working capital and to accelerate the Group’s exploration activities at the Chilwa Critical Minerals Project in Malawi.
At the date of signing these financial statements the Group has cash on hand of AUD 3,947,158.
The Group has performed a monthly cash flow forecast through to the period ending June 30, 2027, based on the best cost estimates available. In order to progress the Group’s planned objective of exploration at the Chilwa Project, further funding in the form of debt and/or equity raising will be required. These events give rise to a material uncertainty relating to going concern that may cast significant doubt on the Company’s ability to continue as a going concern to realise its assets and discharge its liabilities in the normal course of business. The directors are of the opinion that there are reasonable grounds to believe that the Group will be able to continue as a going concern for the following reasons:
| ● | The Group has a history of successful capital raising; and |
| ● | The Group has the ability to adjust expenditure and operational plans and will only commit to expenditure when there is appropriate funding in place; |
Should the Group be unable to continue as a going concern it may be required to realise its assets and extinguish its liabilities other than in the normal course of business and at amounts different to those stated in the financial statements. The financial statements do not include any adjustments relating to the recoverability and classification of asset carrying amounts or to the amount and classification of liabilities that might result should the Group be unable to continue as a going concern and meet its debts as and when they fall due.
| 3. | USE OF JUDGEMENT AND ESTIMATES |
The preparation of these consolidated financial statements required management to make judgements, estimates and assumptions that affect the application of polices and reported amounts of assets and liabilities, and expenses. These estimates and associated assumptions are based on historical experience and various factors that are believed to be reasonable under the circumstances, the results of which form the basis of making judgments about the carrying values if assets and liabilities that are not readily apparent from other sources. These estimates and judgements are disclosed within each relevant note.
F-8
| 4. | FAIR VALUE MEASUREMENT |
Some Group’s accounting policies and disclosures require the measurement of fair values, both financial and non-financial assets, and financial and non-financial liabilities. When measuring the fair value of an asset or a liability, The Group uses observable market data as far as possible. Fair values are categorised into different levels in fair value hierarchy based on the inputs used in the valuation techniques as follows:
| ● | Level 1: quoted prices (unadjusted) in active markets for identical assets and liabilities. |
| ● | Level 2: inputs other than quoted prices included in Level 1 that are observable for eth asset or liability, either directly or indirectly. |
| ● | Level 3: inputs for the assts or liability that are not based on observable market data, |
If the inputs used to measure the fair value of an asset or a liability fall into different levels of the fair hierarchy, then the fair value measurement is categorised in its entirety in the same level of the fair value hierarchy as the lowest input that is significant to the entire measurement.
Further information about the assumptions made in measuring fair values is included in the notes: share-based payments, acquisition of subsidiaries, and financial risk management.
| 5. | PRINCIPLES OF CONSOLIDATION |
Subsidiaries
The Group financial statements consolidate those of the Company and its subsidiaries. The financial statements of subsidiaries are included in the consolidated financial statements from the date on which control commences until
the date on which control ceases. The Company controls a subsidiary if it is exposed or has rights to variable returns from its involvement within the entity and has the ability to affect those returns through its power over the entity.
Profit or loss and other comprehensive income of subsidiaries acquired or disposed during the period are recognised from the effective date of acquisition, or up to the effective date of disposal, as applicable. The financial statements of the subsidiaries are prepared for the same reporting period as the Company, using consistent accounting policies. Accounting policies of subsidiaries have been changed where necessary to ensure consistency with the policies adopted by the Company.
All transactions and balances between Group companies are eliminated on consolidation, including unrealised gains and losses on transactions between Group companies. Amounts reported in the financial statements of subsidiaries have been adjusted where necessary to ensure consistency with the accounting policies adopted by the Group.
Functional currency
Items included in the financial statements of each of the Group’s entities are measured using the currency of the primary economic environment in which the individual entity operates (the functional currency).
Foreign transactions and balances
Foreign currency transactions are translated into functional currency using the exchange rates prevailing at the date of the transaction. Foreign currency monetary items are translated at the reporting date exchange rate. Non-monetary items measured at historical cost continue to be carried at the exchange rate at the date of the transaction. Non-monetary items measured at fair value are reported at the exchange rate at the date when fair values were determined.
F-9
| 5. | PRINCIPLES OF CONSOLIDATION (Cont’d) |
Exchange differences arising on the translation of monetary items are recognised in profit or loss, except where deferred in equity as a qualifying cash flow or net investment hedge. Exchange differences arising on the translation of non-monetary items are recognised directly in equity to the extent that the gain or loss is directly recognised in equity, otherwise the exchange difference is recognised in profit or loss.
Foreign operations
The financial results and position of foreign operations whose functional currency is different from the Group’s presentation currency are translated as follows:
| ● | assets and liabilities are translated at year-end exchange rates prevailing at that reporting date; |
| ● | income and expenses are translated at average exchange rates for the period; and |
| ● | retained earnings are translated at the exchange rates prevailing at the date of the transaction. |
Exchange differences arising on translation of foreign operations are transferred directly to the Group’s foreign currency translation reserve in equity. These differences are recognised in profit or loss in the period in which the operation is disposed.
| 6. | SEGMENT INFORMATION |
An operating segment is a component of the Group that engages in business activities from which it may earn revenues and incur expenses (including revenues and expenses relating to transactions with other components of the same entity), whose operating results are regularly reviewed by the Group’s chief operating decision maker to make decisions about resources to be allocated to the segment and assess its performance and for which discrete financial information is available. This includes exploration activities which are yet to earn revenue. Management will also consider other factors in determining operating segments such as the existence of a line manager and the level of segment information presented to the board of directors.
Management has identified that the Group operates in one segment, being the mining exploration sector in Malawi. In determining operating segments, the Group has had regard to the information and reports the Managing Director uses to make strategic decisions regarding resources. The Managing Director is considered to be the chief operating decision maker and is empowered by the board of directors to allocate resources and assess the performance of the Group. The Group operates in two geographical areas, being Malawi and Australia, with Australia being where the corporate head office is located.
The total of non-current assets other than financial assets, broken down by location of the assets, is as follows:
| 2025 | 2024 | |||||||
| AUD | AUD | |||||||
| Australia (Corporate) | 84,916 | 128,893 | ||||||
| Malawi | 19,637,772 | 11,346,611 | ||||||
| 19,722,688 | 11,475,504 | |||||||
F-10
| 7. | OTHER INCOME |
| 2025 | 2024 | |||||||
| AUD | AUD | |||||||
| Interest received from financial institutions | 125,991 | 202,811 | ||||||
| 125,991 | 202,811 | |||||||
| 8. | SPECIFIC EXPENSES |
| 2025 | 2024 | |||||||
| Specific expenses requiring disclosure | AUD | AUD | ||||||
| Superannuation contribution expense | (58,856 | ) | (45,040 | ) | ||||
| 9. | ADMINISTRATIVE EXPENSES |
| 2025 | 2024 | |||||||
| AUD | AUD | |||||||
| Travel expenses | (232,870 | ) | (175,793 | ) | ||||
| IT and communication | (91,859 | ) | (55,133 | ) | ||||
| Insurance expense | (54,109 | ) | (61,579 | ) | ||||
| Marketing expense | (7,730 | ) | (11,487 | ) | ||||
| Office overhead expenses | (13,866 | ) | (9,517 | ) | ||||
| Net foreign exchange loss | (95,172 | ) | (5,558 | ) | ||||
| (495,606 | ) | (319,067 | ) | |||||
| 10. | INCOME TAX |
The current income tax for the period is defined as the amount of income taxes payable (recoverable) in respect of the taxable profit (tax loss) for the current accounting period. It also incorporates adjustments to changes in deferred tax assets and liabilities attributable to temporary differences between the tax bases of assets and liabilities and their carrying amounts in the financial statements, and to unused tax losses
Deferred tax assets and liabilities are recognised for temporary differences at the tax rates expected to apply when the assets are recovered, or liabilities are settled. No deferred tax asset or liability is recognised in relation to these temporary differences if they arose on goodwill or in a transaction, other than a business combination, that at the time of the transaction did not affect either accounting profit or taxable profit or loss. Deferred tax assets are recognised for deductible temporary differences and unused tax losses only if it is probable that future taxable amounts will be available to utilise those temporary differences and losses.
The carrying amount of deferred income tax assets is reviewed at each reporting date and reduced to the extent that it is no longer probable that sufficient taxable profit will be available to allow all or part of the deferred income tax assets to be utilized.
F-11
| 10. | INCOME TAX (cont’d) |
Deferred tax assets and deferred tax liabilities are offset only if a legally enforceable right exists to set off current tax assets against tax liabilities, and the deferred tax liabilities relate to the same taxable entity and the same taxation authority.
| 2025 | 2024 | |||||||
| AUD | AUD | |||||||
| (a) Income tax benefit | ||||||||
| Current tax | - | - | ||||||
| Deferred tax | - | - | ||||||
| - | - | |||||||
| (b) Numerical reconciliation of income tax expense to prima facie tax payable | ||||||||
| Loss from continuing operations before income tax expense | (3,363,095 | ) | (1,814,609 | ) | ||||
| Prima facie tax benefit at the Australian tax rate of 25% (2023: 25%) | (840,774 | ) | (453,652 | ) | ||||
| Tax effect of amounts which are not deductible (taxable) in calculating taxable income: | ||||||||
| Share-based payments | 237,126 | 97,435 | ||||||
| Other | 80,358 | 93,834 | ||||||
| (523,290 | ) | (262,383 | ) | |||||
| Movements in unrecognised temporary differences | 5,229 | (19,306 | ) | |||||
| Tax effect of current year tax losses for which no deferred tax asset has been recognised | 518,061 | 281,689 | ||||||
| Income tax expense/benefit | - | - | ||||||
| 2025 | 2024 | |||||||
| AUD | AUD | |||||||
| (c) Unrecognised temporary differences | ||||||||
| Deferred Tax Assets (at 25% (2024: 25%)) | ||||||||
| Section 40-880 costs | 61,129 | 82,713 | ||||||
| Other temporary differences | 25,877 | 17,507 | ||||||
| Carry forward tax losses | 967,731 | 417,656 | ||||||
| 1,054,737 | 517,876 | |||||||
| Deferred Tax Liabilities (at 25% (2024: 25%)) | ||||||||
| Unrealised foreign exchange gains | 16,007 | 945 | ||||||
| Net deferred tax assets | 1,038,730 | 516,931 | ||||||
Net deferred tax assets not been brought to account as it is not probable within the immediate future that tax profits will be available against which deductible temporary differences and tax losses can be utilised. The recoupment of available tax losses as at June 30, 2025 is contingent upon the following:
| (i) | The Group deriving future assessable income of a nature and an amount sufficient to enable the benefit from the deductions for the losses to be realised; | |
| (ii) | The Group continues to comply with the conditions for deductibility imposed by tax legislation in Australia; and | |
| (iii) | There being no changes in tax legislation which adversely affect the Group from realising the benefit. |
F-12
| 11. | CASH AND CASH EQUIVALENTS |
Cash and cash equivalents include cash on hand, deposits held at call with banks, other highly liquid short-term investments with original maturities of 3 months or less, and bank overdrafts.
| 2025 | 2024 | |||||||
| AUD | AUD | |||||||
| Cash at bank and on hand | 687,022 | 4,151,472 | ||||||
| Cash and cash equivalents as shown in the statement of financial position and the statement of cash flows | 687,022 | 4,151,472 | ||||||
Cash at bank earns interest at floating rates based on daily bank deposit rates.
| 12. | TRADE AND OTHER RECEIVABLES |
Trade and other receivables are recognised initially at fair value and subsequently measured at amortised cost using the effective interest method, less allowance for expected credit losses, applying the simplified approach. As most receivables are short term in nature, their carrying amount is assumed to be the same as their fair value.
Trade and other receivables are generally due for settlement within 12 months and therefore are all classified as current. The Estimated Credit Loss has been determined to be 0.5% for both periods and immaterial to the Group.
| 2025 | 2024 | |||||||
| AUD | AUD | |||||||
| Other receivables | 29,105 | - | ||||||
| GST refund | 48,479 | 2,153 | ||||||
| 77,584 | 2,153 | |||||||
| 13. | PREPAYMENTS |
Prepayments are recognised when payments are made and are amortised on a systematic basis over the period in which the related goods or services are received.
Current prepayments comprise advance payments for geological software subscriptions and insurance premiums.
Non-current prepayments relate to the cost of a drill rig purchased for use under the drilling contract. Under the agreement with Mota Engil, the drill rig is made exclusively available to Mota Engil for use solely in connection with the Chilwa drilling contract. Mota Engil will reduce its drilling service invoices by 30% until the full cost of the drill rig has been amortised. Upon completion of the drilling contract, ownership of the drill rig will transfer to Mota Engil.
As at 30 June 2025, total drill rig costs incurred amounted to AUD 717,536, of which AUD 37,704 had been amortised.
F-13
| 13. | PREPAYMENTS (Cont’d) |
| 2025 | 2024 | |||||||
| AUD | AUD | |||||||
| Current | ||||||||
| Prepaid Software Subscription | 55,800 | - | ||||||
| Prepaid Insurance | 8,285 | 48,916 | ||||||
| 64,085 | ||||||||
| Non-current | ||||||||
| Prepaid Drilling | 679,832 | - | ||||||
| 679,832 | - | |||||||
| 743,917 | 48,916 | |||||||
| 14. | PROPERTY, PLANT AND EQUIPMENT |
Items of property, plant and equipment are measured at cost, which includes capitalised borrowing costs. After initial recognition, property plant and equipment are carried at cost less accumulated depreciation and accumulated impairment losses. Depreciation is recognised on a straight-line basis over the estimated useful life of each asset, with plant and equipment estimated useful life between 3 – 7 years and computer equipment estimated useful life between 3-7 years. Depreciation is charged from the date the asset is brought into use.
Property plant and equipment is assessed for impairment at each reporting date. An asset is impaired when its carrying amount exceeds its recoverable amount, where recoverable amount is the higher of fair value less costs of disposal, and value in use. Any gain or loss on disposal of an item of property, plant and equipment is recognised in profit or loss.
| Plant and Equipment | Computer Equipment | Total | ||||||||||
| AUD | AUD | AUD | ||||||||||
| At June 30, 2025 | ||||||||||||
| Cost | 449,585 | 44,234 | 493,819 | |||||||||
| Accumulated depreciation | (97,834 | ) | (19,518 | ) | (117,352 | ) | ||||||
| Net book amount | 351,751 | 24,716 | 376,467 | |||||||||
| Year ended June 30, 2025 | ||||||||||||
| Opening net book amount on July 1, 2024 | 59,490 | 7,866 | 67,356 | |||||||||
| Additions | 369,055 | 28,740 | 397,795 | |||||||||
| Depreciation | (76,644 | ) | (11,890 | ) | (88,534 | ) | ||||||
| Exchange differences | (150 | ) | - | (150 | ) | |||||||
| Closing net book amount | 351,751 | 24,716 | 376,467 | |||||||||
F-14
| 14. | PROPERTY, PLANT AND EQUIPMENT (Cont’d) |
| Plant and
Equipment | Computer Equipment | Total | ||||||||||
| AUD | AUD | AUD | ||||||||||
| At June 30, 2024 | ||||||||||||
| Cost | 80,681 | 15,494 | 96,175 | |||||||||
| Accumulated depreciation | (21,191 | ) | (7,628 | ) | (28,819 | ) | ||||||
| Net book amount | 59,490 | 7,866 | 67,356 | |||||||||
| Year ended June 30, 2024 | ||||||||||||
| Opening net book amount on July 1, 2023 | - | 7,924 | 7,924 | |||||||||
| Additions | 80,681 | 4,114 | 84,795 | |||||||||
| Depreciation | (21,023 | ) | (4,172 | ) | (25,195 | ) | ||||||
| Exchange differences | (168 | ) | - | (168 | ) | |||||||
| Closing net book amount | 59,490 | 7,866 | 67,356 | |||||||||
| 15. | RIGHT-OF-USE ASSETS |
The assets represent the Group’s right to use underlying leased property and equipment during the lease term. The right-of-use of asset is initially measured at cost and is subsequently depreciated under the straight-line method from the commencement date of the lease term.
| 2025 | 2024 | |||||||
| At June 30 | AUD | AUD | ||||||
| Cost | 77,384 | 77,384 | ||||||
| Accumulated depreciation | (9,673 | ) | (3,224 | ) | ||||
| Net book amount | 67,711 | 74,160 | ||||||
| 2025 | 2024 | |||||||
| At June 30 | AUD | AUD | ||||||
| Opening net book amount | 74,160 | - | ||||||
| Additions | - | 77,384 | ||||||
| Depreciation | (6,449 | ) | (3,224 | ) | ||||
| Closing net book amount | 67,711 | 74,160 | ||||||
| 16. | EXPLORATION AND EVALUATION ASSETS |
Exploration and evaluation expenditure encompasses expenditures incurred by the Group in connection with the exploration for and evaluation of mineral resources before the technical feasibility and commercial viability of extracting a mineral resource are demonstrable. For each area of interest, expenditure incurred in the acquisition of rights to explore is capitalised and recognised as an exploration and evaluation asset. Exploration and evaluation costs are carried forward where right of tenure of the area of interest is current and they are expected to be recouped through sale or successful development and exploitation of the area of interest, or, where exploration and evaluation activities in the area of interest have not yet reached a stage that permits reasonable assessment of the existence of economically recoverable reserves.
F-15
| 16. | EXPLORATION AND EVALUATION ASSETS (Cont’d) |
Exploration and evaluation expenditure are measured at cost at its recognition, and those exploration and evaluation assets acquired in the business combination are recognised at the cost of acquisition and accumulated separately by area of interest. No amortisation is recognised while operations are in the exploration and evaluation phase.
At the end of each reporting period the exploration and evaluation expenditure shall be assessed for impairment. Exploration and evaluation expenditure are assessed for impairment when facts and circumstances suggest that the carrying amount of an exploration and evaluation asset may exceed its recoverable amount.
The exploration and evaluation asset shall no longer be classified as such when the technical feasibility and commercial viability of extracting a mineral resource are demonstrable or where mineral reserves have been identified. Before reclassification into the mine development asset, exploration and evaluation assets shall be assessed for impairment, and any impairment loss recognised within profit or loss.
Critical accounting judgement
The future recoverability of capitalised exploration and evaluation expenditure is dependent on a number of factors, including whether the Group decides to exploit the related lease itself or, if not, whether it successfully recovers the related exploration and evaluation asset through sale.
Factors that could impact the future recoverability include the level of reserves and resources, future technological changes, costs of drilling and production, production rates, future legal changes (including changes to environmental restoration obligations) and changes to commodity prices.
The carrying value of the Group’s projects was reviewed, and no impairment indicators were identified during the 2025 and 2024 financial years in relation to the Group’s tenements.
| 2025 | 2024 | |||||||||
| Notes | AUD | AUD | ||||||||
| Exploration and evaluation assets | 18,598,678 | 11,333,988 | ||||||||
| Balance at the beginning of the year | 11,333,988 | - | ||||||||
| Asset acquisition of Chilwa Project | - | 7,475,835 | ||||||||
| Expenditure incurred | 7,264,690 | 3,858,153 | ||||||||
| Impairment of exploration and evaluation | - | - | ||||||||
| Balance at the end of the year | 18,598,678 | 11,333,988 | ||||||||
ASSET ACQUISITION OF THE CHILWA PROJECT
Asset acquisition
On July 1, 2023, Chilwa Minerals Limited (CHW) acquired 100% interest in the Chilwa Heavy Mineral Sands Project (Chilwa Project) pursuant to the Share Sale Agreement (SSA) dated 4 April 2023 and varied by the Deed of Variation of 21 June 2023. The SSA was signed between CHW, Luso Global Mining BV (Luso) and Mota-Engil Investments (Malawi) Limited (MEIML) pursuant to which, CHW acquired 100% of the issued capital of Chilwa Minerals Africa Limited (CMA), who in turn holds 100% of the issued capital of MEIML. Under SSA on completion of the transaction, the consideration in the form of the equity instruments, being 19,000,000 fully paid ordinary shares and 18,750,000 performance rights, were issued by CHW to Luso.
F-16
| 16. | EXPLORATION AND EVALUATION ASSETS (Cont’d) |
As a result of the transaction, CMA and MEIML became subsidiaries of the CHW from the date of completion, with MEIML being, at that time, the 100% owner of granted exploration licenses EL0670/22 and EL0671/22, together with all associated geological information on the Chilwa Project. Subsequent to the acquisition date, the tenements have been transferred from MEIML to CMA.
Based on the successful application of the concentration test, and the absence of substantive processes, the acquisition of the Chilwa Project does not constitute a business combination, and the transaction is therefore accounted for as an asset acquisition.
The following summarises the components of the purchase consideration issued by CHW to Luso for the acquisition of CMA and the fair value of the equity instruments consideration:
| AUD | ||||
| Ordinary shares issued (1) | 3,800,000 | |||
| Performance rights issued (2) | 3,750,000 | |||
| Total purchase consideration | 7,550,000 | |||
The fair values of the assets and liabilities of CMA as at the date of acquisition are as follows:
| AUD | ||||
| Cash and cash equivalents | 74,165 | |||
| Exploration and evaluation assets | 7,475,835 | |||
| Net identifiable assets acquired | 7,550,000 | |||
| 1 | The fair value of shares is based on the grant date fair value of the equity instruments. This was determined by reference to the IPO price of the CHW share of AUD 0.20 for 19,000,000 shares issued to Luso. |
| 2 | The IPO price of AUD 0.20 has been determined as the grant date fair value, being the price shares were issued to the general market at the same time. The total value of the performance rights is measured at AUD 3,750,000. The performance rights were issued with the following non-market vesting conditions: |
| ● | Class A: 7,500,000 rights, expiring on June 30, 2025, vest on announcement of a JORC compliant Indicated Resources of 3 million tonnes THM from the Chilwa Project. |
| ● | Class B: 3,750,000 rights, expiring on June 30, 2027, vest on announcement of a PFS (as defined in the JORC Code) that recommends further proceeding with the Chilwa Project. |
| ● | Class C: 3,750,000 rights, expiring on June 30, 2027, vest on announcement of the completion of a feasibility study (as defined in the JORC Code) that recommends further proceeding with the Chilwa Project. |
| ● | Class D: 3,750,000 rights, expiring June 30, 2028, vest on announcement that a decision to mine the Chilwa Project has been made. |
(b) Critical accounting estimates and judgements
Accounting for this transaction has required management to exercise a high degree of judgement over the following areas:
Asset acquisition not constituting a business
In determining when an acquisition is an asset acquisition and not a business combination, the Group used significant judgement to assess that the assets acquired did not constitute a business in accordance with IFRS 3. Under IFRS 3 a business is an integrated set of activities and assets that consists of inputs and processes, which when applied to those inputs has the ability to create outputs. Management determined that the purchase of CMA under the SSA was an asset acquisition.
F-17
| 16. | EXPLORATION AND EVALUATION ASSETS (Cont’d) |
Fair value at acquisition
On initial recognition, the assets and liabilities of CMA were included in the statement of financial position at their fair values. In measuring fair value of exploration projects, management considered generally accepted technical valuation methodologies and comparable transactions in determining the fair value. Due to the subjective nature of valuation with respect to exploration projects with limited exploration results, management have determined the price paid to be indicative of the fair value of the exploration and evaluation assets acquired.
| 17. | TRADE AND OTHER PAYABLES |
These amounts represent liabilities for goods and services provided to the Group prior to the end of the financial period which are unpaid. The amounts are unsecured and are usually paid within 60 days of recognition. Trade and other payables are presented as current liabilities unless payment is not due within 12 months from the reporting date. The carrying amounts of trade and other payables are considered to represent their fair values, due to their short-term nature.
| 2025 | 2024 | |||||||
| AUD | AUD | |||||||
| Trade and other payables | 480,847 | 467,042 | ||||||
| Accrued and other expenses | 2,236,962 | 1,938,733 | ||||||
| 2,717,809 | 2,405,775 | |||||||
| 18. | LEASE LIABILITIES |
At commencement date of the contract, the Group assesses whether a contract is, or contains, a lease. The contract contains lease or a lease component if it conveys the right to control the use of an identifiable asset for a period in exchange for consideration. At the commencement date, the lease liability is measured at the present value of future lease payments, discounted using the appropriate rate. The discount rate shall be either the interest rate implicit in the lease or the incremental borrowing rate.
At each reporting date, after initial recognition, the lease liability is measured at amortised costs using the effective interest method, and is adjusted for lease payments, interest charges, reassessments, and lease modifications. This ensures that the carrying amount reflects the evolving economic obligation under the lease.
| 2025 | 2024 | |||||||
| At June 30 | AUD | AUD | ||||||
| Balance at the beginning of the year | 71,052 | 76,302 | ||||||
| Interest accretion | 1,800 | 1,750 | ||||||
| Transferred to accounts payable | (7,200 | ) | (7,000 | ) | ||||
| Balance at the end of the year | 65,652 | 71,052 | ||||||
In 2024 the Group entered into a 10-year lease agreement with Mota-Engil Engenharia e Construção África, S.A (lessor) for the use of a storage shed. Although the lessor has yet to bill lease charges, the Group has recognised a lease liability in accordance with the terms of the agreement and its obligation under the lease contract and transferred any non-invoiced amounts into accounts payable/accruals. The full amount has been classified as a current liability as the payment will be due upon receipt of the lessor’s invoice. The lessor has confirmed that no amounts beyond the contractual lease payment will be sought from the Company for the use of the shed. The Group will continue to monitor the arrangement for any changes that may affect the measurement or classification of the lease liability.
F-18
| 19. | CONTRIBUTED EQUITY |
Contributed equity represents the amount paid by shareholders for issued shares of the Company. The Company has one class of ordinary shares, which carry equal rights to dividends and voting. The Company has issued equity instruments including share options and performance rights. When options are exercised or performance rights vest, the carrying amount in the share-based payment reserve is transferred to contributed equity.
| 2025 | 2024 | |||||||||||||||
| Number of shares | AUD | Number of shares | AUD | |||||||||||||
| (a) Share capital | ||||||||||||||||
| Ordinary shares fully paid | 75,765,468 | 18,986,249 | 67,200,001 | 11,863,857 | ||||||||||||
| Total contributed equity | 75,765,468 | 18,986,249 | 67,200,001 | 11,863,857 | ||||||||||||
| (b) Movements in ordinary share capital | ||||||||||||||||
| Beginning of the financial year | 67,200,001 | 11,863,857 | 8,200,001 | 755,001 | ||||||||||||
| Issued during the year: | ||||||||||||||||
| Options exercised at AUD 0.25 on 07/29/2024 | 166,667 | 41,667 | - | - | ||||||||||||
| Options exercised at AUD 0.30 on 07/29/2024 | 166,667 | 50,000 | - | - | ||||||||||||
| Options exercised at AUD 0.40 on 07/29/2024 | 166,666 | 66,667 | - | - | ||||||||||||
| Conversion of options to shares on 07/29/2024 – fair value transfer | - | 51,517 | - | - | ||||||||||||
| Placement tranche 1 - AUD 0.86 per share on 10/22/2024 | 5,426,616 | 4,666,878 | - | - | ||||||||||||
| Placement tranche 2 - AUD 0.86 per share on 01/07/2025 | 2,638,851 | 2,269,399 | - | - | ||||||||||||
| Issued as consideration for acquisition of Chilwa Project on 07/03/2023 | - | - | 19,000,000 | 3,800,000 | ||||||||||||
| Issued for cash at Initial Public Offer at AUD 0.20 on 07/03/2023 | - | - | 40,000,000 | 8,000,000 | ||||||||||||
| Transaction costs | - | (23,736 | ) | - | (691,144 | ) | ||||||||||
| End of the financial year | 75,765,468 | 18,986,249 | 67,200,001 | 11,863,857 | ||||||||||||
| (c) Movements in options on issue | ||||||||
| Number of options | ||||||||
| 2025 | 2024 | |||||||
| Balance at the beginning of the financial year | 3,000,000 | - | ||||||
| Options vested and exercised at AUD 0.25 on 07/29/2024 | (166,667 | ) | - | |||||
| Options vested and exercised at AUD 0.30 on 07/29/2024 | (166,667 | ) | - | |||||
| Options vested and exercised at AUD 0.40 on 07/29/2024 | (166,666 | ) | - | |||||
| Issued, unlisted, exercisable at AUD 0.25 on or before 06/30/ 2027 | - | 1,000,000 | ||||||
| Issued, unlisted, exercisable at AUD 0.30 on or before 06/30/ 2027 | - | 1,000,000 | ||||||
| Issued, unlisted, exercisable at AUD 0.40 on or before 06/30/ 2027 | - | 1,000,000 | ||||||
| Balance at the end of the financial year | 2,500,000 | 3,000,000 | ||||||
F-19
| 19. | CONTRIBUTED EQUITY (Cont’d) |
(d) Movements in performance rights on issue
| Number of performance rights | ||||||||
| 2025 | 2024 | |||||||
| Balance at the beginning of the financial year | 25,000,000 | - | ||||||
| Issued on 11/30/2024, unlisted, expiring 11/30/2028 | 3,750,000 | |||||||
| Issued, Class A expiring 06/30/2025 | - | 10,000,000 | ||||||
| Issued, Class B expiring 06/30/ 2027 | - | 5,000,000 | ||||||
| Issued, Class C expiring 06/30/2027 | - | 5,000,000 | ||||||
| Issued, Class D expiring 06/30/ 2028 | - | 5,000,000 | ||||||
| Balance at the end of the financial year | 28,750,000 | 25,000,000 | ||||||
(e) Ordinary shares
Ordinary shares entitle the holder to participate in dividends and the proceeds on the winding up of the Company in proportion to the number of and amounts paid on the shares held. The fully paid ordinary shares have no par value and the Company does not have a limited amount of authorised capital. On a show of hands every member present, at a meeting of shareholders, in person or by proxy shall have one vote and upon a poll each share shall have one vote.
(f) Capital risk management
The Group’s objectives when managing capital are to safeguard their ability to continue as a going concern, so that they may continue to provide returns for shareholders and benefits for other stakeholders.
Due to the nature of the Group’s activities, being mineral exploration, the Group does not have ready access to credit facilities, with the primary source of funding being equity raisings. Therefore, the focus of the Group’s capital risk management is the current working capital position against the requirements of the Group to meet exploration programmes and corporate overheads. The Group’s strategy is to ensure appropriate liquidity is maintained to meet anticipated operating requirements, with a view to initiating appropriate capital raisings as required. The working capital position of the Group at June 30,2025 and June 30, 2024 are as follows:
| 2025 | 2024 | |||||||
| AUD | AUD | |||||||
| Cash and cash equivalents | 687,022 | 4,151,472 | ||||||
| Trade and other receivables | 77,584 | 2,153 | ||||||
| Prepayments | 743,917 | 48,916 | ||||||
| Trade and other payables | (2,717,809 | ) | (2,405,775 | ) | ||||
| Lease liabilities | (65,652 | ) | (71,052 | ) | ||||
| Employee benefit obligations | (56,291 | ) | (26,636 | ) | ||||
| Borrowings | - | (43,304 | ) | |||||
| Working capital position | (1,331,229 | ) | 1,655,774 | |||||
On August 7, 2025, the Company raised AUD 4.1 million on issue of 3,544,922 fully paid ordinary shares at an issue price of AUD 1.05 per share.
F-20
| 20. | RESERVES |
| 2025 | 2024 | |||||||
| AUD | AUD | |||||||
| Share based payment reserve | 5,441,159 | 4,544,171 | ||||||
| Foreign currency translation reserve | (73,591 | ) | 2,345 | |||||
| 5,367,568 | 4,546,516 | |||||||
Nature and purpose of reserves
| (i) | Foreign currency translation reserve |
The translation reserve comprises all foreign currency differences arising from the translation of the financial statements of foreign operations, as well as the effective portion of any foreign currency differences arising from a net investment in foreign operation. The cumulative amount is reclassified to profit or loss when the net investment is disposed of.
| (ii) | Share-based payments reserve |
The share-based payments reserve is used to recognise the fair value of options and performance rights granted by the Company.
| 21. | DIVIDENDS |
No dividends were paid during the 2024 or 2025 financial years. No recommendation for payment of dividends has been made post period end.
| 22. | LOSS PER SHARE |
The calculation of basic Loss per Share is based on the following loss attributable to ordinary shareholders and weighted average number of ordinary shares outstanding:
| Cents | Cents | |||||||
| (a) Basic and diluted loss per share | ||||||||
| Basic and diluted loss per share attributable to the ordinary equity holders of the Company | (4.63 | ) | (2.71 | ) | ||||
| AUD | AUD | |||||||
| (b) Loss used in calculating loss per share | ||||||||
| Loss attributable to the owners of the Company used in calculating basic and diluted loss per share | (3,363,095 | ) | (1,814,609 | ) | ||||
| Number
of shares | Number
of shares | |||||||
| (c) Weighted average number of shares used as the denominator | ||||||||
| Weighted average number of ordinary shares used as the denominator in calculating basic and diluted loss per share | 72,591,494 | 67,038,799 | ||||||
(d) Information on the classification of options and performance rights
As the Group made a loss for the year ended June 30, 2025 and June 30, 2024, the options and performance rights on issue were considered anti-dilutive and were not included in the calculation of diluted earnings per share. The options and performance rights currently on issue could potentially dilute basic earnings per share in the future.
F-21
| 23. | SHARE BASED PAYMENTS |
Equity-settled share-based payments are provided to officers, employees, consultants and other advisors. These share-based payments are measured at the fair value of the equity instrument at the grant date.
Fair value is determined using the Black Scholes option pricing model for the equity instruments with market-based conditions. The share-based payment expense is recognised over the vesting period irrespective of whether the market condition is ultimately satisfied, provided all other service and non-market conditions are met.
Equity-settled awards with non-market-based conditions are valued at the grant date using a fair-value measurement that excludes the impact of those conditions, with vesting outcomes assessed separately through expected-vesting estimates. The fair value is expensed on a straight-line basis over the vesting period, based on the Group’s estimate of equity instruments that will eventually vest. At each reporting date, the Group revises its estimate of the number of equity instruments expected to vest. The impact of the revision of the original estimates, if any, is recognised in profit or loss over the remaining vesting period, with a corresponding adjustment to the share-based payments reserve.
| (a) | Options |
During the 2024 and 2025 years, no unlisted options were granted to the employees and directors. Options granted in 2024 carry no dividend or voting rights. When exercisable, each option is convertible into one ordinary share in the capital of the Company with full dividend and voting rights.
Fair value of options granted to the IPO lead manager in 2024.
The price was calculated by using the Black-Scholes European Option Pricing Model applying the following inputs:
| 2025 | 2024 | |||||||
| Weighted average exercise price (cents) | - | 31.7 | ||||||
| Weighted average life of the option (years) | - | 4.0 | ||||||
| Weighted average underlying share price (cents) | - | 20.0 | ||||||
| Expected share price volatility | - | 80.0 | % | |||||
| Risk free interest rate | - | 3.97 | % | |||||
Set out below is a summary of the share-based payment options granted:
| 2025 | 2024 | |||||||||||||||
| Number
of options | Weighted
average exercise price cents | Number
of options | Weighted
average exercise price cents | |||||||||||||
| Outstanding at the beginning of the year | 3,000,000 | 31.7 | - | - | ||||||||||||
| Granted | - | - | 3,000,000 | 31.7 | ||||||||||||
| Forfeited | - | - | - | - | ||||||||||||
| Exercised | (500,000 | ) | 31.7 | - | - | |||||||||||
| Expired | - | - | - | - | ||||||||||||
| Outstanding at year-end | 2,500,000 | 31.7 | 3,000,000 | 31.7 | ||||||||||||
| Exercisable at year-end | 2,500,000 | 31.7 | 3,000,000 | 31.7 | ||||||||||||
The weighted average remaining contractual life of share options outstanding at the end of the financial year was 3 years (2024: 4), with exercise prices ranging from AUD 0.25 to AUD 0.40.
F-22
| 23. | SHARE BASED PAYMENTS (Cont’d) |
The following assumptions were used to determine the value of the unlisted options using the Black-Sholes European Option Pricing Model:
| Total | ||||||||||||||||
| Number of Options at the beginning of the year | 1,000,000 | 1,000,000 | 1,000,000 | 3,000,000 | ||||||||||||
| Exercised | (166,667 | ) | (166,667 | ) | (166,666 | ) | (500,000 | ) | ||||||||
| Number of Options at year-end | 833,333 | 8333,333 | 833,334 | 2,500,000 | ||||||||||||
| Valuation date | 07/01/2023 | 07/01/2023 | 07/01/2023 | |||||||||||||
| Grant date | 04/05/2023 | 04/05/2023 | 04/05/2023 | |||||||||||||
| Expiry date | 06/30/2027 | 06/30/2027 | 06/30/2027 | |||||||||||||
| Vesting date | 07/01/2023 | 07/01/2023 | 07/01/2023 | |||||||||||||
| Fair value at grant date, AUD per option | 0.1125 | 0.1046 | 0.0920 | |||||||||||||
| Exercise price, AUD per option | 0.25 | 0.30 | 0.40 | |||||||||||||
| Underlying share price at grant date | 0.20 | 0.20 | 0.20 | |||||||||||||
| Risk-free rate | 3.97 | % | 3.97 | % | 3.97 | % | ||||||||||
| Volatility | 80 | % | 80 | % | 80 | % | ||||||||||
| Dividend rate | nil | nil | nil | |||||||||||||
| (b) | Performance rights |
During the 2025 financial year, 3,750,000 performance rights (Class E) were issued to directors with the fair value of AUD 544,791 expensed as share-based payments in the profit or loss for the current period. The fair value of the performance rights is valued on the grant date and based on underlying ordinary share price of AUD 0.83 per share. The fair value of AUD 403,714 relating to current period vesting of performance rights issued in the prior year was expensed as share-based payments in profit and loss.
In April, 2023, performance rights were issued to directors and consultants (total of 6,250,000 with fair value of AUD 485,070 expensed as share-based payments in the profit or loss for 2023 and 2024) and Luso Global Mining BV (a total of 18,750,000 as part consideration for the acquisition of the Chilwa Project with fair value of AUD 3,750,000 recognised as exploration and evaluation assets in the statement of financial position in 2024). The fair value of the performance rights is based on the fair value of the underlying ordinary shares determined by reference to the IPO price of AUD 0.20 per share.
The performance rights will vest upon satisfaction of the respective performance conditions at any time before the applicable expiry date, as detailed below:
| Class | Performance Condition | |
| Class A | Announcement of a JORC compliant Indicated Resources of 3 million tonnes THM from the Chilwa Project on or before June 30, 2025. | |
| Class B | Announcement of a PFS (as defined in the JORC Code) that recommends further proceeding with the Chilwa Project on or before June 30, 2027. | |
| Class C | Announcement of the completion of a feasibility study (as defined in the JORC Code) that recommends further proceeding with the Chilwa Project on or before June 30, 2027. | |
| Class D | Announcement that a decision to mine the Chilwa Project has been made on or before June 30, 2028. | |
| Class E | Approval and issue of a Mining Licence for Chilwa Critical Minerals Project by November 30, 2028. |
F-23
| 23. | SHARE BASED PAYMENTS (Cont’d) |
Set out below is a summary of the share-based payment performance rights granted:
| 2025 | 2024 | |||||||
| Number
of performance rights | Number
of performance rights | |||||||
| Outstanding at the beginning of the year | 25,000,000 | - | ||||||
| Granted | 3,750,000 | 25,000,000 | ||||||
| Forfeited | - | - | ||||||
| Exercised | - | - | ||||||
| Expired | - | - | ||||||
| Outstanding at year-end | 28,750,000 | 25,000,000 | ||||||
| Total | ||||||||||||||||||||||||
| Number of performance rights | 10,000,000 | 5,000,000 | 5,000,000 | 5,000,000 | 3,750,000 | 28,750,000 | ||||||||||||||||||
| Class | A | B | C | D | E | |||||||||||||||||||
| Grant date | 04/05/2023 | 04/05/2023 | 04/05/2023 | 04/05/2023 | 10/09/2024 | |||||||||||||||||||
| Valuation date | 07/01/2023 | 07/01/2023 | 07/01/2023 | 07/01/2023 | 11/07/2024 | |||||||||||||||||||
| Expiry date | 06/30/2025 | 06/30/2027 | 06/30/2027 | 06/30/2028 | 11/30/2028 | |||||||||||||||||||
| Vesting date (1) | 06/30/2025 | 06/30/2027 | 06/30/2027 | 06/30/2028 | 11/30/2028 | |||||||||||||||||||
| Underlying share price at grant date | 0.20 | 0.20 | 0.20 | 0.20 | 0.83 | |||||||||||||||||||
| Fair value per performance right | 0.20 | 0.20 | 0.20 | 0.20 | 0.83 | |||||||||||||||||||
| Probability of performance condition (1) | 100 | % | 100 | % | 100 | % | 100 | % | 100 | % | ||||||||||||||
| Exercise price, AUD | nil | nil | nil | nil | nil | |||||||||||||||||||
| (1) | Refer to section (b) above for vesting performance conditions. At June 30, 2025 and June 30, 2024, the Directors determined the probability of meeting each non-market related performance condition. |
| (c) | Shares |
During the 2025 financial year, no shares were issued to employees or third parties as a consideration for provision of services.
On July 1, 2023, the Company issued 19,000,000 fully paid ordinary shares to Luso Global Mining BV in accordance with the Share Sale Agreement as part consideration for the acquisition of the Chilwa Project. The fair value of the shares recognised is based on the fair value of the equity instruments determined by reference to the IPO price of AUD 0.20 per share and totalled to AUD 3,800,000. This amount was recognised in the statement of financial position as exploration and evaluation assets.
| (d) | Share-based payment transactions |
Share-based payment transactions recognised during the period were as follows:
| 2025 | 2024 | |||||||
| AUD | AUD | |||||||
| Performance rights issued to employee and contractors (‘share-based payments expense’) | 948,505 | 389,741 | ||||||
| Performance rights issued as part consideration for acquisition of Chilwa Project (‘exploration and evaluation assets’) | - | 3,750,000 | ||||||
| Options issued to lead manager of the IPO (‘share issue transaction costs’) | - | 309,100 | ||||||
| Shares issued as part consideration for acquisition of Chilwa Project (‘exploration and evaluation assets’) | - | 3,800,000 | ||||||
| 948,505 | 8,248,841 | |||||||
F-24
| 24. | RECONCILIATION OF CASH FLOWS FROM OPERATING ACTIVITIES |
The reconciliation of loss to net cash outflows from operating activities outlines the key non-cash adjustments and movements in working capital that link reported loss with operating cash movement, supporting the Group’s underlying cash-flow performance.
| 2025 | 2024 | |||||||
| AUD | AUD | |||||||
| (a) Reconciliation of net loss after income tax to net cash outflow from operating activities | ||||||||
| Net loss for the year | (3,363,095 | ) | (1,814,609 | ) | ||||
| Non-Cash Items | ||||||||
| Share-based payment expense | 948,505 | 389,741 | ||||||
| Depreciation expense | 94,983 | 28,419 | ||||||
| Net exchange differences | 95,172 | 6,098 | ||||||
| Change in operating assets and liabilities | ||||||||
| Decrease/(increase) in trade and other receivables | (90,601 | ) | 166,091 | |||||
| (Decrease)/increase in trade and other payables | 236,164 | (555,621 | ) | |||||
| Increase in employee benefit obligations | 29,655 | 26,636 | ||||||
| Net cash outflow from operating activities | (2,049,217 | ) | (1,753,245 | ) | ||||
| 25. | FINANCIAL RISK MANAGEMENT |
The board of directors has overall responsibility for establishment and oversight of the Group’s risk management framework. The Managing Director, with the assistance of advisors as required, identifies, analyses and monitors the risks faced by the Group and reports to the board on risk management.
The Group’s activities expose it to a variety of financial risks: market risk (including currency risk and interest rate risk), credit risk and liquidity risk. The Group’s overall risk management program focuses on the unpredictability of financial markets and seeks to minimise potential adverse effects on the financial performance of the Group. Given the nature and size of the business operations the Group does not enter into derivative transactions to mitigate the financial risks. This note presents information about the Group’s exposure to each of the above risks, its objectives and processes for measuring and managing risk, and the management of capital.
| (a) | Market risk |
| (i) | Foreign exchange risk |
Foreign currency risk is the risk that the fair value of future cash outflows of an exposure will fluctuate because of changes in foreign currency exchange rates.
The Group undertakes certain transactions denominated in foreign currency and is exposed to foreign currency risk through foreign exchange rate fluctuations. Foreign exchange risk arises from future commercial transactions and recognised financial assets and financial liabilities denominated in a currency that is not the Group’s functional currency. The risk is measured using sensitivity analysis and cash flow forecasting.
F-25
| 25. | FINANCIAL RISK MANAGEMENT (Cont’d) |
The carrying amount of the Group’s foreign currency denominated financial assets and financial liabilities at the reporting dates were as follows:
| 2025 | 2024 | |||||||
| AUD | AUD | |||||||
| Assets | ||||||||
| Malawi Kwacha | 16,931 | 47,946 | ||||||
| 16,931 | 47,946 | |||||||
| Liabilities | ||||||||
| South African Rand | 933 | - | ||||||
| Malawi Kwacha | 363,628 | 187,502 | ||||||
| Great British Pound | 216,376 | 13,824 | ||||||
| US Dollars | 220,254 | 317,875 | ||||||
| Euros | 1,607,705 | 1,596,518 | ||||||
| 2,408,896 | 2,115,719 | |||||||
| Net liability | 2,391,965 | 2,067,773 | ||||||
The Group had net liabilities denominated in foreign currencies of AUD 2,391,965 at June 30, 2025 and AUD 2,067,773 at June 30, 2024. Based on this exposure, had the Australian dollar weakened by 10% or strengthened by 10% against these foreign currencies with all other variables held constant, the Company’s loss before tax for the years would have been AUD 265,774 higher/AUD 265,774 lower for June 30, 2025 and AUD 206,777 higher/AUD 206,777 lower for June 30, 2024.
The Group has assessed the application of IAS 29 Financial Reporting in Hyperinflation Economies in relation to its subsidiaries in Malawi. The functional currency of these subsidiaries has been determined to be the United Stated dollar, based on the currency that most reasonably represents the economic effects of its underlying transactions. Since these entities do not have material exposure to the Malawian kwacha and its functional currency is United States Dollars, the hyperinflation accounting is not applicable for the periods.
| (ii) | Commodity price risk |
Given the current level of operations the Group is not exposed to commodity price risk.
(iii) Interest rate risk
The Group’s exposure to the risk of changes in market interest rates relates primarily to the cash and short-term deposits on hand with a floating interest rate. The Group policy is to monitor the interest rate yield curve out to 120 days to ensure a balance is maintained between the liquidity of cash assets and the interest rate return. The proportional mix of floating interest rates and fixed rates to a maximum of six months fluctuate during the years depending on current working capital requirements. The weighted average interest rate received on cash and cash equivalents by the Company was 3.3% for June 30, 2025 and 3.6% for June 30, 2024.
Sensitivity analysis
At June 30, 2025, if interest rates had changed by +/- 100 basis points from the weighted average rate for the year with all other variables held constant, post-tax loss for the Group would have been AUD 38,402 lower/higher. At June 30, 2024, if interest rates had changed by +/- 100 basis points from the weighted average rate for the year with all other variables held constant, post-tax loss for the Group would have been AUD 55,734 lower/higher.
F-26
| 25. | FINANCIAL RISK MANAGEMENT (Cont’d) |
| (b) | Credit risk |
Credit risk is the risk of financial loss to the Group if a customer or counterparty to a financial instrument fails to meet its contractual obligations. This arises principally from cash and cash equivalents and receivables.
The maximum exposure to credit risk at the reporting dates is the carrying amount (net of provision for impairment) of those assets as disclosed in the statement of financial position and notes to the financial statements. The only significant concentration of credit risk for the Group is the cash and cash equivalents held with financial institutions. All material deposits at June 30, 2025 and June 30, 2024 are held with the major Australian banks for which the Board evaluate credit risk to be minimal (credit rating AA-).
As the Group does not presently have any significant trade receivables, lending, significant stock levels or any other credit risk, a formal credit risk management policy is not maintained.
| (c) | Liquidity risk |
Liquidity risk is the risk that the Group will not be able to meet its financial obligations as they fall due. The Group manages liquidity risk by continuously monitoring forecast and actual cash flows and ensuring sufficient cash is available to meet the current and future commitments of the Group. Due to the nature of the Group’s activities, being mineral exploration, the Group does not have ready access to credit facilities, with the primary source of funding being equity raisings. The Board of Directors constantly monitor the state of equity markets in conjunction with the Group’s current and future funding requirements, with a view to initiating appropriate capital raisings as required.
The financial liabilities of the Group are confined to trade and other payables as disclosed in the consolidated statement of financial position. All trade and other payables are non-interest bearing and due within 12 months of the reporting date.
The table below reflects an undiscounted contractual maturity analysis for financial liabilities. The timing of cash flows presented in the table to settle financial liabilities reflects the earliest contractual settlement dates.
| Within 6 Months | 6 to 12 Months | Total Contractual Cashflow | ||||||||||||||||||||||
| 2025 | 2024 | 2025 | 2024 | 2025 | 2024 | |||||||||||||||||||
| AUD | AUD | AUD | AUD | AUD | AUD | |||||||||||||||||||
| Financial liabilities due for payment | ||||||||||||||||||||||||
| Trade and other payables | 2,717,809 | 2,405,775 | - | - | 2,717,809 | 2,405,775 | ||||||||||||||||||
| Borrowings | - | - | - | 43,304 | - | 43,304 | ||||||||||||||||||
| Lease liabilities | 65,652 | 71,052 | - | - | 65,652 | 71,052 | ||||||||||||||||||
| Total contractual outflows | 2,783,461 | 2,476,827 | - | 43,304 | 2,783,461 | 2,520,131 | ||||||||||||||||||
| (d) | Fair value estimation |
The fair values of the Group’s financial instruments are estimated using valuation techniques appropriate to the nature of each instrument. Where quoted prices in active markets are available, instruments are measured using observable market inputs; otherwise, fair value is determined using valuation models that incorporate discounted cash flows, yield curves, credit-risk adjustments and other relevant assumptions.
There were no financial assets or liabilities at June 30, 2025 and June 30, 2024 requiring fair value estimation and disclosure as they are short-term financial assets and financial liabilities whereas their carrying values approximate fair value.
F-27
| 25. | FINANCIAL RISK MANAGEMENT (Cont’d) |
The carrying amounts and estimated fair values of financial assets and financial liabilities are as follows:
| 2025 | 2024 | |||||||
| AUD | AUD | |||||||
| Financial Assets | ||||||||
| Cash and cash equivalents | 687,022 | 4,151,472 | ||||||
| Total Financial Assets | 687,022 | 4,151,472 | ||||||
| Financial Liabilities | ||||||||
| Trade and other payables | 2,717,809 | 2,405,775 | ||||||
| Borrowings | - | 43,304 | ||||||
| Lease liabilities | 65,652 | 71,052 | ||||||
| Total Financial Liabilities | 2,783,461 | 2,520,131 | ||||||
| 26. | REMUNERATION OF AUDITORS |
During the year the following fees were paid or payable for services provided by the auditor of the parent entity, its related practices and non-related audit firms:
Auditors of the Group
| 2025 | 2024 | |||||||
| AUD | AUD | |||||||
| Audit services | ||||||||
| Audit and review of financial reports | 45,000 | 65,500 | ||||||
| Total audit and review of financial reports | 45,000 | 65,500 | ||||||
| Non-audit services | ||||||||
| Tax compliance and advisory services | 9,500 | 8,000 | ||||||
| Consulting services | - | 19,450 | ||||||
| Total other non-audit services | 9,500 | 27,450 | ||||||
| Total services provided | 54,500 | 92,950 | ||||||
As part of the planned NASDAQ Listing in 2026, the Group engaged BDO Audit Pty Ltd (“BDO”) to perform the audit services as they are a PCAOB registered audit firm in Australia. Total amounts agreed for services in relation to the audit of June 30, 2025 and June 30, 2024 as well as prospectus related work was AUD 450,000. This is not recorded in these financial years as work was engaged and commenced post year end.
| 27. | RELATED PARTY TRANSACTIONS |
| (a) | Parent entity |
The ultimate parent entity within the Group is Chilwa Minerals Limited.
| (b) | Subsidiaries |
Interests in subsidiaries are set out in note 28.
F-28
| 27. | RELATED PARTY TRANSACTIONS (Cont’d) |
| (c) | Transactions with key management personnel |
The aggregate value of transactions and outstanding balances related to key management personnel and entities over which they have control or significant influence are shown below:
| (i) | Key management personnel compensation |
| 2025 | 2024 | |||||||
| AUD | AUD | |||||||
| Short-term benefits | 650,000 | 738,138 | ||||||
| Post-employment benefits | 40,250 | 40,988 | ||||||
| Share-based payments | 827,625 | 379,482 | ||||||
| 1,517,875 | 1,158,608 | |||||||
| (ii) | Transactions with other related parties |
Transactions with key management personnel during the financial year disclosed below:
| ● | In addition to Mr Shaw and Mr Mota’s remuneration as directors, expenses totalling of AUD 2,888,004 for the year ended June 30, 2025 and AUD 2,405,321 for the year ended June 30, 2024 was paid or due and payable to Mota Engil and associated companies. Mota Engil is a global construction and engineering company listed in Portugal. Both of Mr Shaw and Mr Mota are directors of Luso, a subsidiary of the Mota Engil group of companies, of which Luso is a significant shareholder of the Company. The expenditure incurred was for associated technical and drilling services in Malawi in accordance with the services agreement. At June 30, 2025 and June 30, 2024 the total of AUD 1,859,338 and AUD 1,730,266 was payable to Mota Engil and associated companies respectively. |
| ● | In addition to Mr Wilkins’ remuneration as a director, a total of AUD 429,373 and AUD 180,264 was paid or due and payable to DW Corporate Pty Ltd, a business of which Mr Wilkins is principal for June 30, 2025 and June 30, 2024 respectively. DW Corporate Pty Ltd provided company secretarial, accounting and bookkeeping services to the Group during the years. The amounts charged were on an hourly basis. At June 30, 2025 there was AUD 27,810 owing to DW Corporate Pty Ltd. At June 30, 2024 there was AUD 19,506 owing to DW Corporate Pty Ltd. |
| 28. | SUBSIDIARIES |
The consolidated financial statements incorporate the assets, liabilities and results of the following subsidiaries in accordance with the accounting policy described in note 1:
| Equity Holding (1) | ||||||||||||
| Country of | Class of | 2025 | 2024 | |||||||||
| Name | incorporation | shares | % | % | ||||||||
| Chilwa Minerals Africa Ltd (2) | Malawi | Ordinary | 100 | 100 | ||||||||
| Mota-Engil Investments (Malawi) Ltd (2) | Malawi | Ordinary | 100 | 100 | ||||||||
| (1) | The proportion of ownership interest is equal to the proportion of voting power held. |
| (2) | Both entities were acquired on July 1, 2023. |
F-29
| 29. | PARENT ENTITY INFORMATION |
The following information relates to the parent company, Chilwa Minerals Limited. The information presented here has been prepared in accordance with the accounting policies of the Group.
| 2025 | 2024 | |||||||
| AUD | AUD | |||||||
| Current assets | 811,385 | 4,152,973 | ||||||
| Non-current assets | 19,697,515 | 11,459,287 | ||||||
| Total assets | 20,508,900 | 15,612,260 | ||||||
| Current liabilities | 2,683,170 | 2,483,327 | ||||||
| Total liabilities | 2,683,170 | 2,483,327 | ||||||
| Contributed equity | 18,986,249 | 11,863,857 | ||||||
| Share-based payments reserve | 5,441,158 | 4,544,171 | ||||||
| Accumulated losses | (6,601,677 | ) | (3,279,095 | ) | ||||
| Total equity | 17,825,730 | 13,128,933 | ||||||
| Loss for the year | (3,322,582 | ) | (1,814,609 | ) | ||||
| Total comprehensive loss for the year | (3,322,582 | ) | (1,814,609 | ) | ||||
| 30. | CONTINGENCIES |
There are no material contingent liabilities or contingent assets of the Group at reporting dates.
| 31. | COMMITMENTS |
| Exploration commitments |
|
The Group has certain exploration commitments arising from its mineral tenements held by the Group. These commitments primarily relate to minimum expenditure requirements imposed under the relevant licences to maintain the right to explore. These amounts are discretionary, however if the expenditure commitments are not met then the associated exploration and mining leases may be relinquished. |
As at the reporting dates, the Group is required to incur the following amounts of exploration and evaluation expenditure:
| 2025 | 2024 | |||||||
| AUD | AUD | |||||||
| Within one year (1) (2) | 189,848 | 2,085,546 | ||||||
| Later than one year but not later than five years | - | 668,199 | ||||||
| Later than five years | - | - | ||||||
| 189,848 | 2,753,745 | |||||||
| (1) | The 2025 exploration commitment excludes any expenditure that arise from the renewal of exploration licences in July 2025. Refer to the note 32 on the exploration commitments associated with extension of existing licences and grant of a new licence. |
| (2) | In 2024, a post completion obligation included within the SSA for the acquisition of the Chilwa Critical Minerals Project was for the Group to expend at least AUD 4,500,000 on exploration activities on the Chilwa Critical Minerals Project during the two-year period following listing on the ASX. This was achieved during the 2025 financial year. |
F-30
| 32. | EVENTS AFTER THE REPORTING PERIOD |
In July 2025 the Group renewed its exploration licenses EL0670/22 and EL0671/22. The tenement area for these licenses was split into three licenses, with the licenses EL0670/22R1 and EL0671/22 renewed for three years in Chilwa Mineral Africa and EL0835/25 granted for five years to a newly formed 100% owned subsidiary, Phalombe Minerals Limited, incorporated in Malawi on 8 July 2025.
Following the Company’s achievement of the performance milestone associated with the Class A Performance Rights, being the Company announcing a JORC compliant Indicated Resource of 3 million tonnes THM no later than June 30, 2025, 10,000,000 class A Performance Rights vested.
On August 4, 2025, the Company announced a two-tranche private placement to institutional, sophisticated and professional investors to raise AUD 4.13 million, issuing 3,930,637 Shares at AUD 1.05 per share in three tranches. (3,544,922 Shares were issued August 8, 2025, 338,096 Shares were issued September 9, 2025 and 47,619 Shares were issued October 10, 2025). The final tranche followed approval by Shareholders at an Extraordinary General Meeting (EGM) held October 8, 2025.
On October 20, 2025, Dennis Wilkins resigned from his role as Non-Executive Director, and Jose Martins was appointed as a Non-Executive Director with effect from the same date.
On October 24, 2025, the Company undertook a two-tranche private placement to raise up to AUD 8 million. Pursuant to the placement the Company issued 6,687,860 shares @ AUD 1.20, 3,891,666 Shares were issued on October 31, 2025, 1,087,667 Shares were issued on November 5, 2025 and 1,708,527 shares were issued to directors and related parties January 19, 2026 following shareholder approval at an EGM held January 7, 2026. On January 20,2026, the Company issued 7 million performance rights to directors following AGM approval and finalisation of associated compliance documentation.
On February 19, 2026, the Company announced the commencement of Mark Laybourn as CFO effective 18 February 2026.
No other matters or circumstances have arisen since the end of the year which significantly affected or may significantly affect the operations of the Group, the results of those operations, or the state of affairs of the Group in future financial periods.
F-31
CHILWA MINERALS LIMITED
ABN 43 656 965 589
INTERIM UNAUDITED FINANCIAL STATEMENTS
FOR THE HALF-YEAR ENDED
DECEMBER 31, 2025
This interim unaudited financial statements does not include all the notes of the type normally included in an annual financial report. Accordingly, this report is to be read in conjunction with the Annual Report for the year ended 30 June 2025 and any public announcements made by Chilwa Minerals Limited during the interim reporting period in accordance with the continuous disclosure requirements of the Corporations Act 2001.
F-32
CHILWA MINERALS LIMITED
INTERIM UNAUDITED FINANCIAL STATEMENTS DECEMBER 31, 2025
INTERIM UNAUDITED CONDENSED CONSOLIDATED STATEMENT OF Profit or loss and other COMPREHENSIVE INCOME
FOR THE HALF-YEAR ENDED December, 31 (Expressed in Australian Dollars (“AUD”)) |
| Half-Year | ||||||||||
| Note | Dec 31, 2025 AUD | Dec 31, 2024 AUD | ||||||||
| Revenue and Other Income | ||||||||||
| Other income | 23,968 | 53,366 | ||||||||
| Expenditure | ||||||||||
| Employee benefits expense | (696,408 | ) | (431,188 | ) | ||||||
| Consultancy and professional fees | (231,942 | ) | (89,335 | ) | ||||||
| Administrative expenses | (259,286 | ) | (228,583 | ) | ||||||
| Share-based payments expense | 9 | (687,482 | ) | (374,795 | ) | |||||
| Compliance and regulatory costs | (765,667 | ) | (231,607 | ) | ||||||
| Depreciation expense | (60,916 | ) | (24,639 | ) | ||||||
| Other expenses | - | (26,741 | ) | |||||||
| Loss Before Income Tax | (2,677,733 | ) | (1,353,522 | ) | ||||||
| Income tax benefit /(expense) | - | - | ||||||||
| Loss After Tax Attributable to Owners | (2,677,733 | ) | (1,353,522 | ) | ||||||
| Other comprehensive income / (loss) | 3,222 | (2,811 | ) | |||||||
| Total Comprehensive Loss Attributable to Owners | (2,674,511 | ) | (1,356,333 | ) | ||||||
| Basic and diluted loss per share attributable to the owners of Chilwa Minerals Limited (cents) | (3.13 | ) | (1.98 | ) | ||||||
The above condensed consolidated statement of profit or loss and other comprehensive income should be read in conjunction with the accompanying notes.
F-33
CHILWA MINERALS LIMITED
INTERIM UNAUDITED FINANCIAL STATEMENTS DECEMBER 31, 2025
INTERIM UNAUDITED CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT (Expressed in Australian Dollars (“AUD”)) |
| Dec 31, 2025 | Jun 30, 2025 | |||||||||
| Note | AUD | AUD | ||||||||
| Current Assets | ||||||||||
| Cash and cash equivalents | 3 | 3,590,073 | 687,022 | |||||||
| Trade and other receivables | 92,158 | 77,584 | ||||||||
| Prepayments | 4 | 77,719 | 64,085 | |||||||
| Total Current Assets | 3,759,950 | 828,691 | ||||||||
| Non-Current Assets | ||||||||||
| Prepayments | 4 | 669,253 | 679,832 | |||||||
| Plant and equipment | 6 | 387,562 | 376,467 | |||||||
| Right-of-use of assets | 63,842 | 67,711 | ||||||||
| Exploration and evaluation assets | 5 | 22,729,567 | 18,598,678 | |||||||
| Total Non-Current Assets | 23,850,224 | 19,722,688 | ||||||||
| Total Assets | 27,610,174 | 20,551,379 | ||||||||
| Current Liabilities | ||||||||||
| Trade and other payables | 7 | 1,483,598 | 2,717,809 | |||||||
| Employee benefit obligations | 50,987 | 56,291 | ||||||||
| Lease liabilities | 65,652 | 65,652 | ||||||||
| Borrowings | - | - | ||||||||
| Total Current Liabilities | 1,600,237 | 2,839,752 | ||||||||
| Total Liabilities | 1,600,237 | 2,839,752 | ||||||||
| Equity | ||||||||||
| Contributed equity | 8 | 31,425,056 | 18,986,249 | |||||||
| Reserves | 8 | 3,904,804 | 5,367,568 | |||||||
| Accumulated losses | (9,319,923 | ) | (6,642,190 | ) | ||||||
| Total Equity | 26,009,937 | 17,711,627 | ||||||||
The above condensed consolidated statement of financial position should be read in conjunction with the accompanying notes.
F-34
CHILWA MINERALS LIMITED
INTERIM UNAUDITED FINANCIAL STATEMENTS DECEMBER 31, 2025
INTERIM UNAUDITED CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE HALF-YEAR ENDED DECEMBER, 31 (Expressed in Australian Dollars (“AUD”)) |
| Contributed Equity AUD | Share-based Payments Reserve AUD | Foreign Currency Translation Reserve AUD | Accumulated Losses AUD | Total Equity AUD | ||||||||||||||||
| Balance at July 1, 2024 | 11,863,857 | 4,544,171 | 2,345 | (3,279,095 | ) | 13,131,278 | ||||||||||||||
| Loss for the half-year | - | - | - | (1,353,522 | ) | (1,353,522 | ) | |||||||||||||
| Foreign currency translation of foreign operations | - | - | (2,811 | ) | - | (2,811 | ) | |||||||||||||
| Total Comprehensive Loss for the Period | - | - | (2,811 | ) | (1,353,522 | ) | (1,356,333 | ) | ||||||||||||
| Transactions with Owners in Their Capacity as Owners | ||||||||||||||||||||
| Shares issued | 4,825,212 | - | - | - | 4,825,212 | |||||||||||||||
| Options conversion to shares | 51,517 | (51,517 | ) | - | - | - | ||||||||||||||
| Share issue transaction costs | (23,736 | ) | - | - | - | (23,736 | ) | |||||||||||||
| Equity-settled share-based payment | - | 374,795 | * | - | - | 374,795 | ||||||||||||||
| Balance at December 31, 2024 | 16,716,850 | 4,867,449 | (466 | ) | (4,632,617 | ) | 16,951,216 | |||||||||||||
| Balance at July 1, 2025 | 18,986,249 | 5,441,159 | (73,591 | ) | (6,642,190 | ) | 17,711,627 | |||||||||||||
| Loss for the half-year | - | - | - | (2,677,733 | ) | (2,677,733 | ) | |||||||||||||
| Foreign currency translation of foreign operations | - | - | 3,222 | - | 3,222 | |||||||||||||||
| Total comprehensive Loss for the Period | - | - | 3,222 | (2,677,733 | ) | (2,674,511 | ) | |||||||||||||
| Transactions with Owners in Their Capacity as Owners | ||||||||||||||||||||
| Shares issued | 10,533,827 | - | - | - | 10,533,827 | |||||||||||||||
| Options and performance rights conversion to shares | 2,153,468 | (2,153,468 | ) | - | - | - | ||||||||||||||
| Share issue transaction costs | (248,488 | ) | - | - | - | (248,488 | ) | |||||||||||||
| Equity-settled share-based payment | - | 687,482 | - | - | 687,482 | |||||||||||||||
| Balance at December 31, 2025 | 31,425,056 | 3,975,173 | (70,369 | ) | (9,319,923 | ) | 26,009,937 | |||||||||||||
The above condensed consolidated statement of changes in equity should be read in conjunction with the accompanying notes.
F-35
CHILWA MINERALS LIMITED
INTERIM UNAUDITED FINANCIAL STATEMENTS DECEMBER 31, 2025
INTERIM UNAUDITED CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE HALF-YEAR ENDED DECEMBER 31 (Expressed in Australian Dollars (“AUD”)) |
| Half-year | ||||||||||
| Note | Dec 31, 2025 AUD | Dec 31, 2024 AUD | ||||||||
| Cash Flows from Operating Activities | ||||||||||
| Payments to suppliers and employees | (1,882,099 | ) | (1,066,145 | ) | ||||||
| Interest received | 23,968 | 53,366 | ||||||||
| Net cash (outflow) from operating activities | (1,858,131 | ) | (1,012,779 | ) | ||||||
| Cash Flows from Investing Activities | ||||||||||
| Payments for exploration expenditure capitalised | 5 | (5,399,038 | ) | (2,458,270 | ) | |||||
| Payments for plant and equipment | 6 | (68,674 | ) | (808,657 | ) | |||||
| Net cash (outflow) from investing activities | (5,467,712 | ) | (3,266,927 | ) | ||||||
| Cash Flows from Financing Activities | ||||||||||
| Proceeds from issue of share capital | 8 | 10,502,403 | 4,825,212 | |||||||
| Payments of share issue transaction costs | (248,486 | ) | (23,736 | ) | ||||||
| Net cash (outflow) from financing activities | 10,253,917 | 4,801,476 | ||||||||
| Net increase (decrease) in cash and cash equivalents | 2,928,074 | 521,770 | ||||||||
| Cash and cash equivalents at the beginning of the half-year | 687,022 | 4,151,024 | ||||||||
| Effects of exchange rate changes | (25,023 | ) | (27,060 | ) | ||||||
| Cash and Cash Equivalents at the End of the Period | 3,590,073 | 4,645,734 | ||||||||
The above condensed consolidated statement of cash flows should be read in conjunction with the accompanying notes.
F-36
CHILWA MINERALS LIMITED
INTERIM UNAUDITED FINANCIAL STATEMENTS DECEMBER 31, 2025
Notes to the INTERIM UNAUDITED financial statements
NOTE 1. BASIS OF PREPARATION OF THE INTERIM UNAUDITED FINANCIAL STATEMENTS
Chilwa Limited (“Company”) is a company domiciled in Australia. The consolidated interim unaudited financial statements as at and for the half year ended 31 December 2025 comprises the Company and its subsidiaries (together referred to as “Group”). The Company is a mineral exploration company with prospects in Malawi.
This consolidated interim unaudited financial statements for the half-year reporting period ended December 31, 2025 has been prepared in accordance with IAS 134 Interim Financial Reporting and the Corporations Act 2001.
This consolidated interim unaudited financial statements does not include all the notes of the type normally included in an annual financial report and therefore cannot be expected to provide a full understanding of the financial performance, financial position and financing and investing activities of the Group as full financial statements. Accordingly, this report is to be read in conjunction with the annual report for the year ended 30 June 2025 and any public announcements made by Chilwa Minerals Limited during the interim reporting period in accordance with the continuous disclosure requirements of the Corporations Act 2001.
The accounting policies adopted are consistent with those of the previous financial year and corresponding interim reporting period unless otherwise stated.
These interim unaudited financial statements were authorised for issue by a resolution of directors on March 16, 2026.
The interim unaudited financial statements are presented in Australian Dollars (AUD), which is the Company’s presentation currency. All amounts have been rounded to the nearest dollar.
New and amended standards adopted by the Group
A number of amended standards became applicable for the current reporting period. The Group did not have to change its accounting policies or make retrospective adjustments as a result of adopting these amended standards.
Impact of standards issued but not yet applied by the Group
The Group has also reviewed all new Standards and Interpretations that have been issued but are not yet effective for the half-year ended 31 December 2025. As a result of this review the Directors believe there to be no impact, material or otherwise, on the Group’s financial performance or financial position. However, management continues to formalise its full assessment of the impact of new standards.
Going Concern
The consolidated financial statements have been prepared on the going concern basis, which contemplates the continuity of normal business activity and the realisation of assets and the settlement of liabilities in the ordinary course of business.
At December 31, 2025, the Group had cash on hand of AUD 3,590,073 (June 30, 2025: AUD 687,022) and net current assets of AUD 2,159,713 (June 30, 2025: net current liabilities of AUD 2,011,061). The Group made an operating loss before tax for the half-year ended December 31, 2025 of AUD 2,677,733 (December 31, 2024: AUD 1,353,522) and had a cash outflow from operating activities and investing activities of AUD 7,325,843 (December 31, 2024: AUD 4,279,706).
In January 2026, the Group raised AUD 2 million under Tranche 2 of an October 2025 private placement, issuing 1,708,527 fully paid ordinary shares at AUD 1.20 per share (see ASX Announcement October 24, 2025 “Chilwa Completes AUD 8M Private Placement”). Tranche 2 of the placement included participation in the placement by directors and related parties following shareholder approval at an Extraordinary General Meeting held on January 7, 2026. The funds raised pursuant to the placement will contribute to working capital and will be used to accelerate development at the Group’s Chilwa Critical Minerals Project in Malawi.
At the date of signing these interim unaudited financial statements the Group has cash on hand of AUD 2,098,034.
The Group has performed a monthly cash flow forecast through to the period ending June 30, 2027, based on the best cost estimates available. In order to progress the Group’s planned objective of exploration at the Chilwa Project, further funding in the form of debt and/or equity raising will be required. These events give rise to a material uncertainty relating to going concern that may cast significant doubt on the Company’s ability to continue as a going concern to realise its assets and discharge its liabilities in the normal course of business. The directors are of the opinion that there are reasonable grounds to believe that the Group will be able to continue as a going concern for the following reasons:
| ● | The Group has a history of successful capital raising; and |
| ● | The Group has the ability to adjust expenditure and operational plans and will only commit to expenditure when there is appropriate funding in place; |
F-37
CHILWA MINERALS LIMITED
INTERIM UNAUDITED FINANCIAL STATEMENTS DECEMBER 31, 2025
Notes to the INTERIM UNAUDITED financial statements
NOTE 1. BASIS OF PREPARATION OF THE INTERIM UNAUDITED FINANCIAL STATEMENTS (Continued)
Should the Group be unable to continue as a going concern it may be required to realise its assets and extinguish its liabilities other than in the normal course of business and at amounts different to those stated in the financial statements. The interim unaudited financial statements do not include any adjustments relating to the recoverability and classification of asset carrying amounts or to the amount and classification of liabilities that might result should the Group be unable to continue as a going concern and meet its debts as and when they fall due.
NOTE 2. SEGMENT INFORMATION
Industry and geographical segment
The Group operates in one segment, being the mining exploration segment in Malawi, Africa.
In determining operating segments, the Group has had regard to the information and reports the chief operating decision maker uses to make strategic decisions regarding resources. The Managing Director is the chief operating decision maker and is empowered by the Board of Directors of the Company to allocate resources and assess the performance of the Group.
| Non-Current Assets | Dec 31, 2025 AUD | Jun 30, 2025 AUD | ||||||
| Australia | 86,850 | 84,916 | ||||||
| Malawi | 23,763,374 | 19,637,772 | ||||||
| 23,850,224 | 19,722,688 | |||||||
NOTE 3: CASH AND CASH EQUIVALENTS
Cash and cash equivalents include cash on hand, deposits held at call with banks, other highly liquid short-term investments with original maturities of 3 months or less, and bank overdrafts.
| Dec 31, 2025 AUD | Jun 30, 2025 AUD | |||||||
| Cash at bank and on hand | 3,590,073 | 687,022 | ||||||
| Cash and cash equivalents as shown in the statement of financial position and the statement of cash flows | 3,590,073 | 687,022 | ||||||
Cash at bank earns interest at floating rates based on daily bank deposit rates.
NOTE 4: PREPAYMENTS
| Dec 31, 2025 AUD | Jun 30, 2025 AUD | |||||||
| Current | ||||||||
| Prepaid Insurance | 37,803 | 8,285 | ||||||
| Prepaid Listing Fees | 20,431 | - | ||||||
| Prepaid Software Subscription | 17,175 | 55,800 | ||||||
| Others | 2,310 | - | ||||||
| 77,719 | 64,085 | |||||||
| Non-current | ||||||||
| Prepaid Drilling | 669,253 | 679,832 | ||||||
| 669,253 | 679,832 | |||||||
| Prepayments | 746,972 | 743,917 | ||||||
F-38
CHILWA MINERALS LIMITED
INTERIM UNAUDITED FINANCIAL STATEMENTS DECEMBER 31, 2025
Notes to the INTERIM UNAUDITED financial statements
NOTE 5. EXPLORATION AND EVALUATION ASSETS
| Dec 31, 2025 AUD | Jun 30, 2025 AUD | |||||||
| Exploration and evaluation assets | 22,729,567 | 18,598,678 | ||||||
| Balance at the beginning of the period | 18,598,678 | 11,333,988 | ||||||
| Expenditure incurred | 4,130,889 | 7,264,690 | ||||||
| Balance at the end of the period | 22,729,567 | 18,598,678 | ||||||
NOTE 6. PROPERTY, PLANT AND EQUIPMENT
| Dec 31, 2025 AUD | Jun 30, 2025 AUD | |||||||
| Cost | 561,960 | 493,819 | ||||||
| Accumulated depreciation | (174,398 | ) | (117,352 | ) | ||||
| 387,562 | 376,467 | |||||||
| Balance at the beginning of the period | 376,467 | 67,356 | ||||||
| Additions | 68,674 | 397,795 | ||||||
| Depreciation | (57,046 | ) | (88,534 | ) | ||||
| Foreign exchange movement | (533 | ) | (150 | ) | ||||
| Balance at the end of the period | 387,562 | 376,467 | ||||||
NOTE 7: TRADE AND OTHER PAYABLES
| Dec 31, 2025 AUD | Jun 30, 2025 AUD | |||||||
| Trade and other payables | 254,408 | 480,847 | ||||||
| Accrued and other expenses | 1,229,190 | 2,236,962 | ||||||
| 1,483,598 | 2,717,809 | |||||||
F-39
CHILWA MINERALS LIMITED
INTERIM UNAUDITED FINANCIAL STATEMENTS DECEMBER 31, 2025
Notes to the INTERIM UNAUDITED financial statements
NOTE 8. EQUITY
Contributed Equity
| Dec 31, 2025 | Dec 31, 2024 | |||||||||||||||
| Ordinary share capital | Shares | AUD | Shares | AUD | ||||||||||||
| Ordinary shares – fully paid | 96,127,444 | 32,453,421 | 73,126,617 | 17,496,730 | ||||||||||||
| Transaction costs | - | (1,028,365 | ) | - | (779,880 | ) | ||||||||||
| 96,127,444 | 31,425,056 | 73,126,617 | 16,716,850 | |||||||||||||
| Dec 31, 2025 | Dec 31, 2024 | |||||||||||||||||
| Ordinary Share Capital | Shares | AUD | Shares | AUD | ||||||||||||||
| As at July 1 | 75,765,468 | 18,986,249 | 67,200,001 | 11,863,857 | ||||||||||||||
| Issued during the half-year | ||||||||||||||||||
| 07/30/2025 | PRs converted fair value transfer | 2,500,000 | 500,000 | - | - | |||||||||||||
| 08/04/2025 | Options exercised at AUD 0.25 | 198,886 | 49,722 | - | - | |||||||||||||
| 08/04 /2025 | Options exercised at AUD 0.30 | 249,911 | 74,973 | - | - | |||||||||||||
| 08/04/2025 | Options exercised at AUD 0.40 | 102,605 | 41,042 | - | - | |||||||||||||
| 08/04/2025 | Options converted fair value transfer | - | 57,956 | - | - | |||||||||||||
| 08/08/2025 | Placement shares issued at AUD 1.05 | 3,544,922 | 3,722,168 | - | - | |||||||||||||
| 08/14/2025 | Options exercised at AUD 0.25 | 258,535 | 64,634 | - | - | |||||||||||||
| 08/14/2025 | Options exercised at AUD 0.30 | 8,535 | 2,561 | - | - | |||||||||||||
| 08/14/2025 | Options exercised at AUD 0.40 | 8,535 | 3,414 | - | - | |||||||||||||
| 08/14/2025 | Options converted fair value transfer | - | 30,763 | - | - | |||||||||||||
| 09/09/2025 | Placement shares issued at AUD 1.05 | 338,096 | 355,000 | - | - | |||||||||||||
| 09/11/2025 | Options exercised at AUD 0.25 | 190,000 | 47,500 | - | - | |||||||||||||
| 09/11/2025 | Options converted fair value transfer | - | 21,375 | - | - | |||||||||||||
| 10/10/2025 | Placement shares issued at AUD 1.05 | 47,619 | 50,000 | - | - | |||||||||||||
| 10/21/2025 | Options exercised at AUD 0.30 | 180,250 | 54,075 | - | - | |||||||||||||
| 10/21/2025 | Options converted fair value transfer | - | 18,854 | - | - | |||||||||||||
| 10/31/2025 | Placement shares issued at AUD 1.20 | 3,891,666 | 4,670,000 | - | - | |||||||||||||
| 11/05/2025 | Placement shares issued at AUD 1.20 | 1,087,667 | 1,305,200 | - | - | |||||||||||||
| 11/06/2025 | Options exercised at AUD 0.25 | 18,250 | 4,563 | - | - | |||||||||||||
| 11/06/2025 | Options converted fair value transfer | - | 2,053 | - | - | |||||||||||||
| 11/07/2025 | PRs converted fair value transfer | 7,500,000 | 1,500,000 | - | - | |||||||||||||
| 11/20/2025 | Options exercised at AUD 0.40 | 180,249 | 72,100 | - | - | |||||||||||||
| 11/20/2025 | Options converted fair value transfer | - | 16,583 | - | - | |||||||||||||
| 11/28/2025 | Options exercised at AUD 0.30 | 56,250 | 16,875 | - | - | |||||||||||||
| 11/28/2025 | Options converted fair value transfer | - | 5,884 | - | - | |||||||||||||
| 07/29/2024 | Options exercised at AUD 0.25 | - | - | 166,666 | 41,666 | |||||||||||||
| 07/29/2024 | Options exercised at AUD 0.30 | - | - | 166,667 | 50,000 | |||||||||||||
| 07/29/2024 | Options exercised at AUD 0.40 | - | - | 166,667 | 66,667 | |||||||||||||
| 07/29/2024 | Options converted fair value transfer | - | - | - | 51,517 | |||||||||||||
| 10/22/2024 | Placement shares issued at AUD 0.86 | - | - | 4,287,070 | 3,686,880 | |||||||||||||
| 11/05/2024 | Placement shares issued at AUD 0.86 | - | - | 1,139,546 | 979,999 | |||||||||||||
| Transaction costs | - | (248,488 | ) | - | (23,736 | ) | ||||||||||||
| As at December 31 | 96,127,444 | 31,425,056 | 73,126,617 | 16,716,850 | ||||||||||||||
| * | Refer Note 15 |
F-40
CHILWA MINERALS LIMITED
INTERIM UNAUDITED FINANCIAL STATEMENTS DECEMBER 31, 2025
Notes to the INTERIM UNAUDITED financial statements
NOTE 8. EQUITY (Continued)
In August 2025, the Company announced a two-tranche private placement to institutional, sophisticated and professional investors to raise AUD 4.13 million, issuing 3,930,637 Shares at AUD 1.05 per share in three tranches. (3,544,922 shares were issued on August 8, 2025, 338,096 shares were issued on September 9, 2025 and 47,619 shares were issued October 10, 2025). The final tranche followed approval by Shareholders at an Extraordinary General Meeting (EGM) held October 8, 2025.
In October 2025, the Company undertook another two-tranche private placement to raise up to AUD 8 million. Pursuant to the placement the Company issued 6,687,860 shares at AUD 1.20. The first tranche of 5,699,333 shares was issued as follows, 3,891,666 shares were issued on October 31, 2025 and 1,087,667 shares were issued on November 5, 2025.
Reserves
The table below provides a reconciliation of the movement in the Company’s share-based payment reserve during the period.
| Share based payments reserve | Dec 31, 2025 AUD | Jun 30, 2025 AUD | ||||||
| At July 1 | 5,441,159 | 4,544,171 | ||||||
| Share based payment expense | 687,482 | 374,795 | ||||||
| Value recognised in exploration and evaluation assets | - | - | ||||||
| Options conversion – fair value transfer | (153,468 | ) | (51,517 | ) | ||||
| Performance rights conversion – fair value transfer | (2,000,000 | ) | - | |||||
| At December 31 | 3,975,173 | 4,867,449 | ||||||
| Foreign currency translation reserve | Dec 31, 2025 AUD | Jun 30, 2025 AUD | ||||||
| At July 1 | (73,591 | ) | 2,345 | |||||
| Foreign currency translation of foreign operations | 3,222 | (2,811 | ) | |||||
| At December 31 | (70,369 | ) | (466 | ) | ||||
Accordingly, the total value of the Company’s reserves at December 31, 2025 are AUD 3,904,804 (December 31, 2024: AUD 4,866,983).
F-41
CHILWA MINERALS LIMITED
INTERIM UNAUDITED FINANCIAL STATEMENTS DECEMBER 31, 2025
Notes to the INTERIM UNAUDITED financial statements
NOTE 9. SHARE-BASED PAYMENTS
The table below provides a reconciliation of the number of options on issue by the Company.
| Number of options | ||||||||||
| Options | Dec 31, 2025 | Dec 31, 2024 | ||||||||
| As at July 1 | 2,500,000 | 3,000,000 | ||||||||
| 08/04/2025 | Options exercised at AUD 0.25 | (198,886 | ) | - | ||||||
| 08/04/2025 | Options exercised at AUD 0.30 | (249,911 | ) | - | ||||||
| 08/04/2025 | Options exercised at AUD 0.40 | (102,605 | ) | - | ||||||
| 08/14/2025 | Options exercised at AUD 0.25 | (258,535 | ) | - | ||||||
| 08/14/2025 | Options exercised at AUD 0.30 | (8,535 | ) | - | ||||||
| 08/14/2025 | Options exercised at AUD 0.40 | (8,535 | ) | - | ||||||
| 09/11/2025 | Options exercised at AUD 0.25 | (190,000 | ) | - | ||||||
| 10/21/2025 | Options exercised at AUD 0.30 | (180,250 | ) | - | ||||||
| 11/06/2025 | Options exercised at AUD 0.25 | (18,250 | ) | - | ||||||
| 11/20/2025 | Options exercised at AUD 0.40 | (180,249 | ) | - | ||||||
| 11/28/2025 | Options exercised at AUD 0.30 | (56,250 | ) | - | ||||||
| 07/29/2024 | Options exercised at AUD 0.25 | - | (166,666 | ) | ||||||
| 07/29/2024 | Options exercised at AUD 0.30 | - | (166,667 | ) | ||||||
| 07/29/2024 | Options exercised at AUD 0.40 | - | (166,667 | ) | ||||||
| As at December 31 | 1,047,994 | 2,500,000 | ||||||||
The weighted average remaining contractual life of the share options outstanding at the end of the reporting period was 1.5 years (December 31, 2024: 2.5 years).
The table below provides a reconciliation of the number of performance rights on issue by the Company.
| Number of performance rights | ||||||||||
| Performance Rights | Dec 31, 2025 | Dec 31, 2024 | ||||||||
| As at July 1 | 28,750,000 | 25,000,000 | ||||||||
07/30/2025 | Converted Class A to ordinary shares (1) | (2,500,000 | ) | - | ||||||
10/28/2025 | Granted Class F, unlisted, expiring 11/30/2030 (2) | 7,000,000 | - | |||||||
11/07/2025 | Converted Class A to ordinary shares (1) | (7,500,000 | ) | - | ||||||
11/30/2024 | Issued Class E, unlisted, expiring 11/30/2028 (3) | - | 3,750,000 | |||||||
| As at December 31 | 25,750,000 | 28,750,000 | ||||||||
| Total | ||||||||||||
| Number of performance rights | 5,000,000 | 5,000,000 | 5,000,000 | 3,750,000 | 7,000,000 | 25,750,000 | ||||||
| Class | B | C | D | E | F | |||||||
| Grant date | 04/05/2023 | 04/05/2023 | 04/05/2023 | 10/09/2024 | 10/28/2025 | |||||||
| Valuation date | 07/01/2023 | 07/01/2023 | 07/01/2023 | 11/07/2024 | 11/27/2025 | |||||||
| Expiry date | 06/30/2027 | 06/30/2027 | 06/30/2028 | 06/30/2028 | 11/30/2030 | |||||||
| Vesting date | 06/30/2027 | 06/30/2027 | 06/30/2028 | 06/30/2028 | 11/30/2027 | |||||||
| Underlying share price at grant date | 0.20 | 0.20 | 0.20 | 0.83 | 0.935 | |||||||
| Fair value per performance right | 0.20 | 0.20 | 0.20 | 0.83 | 0.935 | |||||||
| Probability of performance condition | 100% | 100% | 100% | 100% | 100% | |||||||
| Exercise price, AUD | nil | nil | nil | nil | nil |
| (1) | On July 30, 2025, 2,500,000 performance rights held by current and former directors and employees were converted into ordinary shares. On November 7, 2025, 7,500,000 performance rights held by Luso Global Mining BV were converted into ordinary shares. Conversion to fully paid ordinary shares followed compliance with relevant provisions of the terms of the performance rights and of the Corporations Act. |
F-42
CHILWA MINERALS LIMITED
INTERIM UNAUDITED FINANCIAL STATEMENTS DECEMBER 31, 2025
Notes to the INTERIM UNAUDITED financial statements
NOTE 9. SHARE-BASED PAYMENTS (Continued)
| (2) | On October 28, 2025, 7,000,000 performance rights were granted to directors. The grant was approved at the Annual General Meeting on November 27, 2025, and the rights were issued on January 20, 2026. The performance rights will vest upon the Company releasing an announcement by November 30, 2027, in accordance with the Listing Rules, reporting a JORC Code (2012) compliant Mineral Resource of Total Rare Earth Oxide (TREO). Of the total performance rights granted, 3,500,000 will vest upon the announcement of an Indicated Resource of at least 35 Mt at 1% TREO or equivalent. The remaining 3,500,000 performance rights will vest upon the announcement of an Indicated Resource of at least 60 Mt at 2% TREO or equivalent. During the half-year period an expense of AUD 228,723 in relation to these securities was recognised in profit or loss. |
| (3) | On November 30, 2024, performance rights were issued to the directors of the Company in accordance with the shareholders’ approval at the annual general meeting held on November 7, 2024. The vesting condition for the performance rights is the approval and issue of a mining license for the Chilwa Critical Minerals Project by November, 30 2028. During the half-year period an expense of AUD 378,269 (December 31, 2024: AUD 171,279) in relation to these securities was recognised in profit or loss. |
The performance rights will vest upon satisfaction of the respective performance conditions at any time before the applicable expiry date, as detailed below:
| Class | Performance Condition | |
| Class B | Announcement of a PFS (as defined in the JORC Code) that recommends further proceeding with the Chilwa Project on or before June, 30 2027. | |
| Class C | Announcement of the completion of a feasibility study (as defined in the JORC Code) that recommends further proceeding with the Chilwa Project on or before June 30, 2027. | |
| Class D | Announcement that a decision to mine the Chilwa Project has been made on or before June 30, 2028. | |
| Class E | Approval and issue of a Mining Licence for Chilwa Critical Minerals Project by November 30, 2028. | |
| Class F | Announcement, in accordance with the Listing Rules of a JORC Code 2012 Mineral Resource of Total Rare Earth Oxide (TREO), indicating resource of at least:
● 3,500,000 performance rights - 35 Mt at 1% TREO or equivalent by November 30, 2027
● 3,500,000 performance rights - 60 Mt at 2% TREO or equivalent by November 30, 2027 |
The total share-based payment expense recognised in reporting period is AUD 687,482 (December 31, 2024: AUD 374,795). This includes the expense of AUD 458,759 that relates to the performance rights issued to directors and employees in prior periods, and AUD 228,723 relating to the performance rights issued to the directors during the current period.
NOTE 10. DIVIDENDS
No dividends were paid during the half-year. No recommendation for payment of dividends has been made.
NOTE 11. COMMITMENTS
In order to maintain current rights of tenure to exploration and mining tenements, the Group will be required to outlay the amounts disclosed in the below table. These amounts are discretionary, however if the expenditure commitments are not met then the associated exploration and mining leases may be relinquished.
| Dec 31, 2025 AUD | Jun 30, 2025 AUD | |||||||
| Within one year | 51,263 | 189,848 | ||||||
| Later than one year but not later than five years | 623,003 | - | ||||||
| Later than five years | - | - | ||||||
| 674,266 | 189,848 | |||||||
The comparative information as at 30 June 2025 has been adjusted to exclude expenditure commitments linked to the renewal of exploration licences in July 2025 and therefore were not in place at 30 June 2025.
F-43
CHILWA MINERALS LIMITED
INTERIM UNAUDITED FINANCIAL STATEMENTS DECEMBER 31, 2025
Notes to the INTERIM UNAUDITED financial statements
NOTE 12. CONTINGENCIES
There are no material contingent assets or liabilities as at the reporting date.
NOTE 13. RELATED PARTY TRANSACTIONS
There has been no material change to the nature and type of related party transactions in the half-year ended 31 December 2025. The grant of performance rights to key management personnel (Note 9) during the period and drilling and service fee costs paid to Mota Engil for the period and owing at the period end are shown in the tables below.
| Key Management Personnel | No of Performance Rights granted in the period | |||
| Cadell Buss | 3,000,000 | |||
| Alexander Shaw | 2,000,000 | |||
| Manuel Mota | 1,500,000 | |||
| José Martins | 500,000 | |||
| 7,000,000 | ||||
Material outstanding balances with related parties included in trade and other payables as at period-end are as follows:
| Expenses for drilling and service fees to Half Year to Dec 31, 2025 AUD | Balance owing Dec 31, 2025 AUD | Balance owing Jun 30, 2025 AUD | ||||||||||
| Mota-Engil and associated companies (1) | 2,015,235 | 657,400 | 1,859,338 | |||||||||
| (1) | Payments to Mota Engil include payments for diamond and sonic drilling services drilling and service fee costs for administrative services, personnel and consumables |
NOTE 14. EVENTS OCCURRING AFTER REPORTING DATE
On January 19, 2026, 1,708,527 shares were issued at AUD 1.20 following shareholder approval at the EGM held on January 7, 2026.
On January 20, 2026, the Company issued 7 million performance rights to directors following the AGM approval and finalisation of associated compliance documentation.
On February 19, 2026, the Company announced the commencement of Mark Laybourn as CFO effective February 18, 2026.
On April 13, 2026, the Company announced the appointment of Ms Susan Park as Company Secretary following the resignation of Dennis Wilkins.
On April 20, 2026 the Company changed its principal place of business and telephone number to Level 28, 140 St Georges Terrace, Perth WA 6000 and +61 8 6189 4924.
On April 27, 2026, the Company announced the appointment of Graham Hewson as Non-Executive Director, effective immediately.
No other matter or circumstance has arisen since December 31, 2025, which has significantly affected, or may significantly affect the operations of the Group, the result of those operations, or the state of affairs of the Group in subsequent financial periods.
F-44
American
Depositary Shares
Representing Ordinary Shares
Warrants to Purchase American
Depositary Shares
Representing Ordinary Shares
PRELIMINARY PROSPECTUS
, 2026
Maxim Group LLC
Through and including , 2026 (the 25th day after the date of this prospectus), all dealers effecting transactions in the ADSs and Warrants, whether or not participating in this offering, may be required to deliver a prospectus. This is in addition to a dealer’s obligation to deliver a prospectus when acting as an underwriter and with respect to an unsold allotment or subscription.
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 6. Indemnification of Directors and Officers.
Australian law. Australian law provides that a company or a related body corporate of a company may provide for indemnification of officers and directors, except to the extent of any of the following liabilities incurred as an officer or director of the company:
| ● | a liability owed to the company or a related body corporate of the company; |
| ● | a liability for a pecuniary penalty order made under section 1317G or a compensation order under section 961M, 1317H, 1317HA, 1317HB 1317HC or 1317HE of the Corporations Act; |
| ● | a liability that is owed to someone other than the company or a related body corporate of the company and did not arise out of conduct in good faith; or |
| ● | legal costs incurred in defending an action for a liability incurred as an officer or auditor of the company if the costs are incurred: |
| ● | in defending or resisting proceedings in which the person is found to have a liability for which they cannot be indemnified as set out above; |
| ● | in defending or resisting criminal proceedings in which the person is found guilty; |
| ● | in defending or resisting proceedings brought by the Australian Securities & Investments Commission or a liquidator for a court order if the grounds for making the order are found by the court to have been established (except costs incurred in responding to actions taken by the Australian Securities& Investments Commission or a liquidator as part of an investigation before commencing proceedings for a court order); or |
| ● | in connection with proceedings for relief to the person under the Corporations Act 2001, in which the court denies the relief. |
Constitution. Our Constitution provides that, except to the extent prohibited by the law and the Corporations Act and, to the extent that the officer is not otherwise indemnified by us pursuant to an indemnity, we indemnify every person who is or has been an officer of the Company against any liability or claim (other than legal costs that are unreasonable) incurred by that person as an officer. This includes any liability or claim incurred by that person in their capacity as an officer of a subsidiary of the Company where the Company requested that person to accept that appointment.
SEC Position. Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers or persons controlling us pursuant to the foregoing provisions, we have been informed that in the opinion of the SEC such indemnification is against public policy as expressed in the Securities Act and is therefore unenforceable.
ITEM 7. Recent Sales of Unregistered Securities.
Since July 1, 2023, the following changes have been made to our ordinary share capital:
| ● | On July 29, 2024, we issued 166,666 ordinary shares at an issue price of A$0.25, 166,666 ordinary shares at an issue price of A$0.30 and 166,667 ordinary shares at an issue price of A$0.40 upon the exercise of unquoted options granted in connection with a capital raising transaction. |
| ● | On October 22, 2024, we issued 4,287,070 ordinary shares in a placement to institutional and individual investors at an issue price of A$0.86. |
| ● | On November 5, 2024, we issued 1,139,546 ordinary shares comprising 813,965 shares under a share purchase plan and 325,581 shares at an issue price of A$0.86 in a placement to an individual |
| ● | On January 16, 2025, we issued 2,638,851 ordinary shares at an issue price of A$0.86 in a placement to directors of the Company (Cadell Buss (9,000), Alexander Shaw (58,140), Manuel Mota (116,279)) and major shareholder (Luso Global Mining BV) (2,455,432). |
| ● | On July 30, 2025, we issued 2,500,000 ordinary shares upon the exercise of performance rights by a director, employee and former employees (Cadell Buss (1,721,740), Pauline Blundell (75,000), John Lewis (175,000), and Philip Lucas (528,260)). |
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| ● | On August 4, 2025, we issued 198,886 ordinary shares at an issue price of A$0.25, 249,911 ordinary shares at an issue price of A$0.30 and 102,605 ordinary shares at an issue price of A$0.40 upon the exercise of unquoted options granted in connection with a capital raising transaction. |
| ● | On August 7, 2025, we issued 3,544,922 ordinary shares at an issue price of A$1.05 in a placement to institutional and individual investors. |
| ● | On August 14, 2025, we issued 258,535 ordinary shares at an issue price of A$0.25, 8,535 ordinary shares at an issue price of A$0.30 and 8,535 ordinary shares at an issue price of A$0.40 upon the exercise of unquoted options granted in connection with a capital raising transaction. |
| ● | On September 9, 2025, we issued 338,096 ordinary shares at an issue price of A$1.05 in a placement to institutional and individual investors. |
| ● | On September 11, 2025, we issued 190,000 ordinary shares at an issue price of A$0.25 upon the exercise of unquoted options granted in connection with a capital raising transaction. |
| ● | On October 10, 2025, we issued 47,619 ordinary shares at an issue price of A$1.05 in placement to directors (Cadell Buss (28,571) and Alexander Shaw (19,048)). |
| ● | On October 21, 2025, we issued 180,250 ordinary shares at an issue price of A$0.30 upon the exercise of unquoted options granted in connection with a capital raising transaction. |
| ● | On October 31, 2025, we issued 3,891,666 ordinary shares at an issue price of A$1.20 in a placement to institutional and individual investors. |
| ● | On November 5, 2025, we issued 1,087,667 ordinary shares at an issue price of A$1.20 in a placement to institutional and individual investors. |
| ● | On November 6, 2025, we issued 18,250 ordinary shares at an issue price of A$0.25 upon the exercise of unquoted options granted in connection with a capital raising transaction. |
| ● | On November 7, 2025 we issued 7,500,000 ordinary shares upon the exercise of Class A performance rights by Luso Global Mining BV. |
| ● | On November 20, 2025, we issued 180,249 ordinary shares at an issue price of A$0.40 upon the exercise of unquoted options granted in connection with a capital raising transaction. |
| ● | On November 27, 2025, we issued 56,250 ordinary shares at an issue price of A$0.30 upon the exercise of unquoted options granted in connection with a capital raising transaction. |
| ● | On January 15, 2026, we issued 28,146 ordinary shares at an issue price of A$0.25 upon the exercise of unquoted options granted in connection with a capital raising transaction. |
| ● | On January 19, 2026, we issued 1,708,527 ordinary shares at an issue price of A$1.20 in a placement to directors and related parties (Cadell Buss (16,667), José Martins (191,860) and Mota Gestão e Participações SGPS SA (1,500,000)). |
| ● | On February 19, 2026, we issued 8,042 ordinary shares at an issue price of A$0.25, 55,146 ordinary shares at an issue price of A$0.40 upon the exercise of unquoted options granted in connection with a capital raising transaction. |
| ● | On May 21, 2026, we issued 48,250 ordinary shares at an issue price of A$0.25 and 30,537 ordinary shares at an issue price of A$0.40 upon the exercise of unquoted options granted in connection with a capital raising transaction |
None of the foregoing transactions involved any underwriter, underwriting discounts or commissions, or any public offering. The recipients of the securities in each of these transactions represented their intentions to acquire the securities for investment only and not with a view to or for sale in connection with any distribution thereof, and appropriate legends were placed on the share certificates issued in these transactions. All recipients had adequate access, through their relationships with us, to information about us. The sales of these securities were made without any general solicitation or advertising.
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ITEM 8. Exhibits and Financial Statement Schedules.
| (a) | Exhibits |
| # | previously filed |
ITEM 9. Undertakings.
The undersigned Registrant hereby undertakes to provide to the underwriter at the closing specified in the underwriting agreement, certificates in such denominations and registered in such names as required by the underwriter to permit prompt delivery to each purchaser.
Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers and controlling persons of the Registrant pursuant to the foregoing provisions, or otherwise, the Registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Securities Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the Registrant of expenses incurred or paid by a director, officer or controlling person of the Registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the Registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Securities Act and will be governed by the final adjudication of such issue.
The undersigned Registrant hereby undertakes that:
| (1) | For purposes of determining any liability under the Securities Act of 1933, the information omitted from the form of prospectus filed as part of this Registration Statement in reliance upon Rule 430A and contained in a form of prospectus filed by the Registrant pursuant to Rule 424(b)(1) or (4) or 497(h) under the Securities Act shall be deemed to be part of this Registration Statement as of the time it was declared effective. |
| (2) | For the purpose of determining any liability under the Securities Act of 1933, each post-effective amendment that contains a form of prospectus shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. |
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Pursuant to the requirements of the Securities Act of 1933, as amended, the registrant certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form F-1 and has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized in Perth, Australia on August 20, 2026.
| Chilwa Minerals Limited | ||
| By: | /s/ Cadell Buss | |
| Name: | Cadell Buss | |
| Title: | Chief Executive Officer and Managing Director | |
Pursuant to the requirements of the Securities Act of 1933, as amended, this Amendment No. 2 to the registration statement has been signed by the following persons on behalf of the registrant and in the capacities and on the dates indicated:
| Signature | Title | Date | ||
| /s/ Cadell Buss | Chief Executive Officer and Managing Director | August 20, 2026 | ||
| Cadell Buss | (principal executive officer) | |||
| /s/ Mark Laybourn | Chief Financial Officer | August 20, 2026 | ||
| Mark Laybourn | (principal financial
officer and principal accounting officer) |
|||
| * | Chairman | August 20, 2026 | ||
| Alexander Shaw | ||||
| * | Director | August 20, 2026 | ||
| Manuel Mota | ||||
| * | Director | August 20, 2026 | ||
| José Martins | ||||
| * | Director | August 20, 2026 | ||
| Graham Hewson |
| *By: | /s/ Cadell Buss | |
| Cadell Buss | ||
| Attorney-in-fact |
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Signature of Authorized U.S. Representative of the Registrant
Pursuant to the requirements of the Securities Act of 1933, as amended, the undersigned, the duly authorized representative in the United States of Chilwa Minerals Limited, has signed this Amendment No. 2 to the Registration Statement on August 20, 2026.
| By: | /s/ Donald J. Puglisi | |
| Name: | Donald J. Puglisi | |
| Title: | Managing Director |
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Exhibit 1.1
_________ AMERICAN DEPOSITARY SHARES
EACH REPRESENTING 10 ORDINARY SHARES AND
_____________ WARRANTS
CHILWA MINERALS LIMITED
UNDERWRITING AGREEMENT
_______, 2026
Maxim Group LLC
300 Park Avenue, 16th Floor
New York, NY 10022
As the Representative of the
Several underwriters, if any, named in Schedule I hereto
Ladies and Gentlemen:
The undersigned, Chilwa Minerals Limited, a company incorporated under the laws of Australia (collectively with its subsidiaries and affiliates, including, without limitation, all entities disclosed or described in the Registration Statement (as defined below) as being subsidiaries or affiliates of Chilwa Minerals Limited, the “Company”), hereby confirms its agreement (this “Agreement”) with the several underwriters (such underwriters, including the Representative (as defined below), the “Underwriters” and each an “Underwriter”) named in Schedule I hereto for which Maxim Group LLC is acting as representative to the several Underwriters (the “Representative” and if there are no Underwriters other than the Representative, references to multiple Underwriters shall be disregarded and the term Representative as used herein shall have the same meaning as Underwriter) on the terms and conditions set forth herein. The Underlying Ordinary Shares (as defined below) are to be deposited pursuant to a deposit agreement dated on or about the date hereof (the “Deposit Agreement”), among the Company, The Bank of New York Mellon, as depositary (the “Depositary”), and holders and beneficial holders from time to time of the ADRs, if any, issued by the Depositary and evidencing the ADSs (as defined below). Each ADS will initially represent ten (10) Ordinary Shares (as defined below) deposited pursuant to the Deposit Agreement.
It is understood that the several Underwriters are to make a public offering of the Public Securities (as defined below) as soon as the Representative deems it advisable to do so. The Public Securities are to be initially offered to the public at the initial public offering price set forth in the Prospectus (as defined below).
It is further understood that you will act as the Representative for the Underwriters in the offering and sale of the Closing Securities (as defined below) and, if any, the Option Securities (as defined below) in accordance with this Agreement.
ARTICLE I.
DEFINITIONS
1.1 Definitions. In addition to the terms defined elsewhere in this Agreement, for all purposes of this Agreement, the following terms have the meanings set forth in this Section 1.1:
“ADRs” means the American Depositary Receipts issued by the Depositary and evidencing the ADSs.
“ADSs” means the American Depositary Shares of the Company, each ADS initially representing ten (10) Ordinary Shares.
“ADS Registration Statement” shall have the meaning ascribed to such term in Section 3.1(g).
“Affiliate” means with respect to any Person, any other Person that, directly or indirectly through one or more intermediaries, controls or is controlled by or is under common control with such Person as such terms are used in and construed under Rule 405 under the Securities Act.
“Applicable Laws” means all applicable laws, rules, regulations, policies, statutes, ordinances, codes, orders, consents, decrees, judgments, decisions, rulings, awards, guidelines, or the terms and conditions of any Authorizations, including any judicial or administrative interpretation thereof, of any Governmental Authority, including for certainty with respect to all Environmental Laws.
“ASIC” shall mean the Australian Securities and Investments Commission.
“ASX” means ASX Limited (ACN 008 624 691) or the financial market known as the Australian Securities Exchange, as the context requires.
“ASX Listing Rules” means the listing rules of the ASX.
“Australian Securities Laws” shall have the meaning ascribed to such term in Section 3.1(t).
“Authorizations” means any regulatory licenses, approvals, permits, consents, certificates, registrations, filings or other authorizations of or issued by any Governmental Authority under Applicable Laws.
“Board of Directors” means the board of directors of the Company.
“Business Day” means any day other than Saturday, Sunday or other day on which commercial banks in The City of New York are authorized or required by law to remain closed; provided, however, for clarification, commercial banks shall not be deemed to be authorized or required by law to remain closed due to “stay at home”, “shelter-in-place”, “non-essential employee” or any other similar orders or restrictions or the closure of any physical branch locations at the direction of any governmental authority so long as the electronic funds transfer systems (including for wire transfers) of commercial banks in The City of New York generally are open for use by customers on such day.
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“Cleansing Document” means either (i) a ‘cleansing statement’ prepared and lodged in accordance with section 708A(5)(e) of the Corporations Act; or (ii) a ‘cleansing prospectus’ prepared and lodged in accordance with section 708A(11) of the Corporations Act.
“Closing” means the closing of the purchase and sale of the Closing Securities pursuant to Section 2.1.
“Closing ADSs” shall have the meaning ascribed to such term in Section 2.1(a).
“Closing Date” means the hour and the date on the Trading Day on which all conditions precedent to (i) the Underwriters’ obligations to pay the Closing Purchase Price and (ii) the Company’s obligations to deliver the Closing ADSs, in each case, have been satisfied or waived, but in no event later than 10:00 a.m. (New York City time) on the [first or third] Trading Day following the date hereof (or the [second or fourth] Trading Day following the date hereof if this Agreement is signed on a day that is not a Trading Day or after 4:00 p.m. (New York City time) on a Trading Day) or at such earlier time as shall be agreed upon by the Representative and the Company.
“Closing Ordinary Shares” means the Ordinary Shares to be delivered to the Depositary pursuant to the Deposit Agreement and underlying the Closing ADSs.
“Closing Purchase Price” shall have the meaning ascribed to such term in Section 2.1(b), which aggregate purchase price shall be net of the underwriting discounts and commissions.
“Closing Securities” shall have the meaning ascribed to such term in Section 2.1(a)(ii).
“Combined Purchase Price” shall have the meaning ascribed to such term in Section 2.1(a).
“Commission” means the United States Securities and Exchange Commission.
“Company Auditor” means BDO Audit Pty Ltd, with offices located at Level 18, 360 Queen Street, Brisbane QLD 4000, Australia.
“Company Australian Counsel” means Atkinson Corporate Lawyers, with offices in Perth, Australia.
“Company U.S. Counsel” means Rimôn Law, with offices located at Level 2, 50 Bridge Street, Sydney, NSW 2000, Australia.
“Corporations Act” means Corporations Act 2001 of the Commonwealth of Australia
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“Deposit Agreement” means the deposit agreement, dated on or about the date hereof, among the Company, the Depositary and all owners and holders (as defined therein) from time to time of ADSs.
“Depositary” means The Bank of New York Mellon, as depositary under the Deposit Agreement.
“Effective Date” shall have the meaning ascribed to such term in Section 3.1(g).
“EGS” means Ellenoff Grossman & Schole LLP, with offices located at 1345 Avenue of the Americas, New York, New York 10105.
“Exchange Act” means the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder.
“Execution Date” shall mean the date on which the parties execute and enter into this Agreement.
“Exempt Issuance” means the issuance of (a) Ordinary Shares or options to employees, officers or directors of the Company pursuant to any stock or option plan in effect on the date of this Agreement or duly adopted for such purpose, by a majority of the non-employee members of the Board of Directors or a majority of the members of a committee of non-employee directors established for such purpose for services rendered to the Company, (b) the Representative’s Warrant (as defined below) and the Representative’s Warrant ADSs (as defined below), (c) securities upon the exercise or exchange of or conversion of any Securities issued hereunder and/or other securities exercisable or exchangeable for or convertible into Ordinary Shares issued and outstanding on the date of this Agreement, provided that such securities have not been amended since the date of this Agreement to increase the number of such securities or to decrease the exercise price, exchange price or conversion price of such securities or to extend the term of such securities, and (d) securities issued pursuant to acquisitions or strategic transactions approved by a majority of the disinterested directors of the Company, provided that such securities are issued as “restricted securities” (as defined in Rule 144) and carry no registration rights that require or permit the filing of any registration statement during the prohibition period in Section 4.21(a) herein in connection therewith, and provided that any such issuance shall only be to a Person (or to the equity holders of a Person) which is, itself or through its subsidiaries, an operating company or an owner of an asset in a business synergistic with the business of the Company and shall provide to the Company additional benefits in addition to the investment of funds, but shall not include a transaction in which the Company is issuing securities primarily for the purpose of raising capital or to an entity whose primary business is investing in securities.
“FCPA” means the United States Foreign Corrupt Practices Act of 1977, as amended.
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“FINRA” means the Financial Industry Regulatory Authority.
“General Disclosure Package” shall have the meaning ascribed to such term in Section 3.1(aa).
“IFRS” shall have the meaning ascribed to such term in Section 3.1(j).
“Indebtedness” means (a) any liabilities for borrowed money or amounts owed in excess of $50,000 (other than trade accounts payable incurred in the ordinary course of business), (b) all guaranties, endorsements and other contingent obligations in respect of indebtedness of others, whether or not the same are or should be reflected in the Company’s consolidated balance sheet (or the notes thereto), except guaranties by endorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business; and (c) the present value of any lease payments in excess of $50,000 due under leases required to be capitalized in accordance with IFRS.
“Investor Warrants” means the ADS purchase warrants delivered to the investors in the Offering, other than the Representative’s Warrant, which shall be exercisable immediately and have a term of exercise equal to 5 years, in the form attached as Annex A to the Warrant Agent Agreement.
“Issuer-Represented Free Writing Prospectus” means any “issuer free writing prospectus,” as defined in Rule 433 under the Securities Act, relating to the Securities that (A) is required to be filed with the Commission by the Company, or (B) is exempt from filing pursuant to Rule 433(d)(5)(i) under the Securities Act because it contains a description of the Securities or of the Offering that does not reflect the final terms or pursuant to Rule 433(d)(8)(ii) because it is a “bona fide electronic road show,” as defined in Rule 433 under the Securities Act, in each case in the form filed or required to be filed with the Commission or, if not required to be filed, in the form retained in the Company’s records pursuant to Rule 433(g) under the Securities Act; provided, however, that a Written Testing-the-Waters Communication shall be deemed not to be an Issuer Free Writing Prospectus.
“Issuer-Represented General Free Writing Prospectus” means any Issuer-Represented Free Writing Prospectus that is intended for general distribution to prospective investors, as evidenced by its being specified in Exhibit A to this Agreement.
“Issuer-Represented Limited-Use Free Writing Prospectus” means any Issuer-Represented Free Writing Prospectus that is not an Issuer-Represented General Free Writing Prospectus. The term Issuer-Represented Limited-Use Free Writing Prospectus also includes any “bona fide electronic road show,” as defined in Rule 433 under the Securities Act, that is made available without restriction pursuant to Rule 433(d)(8)(ii), even though not required to be filed with the Commission.
“Liens” means a lien, charge, pledge, security interest, encumbrance, right of first refusal, preemptive right or other restriction.
“Lock-Up Agreements” means the lock-up agreements that are delivered on the date hereof by each of the Company’s officers and directors and the Company’s major shareholder, in the form of Exhibit B.
“Material Adverse Effect” means (i) a material adverse effect on the legality, validity or enforceability of any Transaction Document, (ii) a material adverse effect on the results of operations, assets, business, prospects or condition (financial or otherwise) of the Company and the Subsidiaries, taken as a whole or (iii) a material adverse effect on the Company’s ability to perform in any material respect on a timely basis its obligations under any Transaction Document.
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“Material Property” means the Chilwa Critical Minerals Project property located in southern Malawi along the shores of Lake Chilwa.
“Offering” shall have the meaning ascribed to such term in Section 2.1(c).
“Option ADSs” shall have the meaning ascribed to such term in Section 2.2(a).
“Option Closing Date” shall have the meaning ascribed to such term in Section 2.2(c).
“Option Closing Purchase Price” shall have the meaning ascribed to such term in Section 2.2(b), which aggregate purchase price shall be net of the underwriting discounts and commissions.
“Option Ordinary Shares” means the Ordinary Shares to be delivered to the Depositary pursuant to the Deposit Agreement and underlying the Option ADSs.
“Option Securities” shall have the meaning ascribed to such term in Section 2.2(a).
“Option Warrants” shall have the meaning ascribed to such term in Section 2.2(a).
“Ordinary Shares” means the fully paid ordinary shares of the Company, no par value, and any other class of securities into which such securities may hereafter be reclassified or changed.
“Ordinary Share Equivalents” means any securities of the Company or the Subsidiaries which would entitle the holder thereof to acquire at any time Ordinary Shares or ADSs, including, without limitation, any debt, preferred stock, right, option, warrant or other instrument that is at any time convertible into or exercisable or exchangeable for, or otherwise entitles the holder thereof to receive, Ordinary Shares.
“Over-Allotment Option” shall have the meaning ascribed to such term in Section 2.2(a).
“Person” means an individual or corporation, partnership, trust, incorporated or unincorporated association, joint venture, limited liability company, joint stock company, government (or an agency or subdivision thereof) or other entity of any kind.
“Preliminary Prospectus” means, if any, any preliminary prospectus relating to the Securities included in the Registration Statement or filed with the Commission pursuant to Rule 424(b).
“Proceeding” means an action, claim, suit, investigation or proceeding (including, without limitation, an informal investigation or partial proceeding, such as a deposition), whether commenced or threatened.
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“Prospectus” means the final prospectus filed for the Registration Statement complying with Rule 430A and Rule 424(b) of the Securities Act that is filed with the Commission and any supplement to the final prospectus filed thereafter.
“Public ADSs” means, collectively, the Closing ADSs and, if any, the Option ADSs.
“Public Securities” means, collectively, the Closing Securities and, if any, the Option Securities.
“Registration Statement” means, collectively, the various parts of the registration statement prepared by the Company on Form F-1 (File No. 333-297336) with respect to the Securities, each as amended as of the date hereof, including the Prospectus, any Preliminary Prospectus and all exhibits filed with or incorporated by reference into such registration statement, and includes any Rule 462(b) Registration Statement.
“Representative’s Warrant” means the ADS purchase warrants delivered to the Underwriters in accordance with Section 2.3(v), which Representative’s Warrant shall be exercisable immediately and have a term of exercise equal to 5 years, in the form of Exhibit C attached hereto.
“Required Approvals” shall have the meaning ascribed to such term in Section 3.1(f).
“Rule 424” means Rule 424 promulgated by the Commission pursuant to the Securities Act, as such Rule may be amended or interpreted from time to time, or any similar rule or regulation hereafter adopted by the Commission having substantially the same purpose and effect as such Rule.
“Rule 462(b) Registration Statement” means any registration statement prepared by the Company registering additional Securities, which was filed with the Commission on or prior to the date hereof and became automatically effective pursuant to Rule 462(b) promulgated by the Commission pursuant to the Securities Act.
“Securities” means the Public Securities, the Representative’s Warrant and the Representative’s Warrant ADSs.
“Securities Act” means the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder.
“Subsidiary” means any subsidiary of the Company and shall, where applicable, also include any direct or indirect subsidiary of the Company formed or acquired after the date hereof.
“Statutory Prospectus” as of any time means the prospectus that is included in the Registration Statement immediately prior to that time. For purposes of this definition, information contained in a form of prospectus that is deemed retroactively to be a part of the Registration Statement pursuant to Rule 430A or 430B under the Securities Act shall be considered to be included in the Statutory Prospectus as of the actual time that form of prospectus is filed with the Commission pursuant to Rule 424(b) under the Securities Act.
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“Testing-the-Waters Communication” means any oral or written communication with potential investors in reliance on Section 5(d) of the Securities Act.
“Time of Sale” means [__] p.m. (Eastern time) on the Execution Date.
“Trading Day” means a day on which the principal Trading Market in the United States is open for trading.
“Trading Market” means any of the following markets or exchanges on which the Ordinary Shares or ADSs are listed or quoted for trading on the date in question: the ASX, the NYSE American, the Nasdaq Capital Market, the Nasdaq Global Market, the Nasdaq Global Select Market, or the New York Stock Exchange (or any successors to any of the foregoing).
“Transaction Documents” means this Agreement, the Warrants, the Warrant Agency Agreement, the Representative’s Warrant, the Deposit Agreement, and any other documents or agreements executed in connection with the transactions contemplated hereunder.
“Transfer Agent” means The Bank of New York Mellon with offices located at 240 Greenwich Street, New York, New York 10286, and any successor transfer agent of the Company.
“Underlying Ordinary Shares” means, collectively, the Closing Ordinary Shares, the Option Ordinary Shares, Warrant Ordinary Shares and the Representative’s Warrant Ordinary Shares.
“Warrant ADSs” means the ADSs issuable upon exercise of the Investor Warrants and/or the Representative’s Warrant.
“Warrant Agency Agreement” means the warrant agency agreement dated on or about the date hereof, among the Company and Computershare Inc. in the form of Exhibit D attached hereto.
“Warrant Ordinary Shares” means the Ordinary Shares delivered to the Depositary and underlying the Warrant ADSs.
“Warrant Purchase Price” shall have the meaning ascribed to such term in Section 2.1(b).
“Written Testing-the-Waters Communication” means any Testing-the-Waters Communication that is a written communication within the meaning of Rule 405 under the Securities Act.
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ARTICLE II.
PURCHASE AND SALE
2.1 Closing.
(a) Upon the terms and subject to the conditions set forth herein, the Company agrees to, through the issue of Ordinary Shares to the Depositary which will be held by the Depositary under the Deposit Agreement, sell in the aggregate [__] ADSs and Investor Warrants exercisable for an aggregate of _____ ADSs, and each Underwriter agrees to purchase, severally and not jointly, at the Closing, the follow securities of the Company:
(i) the number of ADSs (the “Closing ADSs”) set forth opposite the name of such Underwriter on Schedule I hereof; and
(ii) the number of Investor Warrants set forth opposite the name of such Underwriter on Schedule I hereof (the “Closing Warrants” and, collectively with the Closing ADSs, the “Closing Securities”).
(b) The aggregate purchase price for the Closing Securities shall equal the amount set forth opposite the name of such Underwriter on Schedule I hereto (the “Closing Purchase Price”), which will represent the aggregate price of the Closing Securities at their respective prices discussed below. The combined purchase price for one ADS and one Warrant $[_____] with respect to ADSs and Investor Warrants issued to Company Investors (as defined below) and the combined purchase price for one ADS and one Warrant shall be $[__] with respect to ADSs and Warrant sold to all other investors. For the purposes hereof, the term “Company Investors” means investors that are contacts, or from existing relationships, of the Company or any officer of the Company, as set forth in Schedule II; and
(c) On the Closing Date, each Underwriter shall deliver or cause to be delivered to the Company, via wire transfer, immediately available funds equal to such Underwriter’s Closing Purchase Price and the Company shall concurrently deliver to, or as directed by, such Underwriter its respective Closing Securities or the related ADRs, as the case may be, and the Company shall deliver the other items required pursuant to Section 2.3 deliverable at the Closing. Upon satisfaction of the covenants and conditions set forth in Sections 2.3 and 2.4, the Closing shall occur at the offices of EGS or such other location as the Company and Representative shall mutually agree. The Public Securities are to be offered initially to the public at the offering price set forth on the cover page of the Prospectus (the “Offering”).
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2.2 Over-Allotment Option.
(a) For the purposes of covering any over-allotments in connection with the distribution and sale of the Closing Securities, the Representative is hereby granted an option (the “Over-Allotment Option”) to purchase, in the aggregate, up to [__]additional ADSs (the “Option ADSs”) and up to [ ] Warrants (the “Option Warrants” and, collectively with the Option ADSs, the “Option Securities”) which may be purchased in any combination of Option Shares and/or Option Warrants at the ADS Purchase Price and/or Warrant Purchase Price (each defined below), respectively. For this section, $[__] per ADS shall be the “ADS Purchase Price” and $[____] per Warrant shall be the “Warrant Purchase Price”).
(b) In connection with an exercise of the Over-Allotment Option, the purchase price to be paid for the Option ADSs (“Option ADS Purchase Price”) is equal to the product of the ADS Purchase Price multiplied by the number of Option ADSs to be purchased and the purchase price to be paid for the Option Warrants (“Option Warrant Purchase Price”) is equal to the product of the Warrant Purchase Price multiplied by the number of Option Warrants to be purchased (the sum of the Option ADS Purchase Price and the Option Warrant Purchase Price to be paid on an Option Closing Date, the “Option Closing Purchase Price”).
(c) The Over-Allotment Option granted pursuant to this Section 2.2 may be exercised by the Representative as to all (at any time) or any part (from time to time) of the Option Securities within 45 days after the Execution Date. An Underwriter will not be under any obligation to purchase any Option Securities prior to the exercise of the Over-Allotment Option by the Representative. The Over-Allotment Option granted hereby may be exercised by the giving of oral notice to the Company from the Representative, which must be confirmed in writing by overnight mail or facsimile or other electronic transmission setting forth the number of Option ADSs and/or Option Warrants to be purchased and the date and time for delivery of and payment for such Option Securities (each, an “Option Closing Date”), which will not be later than one (1) full Business Day after the date of the notice or such other time as shall be agreed upon by the Company and the Representative, at the offices of EGS or at such other place (including remotely by facsimile or other electronic transmission) as shall be agreed upon by the Company and the Representative. If such delivery and payment for the Option Securities does not occur on the Closing Date, each Option Closing Date will be as set forth in the notice. Upon exercise of the Over-Allotment Option, the Company will become obligated to convey to the Underwriters, and, subject to the terms and conditions set forth herein, the Underwriters will become obligated to purchase, the number of Option ADSs and/or Option Warrants specified in such notice. The Representative may cancel the Over-Allotment Option at any time prior to the expiration of the Over-Allotment Option by written notice to the Company.
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2.3 Deliveries. The Company shall deliver or cause to be delivered to each Underwriter (if applicable) the following:
(i) At the Closing Date, the Closing ADSs and, as to each Option Closing Date, if any, the applicable Option ADSs, which shall be delivered via The Depository Trust Company Deposit or Withdrawal at Custodian system for the accounts of the several Underwriters;
(ii) At the Closing Date, the Closing Warrants and, as to each Option Closing Date, if any, the applicable Option Warrants via The Depository Trust Company Deposit or Withdrawal at Custodian system for the accounts of the several Underwriters in the name or names and in such authorized denominations as the applicable Underwriter may request in writing at least one Business Day prior to the Closing Date and, if any, each Option Closing Date;
(iii) At the Closing Date and at each Option Closing Date, if any, a copy of the irrevocable instruction to the Depositary instructing the Depositary to deliver on an expedited basis via The Depository Trust Company Deposit or Withdrawal at Custodian system the amount of applicable Public ADSs in the accounts of the several Underwriters;
(iv) At the Closing Date, the Warrant Agency Agreement duly executed by the parties thereto;
(v) At the Closing Date, and each Option Closing Date, as applicable, to the Representative or its permitted designees, a warrant (the “Representative’s Warrant”) to purchase up to a number of ADSs (the “Representative’s Warrant ADSs” and the Ordinary Shares delivered to the Depositary and underlying the Representative’s Warrant ADSs, the “Representative’s Warrant Ordinary Shares”) equal to 5% of the Closing ADSs and Option ADSs, as applicable, issued on the Closing Date and Option Closing Date, which Representative’s Warrant shall have an exercise price of $[__], subject to adjustment therein (for the avoidance of doubt, other than the method of assignment, the Representative’s Warrant will be in substantially the form of Exhibit C attached hereof);
(vi) At the Closing Date and each Option Closing Date, a legal opinion of Company U.S. Counsel and a negative assurance letter, addressed to the Underwriters, in form and substance reasonably acceptable to the Representative;
(vii) At the Closing Date and each Option Closing Date, a legal opinion of Company Australian Counsel addressed to the Underwriters, in form and substance reasonably acceptable to the Representative;
(viii) At the Closing Date and each Option Closing Date, a title opinion of Sacranie, Gow & Company, addressed to the Underwriters, in form and substance reasonably acceptable to the Representative;
(ix) At the Closing Date and each Option Closing Date, an opinion from, Emmet, Marvin & Martin, LLP counsel to the Depositary, addressed to the Underwriters, in form and substance reasonably acceptable to the Representative;
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(x) At the Closing Date, the Depositary shall have furnished or caused to be furnished to the Representative a certificate reasonably satisfactory to the Representative of one of its authorized officers with respect to the deposit with it of the Underlying Ordinary Shares, the issuance of the ADRs evidencing the Ordinary Shares delivered in the form of the ADSs, the execution, issuance, countersignature and delivery of the ADRs evidencing the Ordinary Shares delivered in the form of such ADSs pursuant to the Deposit Agreement and such other customary matters related thereto as the Representative may reasonably request;
(xi) On or prior to the Closing Date, the Company and the Depositary shall have executed and delivered the Deposit Agreement and the Deposit Agreement shall be in full force and effect;
(xii) Contemporaneously herewith, a cold comfort letter, addressed to the Underwriters and in form and substance satisfactory in all respects to the Representative from the Company Auditor dated, respectively, as of the date of this Agreement and a bring-down letter dated as of the Closing Date and each Option Closing Date, if any;
(xiii) On the Closing Date and on each Option Closing Date, the duly executed and delivered Officer’s Certificate, in form and substance reasonably acceptable to the Representative;
(xiv) On the Closing Date and on each Option Closing Date, the duly executed and delivered Secretary’s Certificate, in form and substance reasonably acceptable to the Representative;
(xv) On the Closing Date and on each Option Closing Date, the duly executed and delivered Chief Financial Officer’s Certificate, in form and substance reasonably acceptable to the Representative; and
(xvi) Contemporaneously herewith, the duly executed and delivered Lock-Up Agreements.
2.4 Closing Conditions. The respective obligations of each Underwriter hereunder in connection with the Closing and each Option Closing Date are subject to the following conditions being met:
(i) the accuracy in all material respects when made and on the date in question (other than representations and warranties of the Company already qualified by materiality, which shall be true and correct in all respects) of the representations and warranties of the Company contained herein (unless as of a specific date therein);
(ii) all obligations, covenants and agreements of the Company required to be performed at or prior to the date in question shall have been performed;
(iii) the delivery by the Company of the items set forth in Section 2.3 of this Agreement;
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(iv) the Prospectus (which may be delivered in accordance with Rule 172 under the Securities Act) shall have been filed with the Commission in accordance with the Rules and Regulations;
(v) the Registration Statement and the ADS Registration Statement shall each be effective on the date of this Agreement and at each of the Closing Date and each Option Closing Date, if any, no stop order suspending the effectiveness of the Registration Statement or the ADS Registration Statement shall have been issued and no proceedings for that purpose shall have been instituted or shall be pending or contemplated by the Commission and any request on the part of the Commission for additional information shall have been complied with to the reasonable satisfaction of the Representative;
(vi) by the Execution Date, the Underwriters shall have received clearance from FINRA as to the underwriting terms and arrangements and amount of compensation allowable or payable to the Underwriters as described in the Registration Statement;
(vii) the Company shall have received confirmation that the Public ADSs, Warrant ADSs and the Representative’s Warrant ADSs have been accepted for listing on The Nasdaq Stock Market and ASX shall not have indicated to the Company that it will not grant official quotation to the Underlying Ordinary Shares;
(viii) prior to and on each of the Closing Date and each Option Closing Date, if any: (i) there shall have been no material adverse change or development involving a prospective material adverse change in the condition or prospects or the business activities, financial or otherwise, of the Company from the latest dates as of which such condition is set forth in the Registration Statement, the General Disclosure Package and the Prospectus; (ii) no action suit or proceeding, at law or in equity, shall have been pending or threatened against the Company or any Affiliate of the Company before or by any court or federal or state commission, board or other administrative agency wherein an unfavorable decision, ruling or finding may materially adversely affect the business, operations, prospects or financial condition or income of the Company, except as set forth in the Registration Statement, General Disclosure Package, ADS Registration Statement and Prospectus; (iii) no stop order shall have been issued under the Securities Act and no proceedings therefor shall have been initiated or threatened by the Commission; (iv) no order shall have been issued preventing the issue of the Underlying Ordinary Shares under the Corporations Act or other applicable legislation and no proceedings therefor shall have been initiated or threatened by ASIC; and (iv) the Registration Statement, the General Disclosure Package and the Prospectus and any amendments or supplements thereto shall contain all material statements which are required to be stated therein in accordance with the Securities Act and the rules and regulations thereunder and shall conform in all material respects to the requirements of the Securities Act and the rules and regulations thereunder, and neither the Registration Statement, the General Disclosure Package and the Prospectus nor any amendment or supplement thereto shall contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading; and
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(ix) except for any trading halt on the ASX for the Ordinary Shares that may be necessary in connection with this Offering, trading in the ADSs and/or Ordinary Shares shall not have been suspended by the Commission or the Company’s principal Trading Market with respect to such security, and, at any time prior to the Closing Date or Option Closing, if applicable, trading in securities generally as reported by Bloomberg L.P. shall not have been suspended or limited, or minimum prices shall not have been established on securities whose trades are reported by such service, or on any Trading Market, nor shall a banking moratorium have been declared either by Australian, the United States or New York State authorities nor shall there have occurred any material outbreak or escalation of hostilities or other national or international calamity of such magnitude in its effect on, or any material adverse change in, any financial market which, in each case, in the reasonable judgment of such Purchaser, makes it impracticable or inadvisable to purchase the Public ADSs at the Closing or Option Closing, if applicable.
ARTICLE III.
REPRESENTATIONS AND WARRANTIES
3.1 Representations and Warranties of the Company. The Company represents and warrants to the Underwriters as of the Execution Date, as of the Closing Date and as of each Option Closing Date, if any, as follows:
(a) Subsidiaries. All of the direct and indirect Subsidiaries of the Company are set forth in the Registration Statement, the General Disclosure Package and the Prospectus (the “Subsidiaries” and each a “Subsidiary”). The Company owns, directly or indirectly, all of the capital stock or other equity interests of each Subsidiary free and clear of all liens, and all of the issued and outstanding shares of capital stock of each Subsidiary are validly issued and are fully paid, non-assessable (to the extent such concept exists under applicable law) and free of preemptive and similar rights to subscribe for or purchase securities.
(b) Organization and Qualification. The Company is an Australian public company and has been duly incorporated and is validly existing under the laws of the Commonwealth of Australia, with corporate power and authority to own, lease and operate its properties and conduct its business as described in the Registration Statement, the General Disclosure Package and the Prospectus, and has been duly qualified as a foreign corporation for the transaction of business and is in good standing under the laws of each other jurisdiction in which it owns or leases properties or conducts any business so as to require such qualification, or is subject to material liability or disability by reason of the failure to be so qualified in any such jurisdiction, except where such failure to be so qualified would not have a Material Adverse Effect; and each Subsidiary of the Company listed in the Registration Statement, the General Disclosure Package and the Prospectus has been duly incorporated and is validly existing as a corporation in good standing under the laws of its jurisdiction of incorporation, with corporate power and authority to own, lease and operate its properties and conduct its business as described in the Registration Statement, the General Disclosure Package and the Prospectus, and has been duly qualified as a foreign corporation for the transaction of business and is in good standing under the laws of each other jurisdiction in which it owns or leases properties or conducts any business so as to require such qualification, or is subject to no material liability or disability by reason of the failure to be so qualified in any such jurisdiction, except where such failure to be so qualified would not have a Material Adverse Effect; as of the date of this Agreement, except for the entities listed in the Registration Statement, the General Disclosure Package and the Prospectus, the Company does not own or control, directly or indirectly, any equity or other ownership interest in any corporation, partnership, joint venture or any other Person.
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(c) Authorization; Enforcement. The Company has the requisite corporate power and authority to enter into and to consummate the transactions contemplated by this Agreement and each of the other Transaction Documents to which it is a party and otherwise to carry out its obligations hereunder and thereunder. The execution and delivery of this Agreement and each of the other Transaction Documents by the Company and the consummation by it of the transactions contemplated hereby and thereby have been duly authorized by all necessary action on the part of the Company and no further action is required by the Company, the Board of Directors or the Company’s stockholders (including under the Corporations Act, the ASX Listing Rules and the Company’s constitution) in connection herewith or therewith other than in connection with the Required Approvals. This Agreement and each other Transaction Document to which the Company is a party has been (or upon delivery will have been) duly executed by the Company and, when delivered in accordance with the terms hereof and thereof, will constitute the valid and binding obligation of the Company enforceable against the Company in accordance with its terms, except (i) as limited by general equitable principles and applicable bankruptcy, insolvency, reorganization, moratorium and other laws of general application affecting enforcement of creditors’ rights generally, (ii) as limited by laws relating to the availability of specific performance, injunctive relief or other equitable remedies and (iii) insofar as indemnification and contribution provisions may be limited by applicable law. The Registration Statement, General Disclosure Package and the Prospectus and all filings or announcements to be made with ASIC or ASX in relation to the Company’s obligations under this Agreement have been duly authorized by and on behalf of the Company.
(d) Authorization of Deposit Agreement. The Deposit Agreement has been duly authorized by the Company, and when executed and delivered by the Company will, assuming due authorization, execution and delivery by the Depositary, constitute a valid and legally binding obligation of the Company, enforceable against the Company in accordance with its terms, except as may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or other similar laws relating to or affecting creditors’ rights generally or general equitable principles. Upon the issuance, sale and payment for the Public ADSs in accordance with the terms hereof and the due issuance by the Depositary of the Public ADSs against the deposit of the Underlying Ordinary Shares in respect thereof in accordance with the provisions of the Deposit Agreement, such Public ADSs and Underlying Ordinary Shares will be duly and validly issued, and the persons in whose names the Public ADSs are registered will be entitled to the rights specified in the Deposit Agreement; and the Deposit Agreement and the ADSs conform in all material respects to the descriptions thereof contained in the Registration Statement, General Disclosure Package and the Prospectus. Upon the exercise of the Investor Warrants and Representative’s Warrant pursuant to their terms, the issuance, sale and payment for the Warrant ADSs in accordance with the terms hereof and the due issuance by the Depositary of the ADRs evidencing the ADSs underlying the Investor Warrants and Representative’s Warrant against the deposit of the Warrant Ordinary Shares in respect thereof in accordance with the provisions of the Deposit Agreement, such Warrant ADSs will be duly and validly issued, and the persons in whose names the Warrant ADSs are registered will be entitled to the rights specified in the Deposit Agreement; and the Deposit Agreement and the ADSs conform in all material respects to the descriptions thereof contained in the Registration Statement and the Prospectus. Upon the exercise of the Representative’s Warrant pursuant to their terms, the issuance, sale and payment for the Representative’s Warrant ADSs in accordance with the terms hereof and the due issuance by the Depositary of the ADRs evidencing the ADSs underlying the Representative’s Warrant against the deposit of the Representative’s Warrant Ordinary Shares in respect thereof in accordance with the provisions of the Deposit Agreement, such Representative’s Warrant ADSs will be duly and validly issued, and the persons in whose names the Representative’s Warrant ADSs are registered will be entitled to the rights specified in the Deposit Agreement; and the Deposit Agreement and the ADSs conform in all material respects to the descriptions thereof contained in the Registration Statement and the Prospectus. There has been no change in the Company’s agreement with the Depositary in connection with any pre-release of the Company’s ADSs and no such change is currently contemplated.
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(e) No Conflicts. The execution, delivery and performance by the Company of this Agreement and the other Transaction Documents to which it is a party, the issuance and sale of the Public Securities, the issuance of the Underlying Ordinary Shares upon conversion of the ADSs, the deposit of the Underlying Ordinary Shares with the Depositary against issuance of the ADRs evidencing the ADSs and compliance with the terms and provisions hereof and thereof and the use of proceeds as described in the Registration Statement, the General Disclosure Package and the Prospectus, and the consummation by the Company of the transactions contemplated hereby and thereby do not and will not (i) conflict with or violate any provision of the Company’s or any Subsidiary’s constitution, certificate or articles of incorporation, bylaws or other organizational or charter documents, or (ii) conflict with, violate or constitute a default (or an event that with notice or lapse of time or both would become a default) under, result in the creation of any Lien upon any of the properties or assets of the Company or any Subsidiary, or give to others any rights of termination, amendment, anti-dilution or similar adjustments, acceleration or cancellation (with or without notice, lapse of time or both) of, any agreement, credit facility, debt or other instrument (evidencing a Company or Subsidiary debt or otherwise) or other understanding to which the Company or any Subsidiary is a party or by which any property or asset of the Company or any Subsidiary is bound or affected, (iii) subject to the Required Approvals, conflict with or result in a violation of any law, rule, regulation, order, judgment, injunction, decree or other restriction of any court or governmental authority (each, a “Governmental Authority”) to which the Company or a Subsidiary is subject (including federal and state securities laws and regulations) or the ASX Listing Rules, or by which any property or asset of the Company or a Subsidiary is bound or affected or (iv) conflict with or result in a violation of any approval, consent, waiver, authorization, exemption, permission, endorsement or license granted by an Governmental Authority in Australia, the United States or any other jurisdiction where the Company or any Subsidiary was incorporated or operates or any ASX Listing Rule or any waiver granted by the ASX; except in the case of each of clauses (ii) and (iii), such as could not have or reasonably be expected to result in a Material Adverse Effect.
(f) Filings, Consents and Approvals. The Company is not required to obtain any consent, waiver, authorization, approval or order of, give any notice to, or make any filing or registration with, any court or other federal, state, local or other Governmental Authority or other Person (including ASX) in connection with the execution, delivery and performance by the Company of the Transaction Documents, including the issuance and listing of the Securities on the Trading Market and the Underlying Ordinary Shares on ASX, other than: (i) the filing with the Commission of the Prospectus, (ii) such filings as are required to be made under applicable state securities laws and the ASX Listing Rules; and (iii) the relief that the Company and the Representative are seeking from ASIC under sections 655A(1)(b) and 673(1)(b) of the Corporations Act in relation to the Lock-Up Agreements (collectively, the “Required Approvals”).
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(g) Registration Statement. The Company has filed with the Commission the Registration Statement, including any related Prospectus or Prospectuses, for the registration of the Securities under the Securities Act, which Registration Statement has been prepared by the Company in all material respects in conformity with the requirements of the Securities Act and the rules and regulations of the Commission under the Securities Act. The Registration Statement has been declared effective by the Commission on [___], 2026 (the “Effective Date”). The Company has filed with the Commission a Form 8-A (File Number 001-[___]) providing for the registration under the Exchange Act of the ADSs and the Ordinary Shares underlying the ADSs. The registration of the Closing ADSs, Warrant ADSs and the Option ADSs under the Exchange Act has been declared effective by the Commission on the date hereof. The Company has advised the Representative of all further information (financial and other) with respect to the Company required to be set forth therein in the Registration Statement and Prospectus. Any reference in this Agreement to the terms “amend,” “amendment” or “supplement” with respect to the Registration Statement, the Preliminary Prospectus or the Prospectus shall be deemed to refer to and include the issue date of the Preliminary Prospectus or the Prospectus, as the case may be, deemed to be incorporated therein by reference. All references in this Agreement to financial statements and schedules and other information which is “contained,” “included,” “described,” “referenced,” “set forth” or “stated” in the Registration Statement, the Preliminary Prospectus or the Prospectus (and all other references of like import) shall be deemed to mean and include all such financial statements and schedules and other information, if any, which is or is deemed to be incorporated by reference in the Registration Statement, the Preliminary Prospectus or the Prospectus, as the case may be. No stop order suspending the effectiveness of the Registration Statement or the use of the Prospectus has been issued, and no proceeding for any such purpose is pending or has been initiated or, to the Company’s knowledge, is threatened by the Commission. The Company will not, without the prior consent of the Representative, prepare, use or refer to, any free writing prospectus. For purposes of this Agreement, “free writing prospectus” has the meaning set forth in Rule 405 under the Securities Act. A registration statement on Form F-6 (No. 333-297366) covering the registration of the ADSs under the Securities Act has (i) been prepared by the Company and Depositary in conformity with the requirements of the Securities Act and the rules and regulations thereunder, (ii) been filed with the Commission under the Securities Act, and (iii) become effective under the Securities Act. As used in this Agreement, “ADS Registration Statement” means such registration statement, as amended at the time it became effective under the Securities Act, including all exhibits thereto. The Commission has not issued any order suspending the effectiveness of the ADS Registration Statement, and no Proceeding for that purpose has been instituted or, to the Company’s knowledge, threatened by the Commission. The ADS Registration Statement, at the time it became effective under the Securities Act, (i) conformed in all respects to the requirements of the Securities Act and the rules and regulations thereunder and (ii) and did not, as of the applicable effective date, contain an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading. All amounts payable by the Company in respect of the Securities shall be made free and clear of and without deduction for or on account of any taxes imposed, assessed or levied in Australia or by any authority thereof or therein (except such income taxes as may otherwise be imposed in Australia on payments hereunder if the Underwriter’s net income is subject to tax in Australia or withholding, if any, with respect to any such income tax) nor are any taxes imposed in Australia on, or by virtue of the execution or delivery of, such documents (other than stamp duty payable if such original documents are brought to, executed in or produced before a court in Australia).
(h) Issuance of Securities. The Securities are duly authorized and, when issued and paid for in accordance with the applicable Transaction Documents, will be duly and validly issued, fully paid and nonassessable (to the extent such concept exists under Australian law), free and clear of all Liens and the Underlying Ordinary Shares will rank equally in all respects with other Ordinary Shares on and from issue. The Representative’s Warrant ADSs, and Warrant ADSs when issued in accordance with the terms of the Representative’s Warrant and Investor’s Warrants, respectively, will be validly issued, fully paid and nonassessable (to the extent such concept exists under Australian law), free and clear of all Liens and the Underlying Ordinary Shares will rank equally in all respects with other Ordinary Shares on and from issue. Upon the due issuance by the Depositary of the ADSs evidencing the ADSs against the deposit of the Underlying Ordinary Shares in accordance with the provisions of the Deposit Agreement, such ADRs will be duly and validly issued under the Deposit Agreement and Persons in whose name such ADSs are registered will be entitled to the right of registered holders of ADSs evidencing the ADSs specified therein and in the Deposit Agreement. The Company has the capacity to issue the maximum number of Ordinary Shares issuable pursuant to this Agreement without requiring approval of shareholders or any other person. The holder of the Securities will not be subject to personal liability by reason of being such holders. The Securities are not and will not be subject to the preemptive rights of any holders of any security of the Company or similar contractual rights granted by the Company. All corporate action required to be taken for the authorization, issuance and sale of the Securities has been duly and validly taken, and no further approval or authorization of any stockholder, the Board of Directors or others is required for the issuance and sale of the Securities. The Securities conform in all material respects to all statements with respect thereto contained in the Registration Statement, the General Disclosure Package and Prospectus. The terms of the Representative’s Warrant and Investor’s Warrants, respectively, comply with the ASX Listing Rules.
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(i) Capitalization. The capitalization of the Company is as set forth in the Registration Statement and the Prospectus. The Company has not issued any securities since the initial public filing of the Registration Statement, other than pursuant to the exercise of employee stock options under the Company’s stock option plans, the issuance of Ordinary Shares to employees pursuant to the Company’s employee stock purchase plans and pursuant to the conversion and/or exercise of Ordinary Share Equivalents outstanding as of the date of the initial public filing of the Registration Statement. No Person has any right of first refusal, preemptive right, right of participation, or any similar right to participate in the transactions contemplated by the Transaction Documents. Except as a result of the purchase and sale of the Securities, there are no outstanding options, warrants, scrip rights to subscribe to, calls or commitments of any character whatsoever relating to, or securities, rights or obligations convertible into or exercisable or exchangeable for, or giving any Person any right to subscribe for or acquire, any ADSs or Ordinary Shares, or contracts, commitments, understandings or arrangements by which the Company or any Subsidiary is or may become bound to issue additional Ordinary Shares or Ordinary Share Equivalents. Except as set forth in the Registration Statement, the General Disclosure Package and the Prospectus, there are no outstanding securities or instruments of the Company or any Subsidiary with any provision that adjusts the exercise, conversion, exchange or reset price of such security or instrument upon an issuance of securities by the Company or any Subsidiary. There are no outstanding securities or instruments of the Company or any Subsidiary that contain any redemption or similar provisions, and there are no contracts, commitments, understandings or arrangements by which the Company or any Subsidiary is or may become bound to redeem a security of the Company or such Subsidiary. The Company does not have any stock appreciation rights or “phantom stock” plans or agreements or any similar plan or agreement. All of the issued shares of the Company are duly authorized, validly issued, fully paid and nonassessable (to the extent such concept exists under Australian law), have been issued in compliance with all applicable law and the requirements of the ASX, and none of such issued shares were issued in violation of any preemptive rights or similar rights to subscribe for or purchase securities. The issued shares of the Company conform in all material respects to all statements relating thereto contained in the Registration Statement, the General Disclosure Package and the Prospectus. The offers and sales of the Company’s securities were made in compliance with applicable laws. No further approval or authorization of any stockholder of the Board of Directors of the Company or others is required for the issuance and sale of the Securities, other than the Required Approvals. There are no shareholders agreements, voting agreements or other similar agreements with respect to the Company’s issued shares to which the Company is a party or, to the knowledge of the Company, between or among any of the Company’s shareholders.
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(j) Financial Statements. The financial statements of the Company included in the Registration Statement, the General Disclosure Package and the Prospectus comply in all material respects with applicable accounting requirements and the rules and regulations of the Commission with respect thereto as in effect at the time of filing. Such financial statements have been prepared in accordance with International Financial Reporting Standards (“IFRS”), as issued by the International Accounting Standard Board, applied on a consistent basis during the periods involved, except as may be otherwise specified in such financial statements or the notes thereto and except that unaudited financial statements may not contain all footnotes required by IFRS, and fairly present in all material respects the financial position of the Company and its consolidated Subsidiaries as of and for the dates thereof and the results of operations and cash flows for the periods then ended, subject, in the case of unaudited statements, to normal, year-end audit adjustments. The agreements and documents described in the Registration Statement, the General Disclosure Package and the Prospectus conform, in all material respects, to the descriptions thereof contained therein and there are no agreements or other documents required by the Securities Act and the rules and regulations thereunder to be described in the Registration Statement, the General Disclosure Package and the Prospectus or to be filed with the Commission as exhibits to the Registration Statement, that have not been so described or filed. Each agreement or other instrument (however characterized or described) to which the Company is a party or by which it is or may be bound or affected and (i) that is referred to in the Registration Statement, the General Disclosure Package and the Prospectus, or (ii) is material to the Company’s business, has been duly authorized and validly executed by the Company, is in full force and effect in all material respects and is enforceable against the Company and, to the Company’s knowledge, the other parties thereto, in accordance with its terms, except (x) as such enforceability may be limited by bankruptcy, insolvency, reorganization or similar laws affecting creditors’ rights generally, (y) as enforceability of any indemnification or contribution provision may be limited under the federal and state securities laws, and (z) that the remedy of specific performance and injunctive and other forms of equitable relief may be subject to the equitable defenses and to the discretion of the court before which any proceeding therefore may be brought. None of such agreements or instruments has been assigned by the Company, and neither the Company nor, to the best of the Company’s knowledge, any other party is in default thereunder and, to the best of the Company’s knowledge, no event has occurred that, with the lapse of time or the giving of notice, or both, would constitute a default thereunder. To the best of the Company’s knowledge, performance by the Company of the material provisions of such agreements or instruments will not result in a violation of any existing applicable law, rule, regulation, judgment, order or decree of any governmental agency or court, domestic or foreign, having jurisdiction over the Company or any of its assets or businesses, including, without limitation, those relating to environmental laws and regulations.
(k) Material Changes; Undisclosed Events, Liabilities or Developments. Since the date of the latest audited financial statements included within the Registration Statement, the General Disclosure Package and the Prospectus (i) there has been no event, occurrence or development that has had or that would reasonably be expected to result in a Material Adverse Effect, (ii) the Company has not incurred any liabilities (contingent or otherwise) other than (A) trade payables and accrued expenses incurred in the ordinary course of business consistent with past practice and (B) liabilities not required to be reflected in the Company’s financial statements pursuant to IFRS or disclosed in the Registration Statement, the General Disclosure Package or the Prospectus, (iii) the Company has not altered its method of accounting, (iv) the Company has not declared or made any dividend or distribution of cash or other property to its shareholders or purchased, redeemed or made any agreements to purchase or redeem any issued shares, (v) the Company has not issued any equity securities to any officer, director or Affiliate, except pursuant to existing Company stock option plans, and (vi) no officer or director of the Company has resigned from any position with the Company. The Company does not have pending before the Commission any request for confidential treatment of information. Except for the issuance of the Securities contemplated by this Agreement, no event, liability, fact, circumstance, occurrence or development has occurred or exists or is reasonably expected to occur or exist with respect to the Company or its Subsidiaries or their respective businesses, prospects, properties, operations, assets or financial condition that would be required to be disclosed by the Company under applicable securities laws at the time this representation is made or deemed made that has not been publicly disclosed at least 1 Trading Day prior to the date that this representation is made. Unless otherwise disclosed in the Registration Statement, the General Disclosure Package and the Prospectus, the Company has not: (i) issued any securities or incurred any liability or obligation, direct or contingent, for borrowed money; or (ii) declared or paid any dividend or made any other distribution on or in respect to its issued shares.
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(l) Litigation. There is no action, suit, inquiry pending or, to the knowledge of the Company notice of violation, proceeding or investigation threatened against or affecting the Company, any Subsidiary or any of their respective properties before or by any court, arbitrator, governmental or administrative agency or regulatory authority (federal, state, county, local or foreign) (collectively, an “Action”) which (i) adversely affects or challenges the legality, validity or enforceability of any of the Transaction Documents or the Securities or (ii) could, if there were an unfavorable decision, have or reasonably be expected to result in a Material Adverse Effect. Neither the Company nor any Subsidiary, nor any director or officer thereof, is or has been the subject of any Action involving a claim of violation of or liability under federal or state securities laws or a claim of breach of fiduciary duty. There has not been, and to the knowledge of the Company, there is not pending or contemplated, any investigation by the Commission, ASIC or ASX involving the Company or any current or former director or officer of the Company. The Commission has not issued any stop order or other order suspending the effectiveness of any registration statement filed by the Company or any Subsidiary under the Exchange Act or the Securities Act and ASIC has not issued any stop order or other order suspending the ability of the Company to issue the Underlying Ordinary Shares.
(m) Labor Relations. No labor dispute exists or, to the knowledge of the Company, is imminent with respect to any of the employees of the Company, which could reasonably be expected to result in a Material Adverse Effect. None of the Company’s or its Subsidiaries’ employees is a member of a union that relates to such employee’s relationship with the Company or such Subsidiary, and neither the Company nor any of its Subsidiaries is a party to a collective bargaining agreement, and the Company and its Subsidiaries believe that their relationships with their employees are good. To the knowledge of the Company, no executive officer of the Company or any Subsidiary, is, or is now expected to be, in violation of any material term of any employment contract, confidentiality, disclosure or proprietary information agreement or non-competition agreement, or any other contract or agreement or any restrictive covenant in favor of any third party, and the continued employment of each such executive officer does not subject the Company or any of its Subsidiaries to any liability with respect to any of the foregoing matters. The Company and its Subsidiaries are in compliance with all Australian (and, if any, all applicable U.S. federal, state and local) laws and regulations relating to employment and employment practices, terms and conditions of employment and wages and hours, except where the failure to be in compliance could not, individually or in the aggregate, have or reasonably be expected to have a Material Adverse Effect. Except as disclosed in the Registration Statement, the General Disclosure Package and the Prospectus, neither the Company nor any Subsidiary has any material obligation to provide retirement, healthcare, death or disability benefits to any of the present or past employees of the Company or any Subsidiary or to any other Person.
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(n) Compliance. To the best of the Company’s knowledge, neither the Company nor any Subsidiary: (i) is in default under or in violation of (and no event has occurred that has not been waived that, with notice or lapse of time or both, would result in a default by the Company or any Subsidiary under), nor has the Company or any Subsidiary received notice of a claim that it is in default under or that it is in violation of, any indenture, loan or credit agreement or any other agreement or instrument to which it is a party or by which it or any of its properties is bound (whether or not such default or violation has been waived), (ii) is in violation of any judgment, decree or order of any court, arbitrator or other governmental authority or (iii) is or has been in violation of any statute, rule, ordinance or regulation of any governmental authority, including without limitation all foreign, federal, state and local laws relating to taxes, environmental protection, occupational health and safety, product quality and safety and employment and labor matters, except in each case as would not have or reasonably be expected to result in a Material Adverse Effect.
(o) Regulatory Permits. The Company and the Subsidiaries possess all certificates, authorizations and permits issued by the appropriate federal, state, local or foreign regulatory authorities necessary to conduct their respective businesses as described in the Registration Statement and Prospectus, except where the failure to possess such permits could not have or reasonably be expected to result in a Material Adverse Effect (each, a “Material Permit”), and neither the Company nor any Subsidiary has received any notice of proceedings relating to the revocation or modification of any Material Permit. The disclosures in the Registration Statement concerning the effects of federal, state, local and all foreign regulation on the Company’s business as currently contemplated are correct in all material respects.
(p) Title to Assets. The Company and the Subsidiaries have good and marketable title in fee simple to, or have valid and marketable rights to lease or otherwise use, all real property and all personal property that is material to the business of the Company and the Subsidiaries, in each case free and clear of all Liens, except for (i) Liens as do not materially affect the value of such property and do not materially interfere with the use made and proposed to be made of such property by the Company and the Subsidiaries and (ii) Liens for the payment of federal, state or other taxes, for which appropriate reserves have been made in accordance with IFRS, and the payment of which is neither delinquent nor subject to penalties. Any real property and facilities held under lease by the Company and the Subsidiaries are held by them under valid, subsisting and enforceable leases with which the Company and the Subsidiaries are in compliance.
(q) Insurance. The Company and the Subsidiaries are insured by insurers of recognized financial responsibility against such losses and risks and in such amounts as are prudent and customary in the businesses in which the Company and the Subsidiaries are engaged, including, but not limited to, directors and officers insurance coverage. Neither the Company nor any Subsidiary has any reason to believe that it will not be able to renew its existing insurance coverage as and when such coverage expires or to obtain similar coverage from similar insurers as may be necessary to continue its business without a significant increase in cost.
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(r) Transactions With Affiliates and Employees. Except as set forth in the Registration Statement, the General Disclosure Package or the Prospectus, none of the officers or directors of the Company or any Subsidiary and to the knowledge of the Company, none of the employees of the Company or any Subsidiary is presently a party to any transaction with the Company or any Subsidiary (other than for services as employees, officers and directors), including any contract, agreement or other arrangement providing for the furnishing of services to or by, providing for rental of real or personal property to or from, providing for the borrowing of money from or lending of money to or otherwise requiring payments to or from, any officer, director or such employee or, to the knowledge of the Company, any entity in which any officer, director, or any such employee has a substantial interest or is an officer, director, trustee, stockholder, member or partner, in each case in excess of $120,000 other than for (i) payment of salary or consulting fees for services rendered, (ii) reimbursement for expenses incurred on behalf of the Company and (iii) other employee benefits, including stock option agreements under any stock option plan of the Company.
(s) Representations and Warranties Relating to Australia.
(i) Compliance with Australian Securities Laws. Other than any declaration, determination, exemption or order made by ASIC in relation to the application for relief by the Company and the Representative under sections 655A(1)(b) and 673(1)(b) of the Corporations Act in relation to the Lock-Up Agreements, the Company is not the subject of a determination or order issued by ASIC nor has ASIC given any notice of intention to hold an investigation in relation to the Company, and the Company is not aware of any such determination, order or investigation being contemplated or threatened by ASIC. The Company is admitted to the official list of the ASX, its Ordinary Shares are quoted on ASX and it is a disclosing entity under the Corporations Act and its associated regulations and all applicable regulations, class orders, instruments, rulings or relief of ASIC (the “Australian Securities Laws”) and, is not in default of any requirement of the Australian Securities Laws, the ASX Listing Rules (including any waivers of such rules) and its constitution, and will not be by issuing the Underlying Ordinary Shares and otherwise complying with its obligations under this Agreement. All disclosure and filings on the public record and fees required to be made and paid by the Company pursuant to the Australian Securities Laws and the ASX Listing Rules have been made (including under ASX Listing Rule 3.1 and the continuous disclosure obligations under the Australian Securities Laws) and paid. The Company has taken no action designed to, or likely to have the effect of, delisting the Ordinary Shares from the ASX, nor has the Company received any notification from the ASX that it is contemplating such a delisting.
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(ii) Stamp Tax. No stamp or other issuance or transfer taxes or duties and no capital gains, income, withholding or other taxes are payable by or on behalf of the Underwriters or any investor to the government of Australia, the United States or any political subdivision or taxing authority thereof or therein in connection with (i) the sale and delivery by the Company of the Securities to or for the account of any investor and (ii) the execution and delivery of the Transaction Documents, in each case other than income tax that is imposed on the Underwriters or investors net income in the ordinary course of business.
(iii) No Limitations on Dividends and Distributions. Under current laws and regulations of Australia and any political subdivision thereof, all interest, principal, premium, if any, and other payments due or made on the Securities and dividends and other distributions declared and payable on the ADSs or the Ordinary Shares underlying the ADSs may be paid by the Company to the holder thereof in U.S. dollars and freely transferred out of Australia and all such payments made to holders thereof or therein who are non-residents of Australia will other than withholding tax (if applicable) not be subject to income or other taxes under laws and regulations of Australia or any political subdivision or taxing authority thereof or therein and will otherwise be free and clear of any other tax, duty, withholding or deduction in Australia or any political subdivision or taxing authority thereof or therein and without the necessity of obtaining any governmental authorization in Australia or any political subdivision or taxing authority thereof or therein.
(iv) Enforceability in Australia. This Agreement is enforceable against the Company in Australia in accordance with its terms. To ensure the legality, validity, enforceability or admissibility into evidence in Australia of this Agreement or the Deposit Agreement, it is not necessary that this Agreement or Deposit Agreement be filed or recorded with any court or other authority in Australia or that any stamp or similar tax in Australia be paid on or in respect of this Agreement or any other documents to be furnished hereunder unless they are brought to, executed in or produced before a court in Australia.
(v) Choice of Law in Australia. To the Company’s knowledge, under the laws of Australia, the courts of Australia will recognize and give effect to the choice of law provisions set forth in Section 7.7 hereof and would recognize as a valid judgment a final and conclusive judgment in personam obtained in any U.S. court against the Company to enforce this Agreement under which a fixed sum of money is payable (other than a sum of money payable in respect of multiple damages, taxes or other charges of a like nature or in respect of a fine or other penalty) and such judgment would be capable of enforcement by Australian courts provided that (i) such court had proper jurisdiction over the parties subject to such judgment; (ii) the applicable U.S. court did not contravene the rules of natural justice of Australia; (iii) such judgment was not obtained by fraud; (iv) the enforcement of the judgment would not be contrary to the public policy of Australia; (v) such judgment imposes on the judgment debtor a liability to pay a liquidated sum; (vi) such judgment has not been wholly satisfied; (vii) such judgment was obtained within the previous twelve years, and (viii) there is due compliance with the correct procedures under the laws of Australia. Except as described in the Registration Statement, the General Disclosure Package and the Prospectus, under the laws of Australia, the choice of law provisions set forth in Section 7.7 hereof will be recognized by the courts of Australia and any judgment obtained in any Specified Court (as defined below) arising out of or in relation to the obligations of the Company under this Agreement will be recognized in Australian courts and be capable of enforcement subject to the applicable statutory and common law principles of Australia relating to the enforceability of foreign judgments.
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(vi) Judgment Enforced in Australia. To the Company’s knowledge, under final judgment for a fixed sum of money rendered by a Specified Court (as defined below) having jurisdiction under its own domestic laws in respect of any suit, action or Proceeding against the Company based upon this Agreement, would be recognized and enforced against the Company by Australian courts without re-examining the merits of the case, provided that such judgment (i) is not in respect of taxes, a fine or a penalty, (ii) was not obtained by fraud; (iii) was not obtained in a manner and is not a kind the enforcement of which is contrary to natural justice or the public policy of Australia; (iv) such judgment has not been wholly satisfied; and (v) such judgment was obtained within the previous twelve years .
(t) Certain Fees. Except as set forth in the Registration Statement, General Disclosure Package and Prospectus, no brokerage or finder’s fees or commissions are or will be payable by the Company, any Subsidiary or Affiliate of the Company to any broker, financial advisor or consultant, finder, placement agent, investment banker, bank or other Person with respect to the transactions contemplated by the Transaction Documents. To the Company’s knowledge, there are no other arrangements, agreements or understandings of the Company or, to the Company’s knowledge, any of its stockholders that may affect the Underwriters’ compensation, as determined by FINRA. The Company has not made any direct or indirect payments (in cash, securities or otherwise) to: (i) any person, as a finder’s fee, consulting fee or otherwise, in consideration of such person raising capital for the Company or introducing to the Company persons who raised or provided capital to the Company; (ii) any FINRA member participating in the offering as defined in FINRA Rule 5110(j)(15) (“Participating Member”); or (iii) any person or entity that has any direct or indirect affiliation or association with any Participating Member, within the twelve months prior to the Execution Date, other than the prior payment of $25,000 to the Representative as provided hereunder in connection with the Offering. None of the net proceeds of the Offering will be paid by the Company to any Participating Member, except as specifically authorized herein.
(u) Investment Company; Passive Foreign Investment Company. The Company is not, and immediately after receipt of payment for the Public ADSs will not be required to register as an “investment company” under the Investment Company Act of 1940, as amended. The Company shall conduct its business in a manner so that it will not become an “investment company” subject to registration under the Investment Company Act of 1940, as amended.
(v) Registration Rights. No Person has any right to cause the Company or any Subsidiary to effect the registration under the Securities Act of any securities of the Company or any Subsidiary.
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(w) Listing and Maintenance Requirements. The Ordinary Shares issued as of the date hereof are admitted to trading on the ASX. The ADSs (including the Public ADSs and Warrant ADSs and Representative’s Warrant ADSs) and the Ordinary Shares underlying the ADSs (including the Underlying Ordinary Shares) are registered pursuant to Section 12(b) of the Exchange Act, and the Company has taken no action designed to, or which to its knowledge is likely to have the effect of, terminating the registration of the ADSs or the Ordinary Shares underlying the ADSs under the Exchange Act nor has the Company received any notification that the Commission is contemplating terminating such registration. The Public ADSs (and Warrant ADSs and Representative’s Warrant ADSs) offered hereby have been approved for listing on the Nasdaq Capital Market and the Underlying Ordinary Shares shall be approved for quotation on the ASX Closing Ordinary Shares and Option Ordinary Shares being offered with disclosure under Part 6D.2 of the Corporations Act and the subject to the Company filing an ASX Appendix 2A pursuant to Section 4.19. The Company has not, in the 24 months preceding the date hereof, received notice from any Trading Market on which the ADSs or Ordinary Shares are or have been listed or quoted to the effect that the Company is not in compliance with the listing or maintenance requirements of such Trading Market. The Company is, and has no reason to believe that it will not in the foreseeable future continue to be, in compliance with all such listing and maintenance requirements. The ADSs are currently eligible for electronic transfer through the Depository Trust Company or another established clearing corporation and the Company is current in payment of any applicable fees of the Depository Trust Company (or such other established clearing corporation) in connection with such electronic transfer.
(x) Application of Takeover Protections. The Company and the Board of Directors have taken all necessary action, if any, in order to render inapplicable any control share acquisition, business combination, poison pill (including any distribution under a rights agreement) or other similar anti-takeover provision under the Company’s constitution (or similar charter documents) or the laws of its state of incorporation that is or could become applicable as a result of the Underwriters and the Company fulfilling their obligations or exercising their rights under the Transaction Documents.
(y) Disclosure. The Registration Statement and the ADS Registration Statement (and any further documents to be filed with the Commission) contain all exhibits and schedules as required by the Securities Act. Each of the Registration Statement, the ADS Registration Statement and any post-effective amendment thereto, if any, at the time it became effective, complied in all material respects with the Securities Act and the Exchange Act and the applicable rules and regulations under the Securities Act and did not and, as amended or supplemented, if applicable, will not, contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading. The Preliminary Prospectus and the Prospectus, each as of its respective date, comply in all material respects with the Securities Act and the applicable rules and regulations thereunder. Each of the Preliminary Prospectuses and the Prospectus, as amended or supplemented, did not and will not contain as of the date thereof any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading. No post-effective amendment to the Registration Statement or the ADS Registration Statement reflecting any facts or events arising after the date thereof which represent, individually or in the aggregate, a fundamental change in the information set forth therein is required to be filed with the Commission. There are no documents required to be filed with the Commission in connection with the transaction contemplated hereby that (x) have not been filed as required pursuant to the Securities Act or (y) will not be filed within the requisite time period. There are no contracts or other documents required to be described in the Registration Statement or the Prospectus or to be filed as exhibits or schedules to the Registration Statement, which have not been described or filed as required.
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(z) Free-Writing Prospectuses, etc. Neither: (i) any Issuer-Represented General Free Writing Prospectus(es) issued at or prior to the Time of Sale and the Statutory Prospectus, all considered together (collectively, the “General Disclosure Package”), nor (ii) any Issuer-Represented Free Writing Prospectus(es), when considered together with the General Disclosure Package, nor (iii) any Written Testing-the-Waters Communication, when considered together with the General Disclosure Package, includes or included as of the Time of Sale any untrue statement of a material fact or omits or omitted as of the Time of Sale to state any material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading. Each Issuer-Represented Free Writing Prospectus, as of its issue date and at all subsequent times until the Closing Date or until any earlier date that the Company notified or notifies the Representative as described in Section 4.2(a), did not, does not and will not include any information that conflicted, conflicts or will conflict with the information contained in the then-current Registration Statement, Statutory Prospectus or Prospectus. (i) At the earliest time after the filing of the Registration Statement that the Company or other offering participant made a bona fide offer (within the meaning of Rule 164(h)(2) of the Securities and (ii) at the date of this Agreement, the Company was not and is not an “ineligible issuer”, as defined in Rule 405, including (x) the Company or any other subsidiary in the preceding three years not having been convicted of a felony or misdemeanor or having been made the subject of a judicial or administrative decree or order as described in Rule 405 and (y) the Company in the preceding three years not having been the subject of a bankruptcy petition or insolvency or similar Proceeding, not having had a registration statement be the subject of a Proceeding under Section 8 of the Securities Act and not being the subject of a Proceeding under Section 8A of the Securities Act in connection with the offering of the Securities, all as described in Rule 405.
(aa) Offering Materials. The Company has not distributed and will not distribute any prospectus or other offering material in connection with the Offering other than the General Disclosure Package, any Issuer-Represented Free Writing Prospectus, the Prospectus, any Testing-the-Waters Communication made in compliance with the terms hereof or other materials permitted by the Securities Act to be distributed by the Company and an Australian prospectus for the purposes of Part 6D.2 of the Corporations Act. Unless the Company obtains the prior consent of the Representative, the Company has not made and will not make any offer relating to the Public ADSs that would constitute an “issuer free writing prospectus,” as defined in Rule 433 under the Securities Act, or that would otherwise constitute a “free writing prospectus,” as defined in Rule 405 under the Securities Act, required to be filed with the Commission; provided that the prior written consent of the Representative shall be deemed to have been given in respect of any free writing prospectus referenced on Exhibit A attached hereto. The Company has complied and will comply with the requirements of Rules 164 and 433 under the Securities Act applicable to any Issuer-Represented Free Writing Prospectus as of its issue date and at all subsequent times through the Closing Date, including timely filing with the Commission where required, legending and record keeping. To the extent an electronic road show is used, the Company has satisfied and will satisfy the conditions in Rule 433 under the Securities Act to avoid a requirement to file with the Commission any electronic road show.
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(bb) Sarbanes-Oxley Compliance.
(i) Disclosure Controls. The Company has developed and will maintain disclosure controls and procedures that will comply with Rule 13a-15 or 15d-15 under the Exchange Act, and such controls and procedures have been designed to ensure that all material information concerning the Company will be made known on a timely basis to the individuals responsible for the preparation of the Company’s Exchange Act filings and other public disclosure documents.
(cc) Statistical Information. The statistical, industry-related and market-related data included in the Registration Statement, the General Disclosure Package and the Prospectus are based on or derived from sources which the Company reasonably and in good faith believes are reliable and accurate, and such data agree with the sources from which they are derived, and the Company has obtained the written consent to the use of such data from such sources, to the extent required.
(dd) Forward-Looking Statements. The Company had a reasonable basis for, and made in good faith, each “forward-looking statement” (within the meaning of Section 27A of the Securities Act or Section 21E of the Exchange Act) contained or incorporated by reference in the Registration Statement, the General Disclosure Package and the Prospectus.
(ee) No Integrated Offering. Neither the Company, nor any of its Affiliates, nor any Person acting on its or their behalf has, directly or indirectly, made any offers or sales of any security or solicited any offers to buy any security, under circumstances that would cause this offering of the Public ADSs to be integrated with prior offerings by the Company for purposes of any applicable shareholder approval provisions of any Trading Market on which any of the securities of the Company are listed or designated.
(ff) Solvency. Based on the consolidated financial condition of the Company as of the Closing Date, after giving effect to the receipt by the Company of the proceeds from the sale of the Public ADSs hereunder, (i) the fair saleable value of the Company’s assets exceeds the amount that will be required to be paid on or in respect of the Company’s existing debts and other liabilities (including known contingent liabilities) as they mature, (ii) the Company’s assets do not constitute unreasonably small capital to carry on its business as now conducted and as proposed to be conducted including its capital needs taking into account the particular capital requirements of the business conducted by the Company, consolidated and projected capital requirements and capital availability thereof, and (iii) the current cash flow of the Company, together with the proceeds the Company would receive, were it to liquidate all of its assets, after taking into account all anticipated uses of the cash, would be sufficient to pay all amounts on or in respect of its liabilities when such amounts are required to be paid. The Company does not intend to incur debts beyond its ability to pay such debts as they mature (taking into account the timing and amounts of cash to be payable on or in respect of its debt). The Company has no knowledge of any facts or circumstances which lead it to believe that it will file for reorganization or liquidation under the bankruptcy or reorganization laws of any jurisdiction within one year from the Closing Date. The Registration Statement, the General Disclosure Package and the Prospectus set forth as of the date hereof all material outstanding secured and unsecured Indebtedness of the Company or any Subsidiary, or for which the Company or any Subsidiary has commitments. Neither the Company nor any Subsidiary is in default with respect to any Indebtedness.
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(gg) Tax Status. Except for matters that would not, individually or in the aggregate, have or reasonably be expected to result in a Material Adverse Effect, the Company and its Subsidiaries each (i) has made or filed all applicable United States federal, state and local income and all Australian and foreign income and franchise tax returns, reports and declarations required by any jurisdiction to which it is subject, (ii) has paid all taxes and other governmental assessments and charges that are material in amount, shown or determined to be due on such returns, reports and declarations and (iii) has set aside on its books provision reasonably adequate for the payment of all material taxes for periods subsequent to the periods to which such returns, reports or declarations apply. There are no unpaid taxes in any material amount claimed to be due by the taxing authority of any jurisdiction, and the officers of the Company or of any Subsidiary know of no basis for any such claim. The provisions for taxes payable, if any, shown on the financial statements filed with or as part of the Registration Statement are sufficient for all accrued and unpaid taxes, whether or not disputed, and for all periods to and including the dates of such consolidated financial statements. The term “taxes” means all federal, state, local, foreign, and other net income, gross income, gross receipts, sales, use, ad valorem, transfer, franchise, profits, license, lease, service, service use, withholding, payroll, employment, excise, severance, stamp, occupation, premium, property, windfall profits, customs, duties or other taxes, fees, assessments, or charges of any kind whatsoever, together with any interest and any penalties, additions to tax, or additional amounts with respect thereto. The term “returns” means all returns, declarations, reports, statements, and other documents required to be filed in respect to taxes.
(hh) Foreign Corrupt Practices. Neither the Company nor any Subsidiary, nor to the knowledge of the Company or any Subsidiary, any agent or other person acting on behalf of the Company or any Subsidiary, has (i) directly or indirectly, used any funds for unlawful contributions, gifts, entertainment or other unlawful expenses related to foreign or domestic political activity, (ii) made any unlawful payment to foreign or domestic government officials or employees or to any foreign or domestic political parties or campaigns from corporate funds, (iii) failed to disclose fully any contribution made by the Company or any Subsidiary (or made by any person acting on its behalf of which the Company is aware) which is in violation of law, or (iv) violated in any material respect any provision of the FCPA. The Company has taken reasonable steps to ensure that its accounting controls and procedures are sufficient to cause the Company to comply in all material respects with the FCPA.
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(ii) Accountants. To the knowledge and belief of the Company, the Company Auditor (i) is an independent registered public accounting firm as required by the Exchange Act and (ii) shall express its opinion with respect to the financial statements to be included in the Company’s Annual Report for the fiscal year ended June 30, 2026. The Company Auditor has not, during the periods covered by the financial statements included in the Prospectus, provided to the Company any non-audit services, as such term is used in Section 10A(g) of the Exchange Act
(jj) Premises. With respect to each premises of the Company and its Subsidiaries which is material to the Company (on a consolidated basis) and which the Company and/or its Subsidiaries occupy as tenant (the “Premises”), the Company and/or such Subsidiaries occupy the Premises and have the exclusive right to occupy and use the Premises and each of the leases pursuant to which the Company and/or such Subsidiaries occupy the Premises is in good standing and in full force and effect.
(kk) Material Property.
(i) The Material Property is accurately and fully disclosed in the Registration Statement, the General Disclosure Package and the Prospectus and no other property or assets are necessary for the conduct of the business of the Company and its Subsidiaries as currently conducted. Other than the Material Property, as disclosed in the Registration Statement, the General Disclosure Package and the Prospectus, neither the Company nor any of its Subsidiaries currently owns or leases any material real or immovable property, right, title or interest, or any material mining or mineral claims, mining leases, mining concessions, concessions, exploration licenses, exploitation licenses, prospecting permits, participating interests or other conventional property, proprietary or contractual interests or rights, or any other rights for the exploration, mining, development or processing activities in respect of the Material Property.
(ii) The Company and/or its Subsidiaries are the absolute legal and beneficial owners of either mining leases, mining claims, mining concessions or participating interests or other conventional property, proprietary or contractual interests or rights (collectively, the “Mineral Rights”) in respect of the Material Property under valid, subsisting and enforceable title documents or other recognized and enforceable agreements or instruments, sufficient to permit the Company and its Subsidiaries to access, explore for, mine, develop and process the mineral deposits relating thereto and to conduct all operations and production and processing activities thereon, free and clear of any Liens, other than those described in the Registration Statement, the General Disclosure Package and the Prospectus. All other material Mineral Rights have been validly located, registered and recorded in accordance with all Applicable Laws and are valid, subsisting and in good standing. Except as disclosed in Registration Statement, the General Disclosure Package and the Prospectus, no material commission, royalty, license fee or similar payment to any person with respect to the Material Property is payable. There are no options or other participation interests or rights of preference relating to the Mineral Rights and all Mineral Rights have active status, except for eight claims which are suspended awaiting partial conversion to a mining lease, and neither the Company nor any of its Subsidiaries has received written notice of, nor has any knowledge of, any pending or threatened suspension or revocation proceedings in respect of the Mineral Rights or any of them from any Governmental Authority, or of any outstanding or threatened claim, action, litigation or proceedings with respect to the Mineral Rights before any Governmental Authority.
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(iii) The Company and its Subsidiaries have or are not aware of any reason why they will not obtain in the ordinary course, all necessary surface rights, access rights and other necessary rights and interests relating to the Material Property (collectively, the “Mining Rights”), granting the Company or its Subsidiaries with the right and ability to access, explore for, mine, construct, develop and process the mineral deposits and to conduct all operations and construction, production, commissioning and processing activities thereon, as are appropriate in view of the rights and interests therein of the Company or its Subsidiaries, free and clear of any Liens other than those described in the Registration Statement, the General Disclosure Package and the Prospectus and with only such exceptions as do not materially interfere with the use made or contemplated to be made by the Company or its Subsidiaries of the rights or interests so held. All of the Mining Rights and each of the documents, agreements, instruments and obligations relating thereto referred to above are valid, subsisting and in good standing in the name of the Company or its Subsidiaries, as applicable.
(iv) The Company and its Subsidiaries are not in default, and to the knowledge of the Company no other party is in default, of any of the material provisions of any such agreements, documents or instruments relating to the Mineral Rights or the Mining Rights, nor has any such default been alleged, and all such Mineral Rights and Mining Rights are in good standing under all Applicable Laws of the jurisdictions in which they are situated, and all taxes required to be paid thereon have been paid. The Material Property (or any interest in, or right to earn an interest in, any property) is not subject to any right of first refusal or purchase or acquisition right which is not disclosed in the Registration Statement, the General Disclosure Package and the Prospectus.
(v) All assessments or other work required to be performed and rent or renewal fees in relation to the Mineral Rights and the Mining Rights in order to maintain the Company’s or any of its Subsidiaries’ interest therein, if any, have been performed and paid to date and the Company and its Subsidiaries have complied in all respects with all Applicable Laws and contractual, legal and other obligations to third parties in order to maintain such interest.
(ll) Possession of Authorizations. The Company and its Subsidiaries have, collectively, obtained all Authorizations necessary as at the date hereof to conduct their operations and activities as currently carried on and the Company expects any additional Authorizations that are required to conduct their operations and activities as proposed to be commenced and carried on by the Company and its Subsidiaries to be obtained in the ordinary course and consistent with the anticipated timing as set forth in the Registration Statement, the General Disclosure Package and the Prospectus, including in respect of access to and the construction, commissioning, operation, production and processing activities at the Material Property. Each Authorization is valid, subsisting and in good standing, neither the Company nor any of its Subsidiaries is in material default or breach of any Authorization and no proceeding is pending or, to the knowledge of the Company, threatened to revoke or limit any Authorization which, if the subject of an unfavorable decision, order, ruling or finding, could result in a Material Adverse Effect.
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(mm) Description of Mineral Properties. The Material Property, the Mineral Rights and the Mining Rights, as disclosed in the Registration Statement, the General Disclosure Package and the Prospectus, constitute an accurate description of the Material Property, the Mineral Rights and the Mining Rights held by the Company and its Subsidiaries and no other property or assets are necessary for the conduct of the business of the Company as currently conducted. Other than the Material Property, Mineral Rights and the Mining Rights, as disclosed in the Registration Statement, the General Disclosure Package and the Prospectus, neither the Company nor any of its Subsidiaries currently owns or leases any material real or immovable property, right, title or interest, or any material mining or mineral claims, mining leases, mining concessions, concessions, exploration licenses, exploitation licenses, prospecting permits, participating interests or other conventional property, proprietary or contractual interests or rights, or any other rights for the exploration, mining, development or processing activities in respect of the Material Property.
(nn) Conduct of Operations. To the Company’s knowledge, all exploration and development operations on the properties of the Company, including all operations and activities relating to the exploration, development, construction and commissioning of the Material Property, have been conducted in all material respects in accordance with good exploration, development and engineering practices.
(oo) Office of Foreign Assets Control. Neither the Company nor any Subsidiary nor, to the Company’s knowledge, any director, officer, agent, employee or affiliate of the Company or any Subsidiary is currently subject to any U.S. sanctions administered by the Office of Foreign Assets Control of the U.S. Treasury Department.
(pp) U.S. Real Property Holding Corporation. The Company is not and has never been a U.S. real property holding corporation within the meaning of Section 897 of the Internal Revenue Code of 1986, as amended, and the Company shall so certify upon the Representative’s request.
(qq) Bank Holding Company Act. Neither the Company nor any of its Subsidiaries or Affiliates is subject to the Bank Holding Company Act of 1956, as amended (the “BHCA”) and to regulation by the Board of Governors of the Federal Reserve System (the “Federal Reserve”). Neither the Company nor any of its Subsidiaries or Affiliates owns or controls, directly or indirectly, five percent (5%) or more of the outstanding shares of any class of voting securities or twenty-five percent (25%) or more of the total equity of a bank or any entity that is subject to the BHCA and to regulation by the Federal Reserve. Neither the Company nor any of its Subsidiaries or Affiliates exercises a controlling influence over the management or policies of a bank or any entity that is subject to the BHCA and to regulation by the Federal Reserve.
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(rr) Money Laundering. The operations of the Company and its Subsidiaries are and have been conducted at all times in compliance with applicable financial record-keeping and reporting requirements of the Currency and Foreign Transactions Reporting Act of 1970, as amended, and applicable money laundering statutes and applicable rules and regulations thereunder (collectively, the “Money Laundering Laws”), and no action, suit or proceeding by or before any court or governmental agency, authority or body or any arbitrator involving the Company or any Subsidiary with respect to the Money Laundering Laws is pending or, to the knowledge of the Company or any Subsidiary, threatened.
(ss) D&O Questionnaires. To the Company’s knowledge, all information contained in the questionnaires completed by each of the Company’s directors and officers immediately prior to the Offering provided to the Representative is true and correct in all respects and the Company has not become aware of any information which would cause the information disclosed in such questionnaires to become inaccurate and incorrect.
(tt) FINRA Affiliation. No officer, director or any beneficial owner of 10% or more of the Company’s outstanding Ordinary Shares or Ordinary Share Equivalents has any direct or indirect affiliation or association with any Participating Member. The Company will advise the Representative and EGS if it learns that any officer, director or owner of 10% or more of the Company’s issued Ordinary Shares or Ordinary Share Equivalents is or becomes an affiliate or associated person of a Participating Member.
(uu) Officers’ Certificate. Any certificate signed by any duly authorized officer of the Company and delivered to the Representative or EGS shall be deemed a representation and warranty by the Company to the Underwriters as to the matters covered thereby.
(vv) Board of Directors. The Board of Directors is comprised of the persons set forth under the heading of the Prospectus captioned “Management.” The qualifications of the persons serving as board members and the overall composition of the Board of Directors comply with the Sarbanes-Oxley Act of 2002 and the rules promulgated thereunder applicable to the Company and the rules of the Trading Market. At least one member of the Board of Directors qualifies as a “financial expert” as such term is defined under the Sarbanes-Oxley Act of 2002 and the rules promulgated thereunder and the rules of the Trading Market. In addition, at least a majority of the persons serving on the Board of Directors qualify as “independent” as defined under the rules of the Trading Market.
(ww) Regulation M Compliance. The Company has not, and to its knowledge no one acting on its behalf has, (i) taken, directly or indirectly, any action designed to cause or to result in the stabilization or manipulation of the price of any security of the Company to facilitate the sale or resale of any of the Securities, (ii) sold, bid for, purchased, or, paid any compensation for soliciting purchases of, any of the Securities, or (iii) paid or agreed to pay to any Person any compensation for soliciting another to purchase any other securities of the Company, other than, in the case of clauses (ii) and (iii), compensation paid to the Company’s placement agent in connection with the placement of the Securities.
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(xx) Environmental Laws. The Company and its Subsidiaries (i) are in compliance with all federal, state, local and foreign laws relating to pollution or protection of human health or the environment (including ambient air, surface water, groundwater, land surface or subsurface strata), including laws relating to emissions, discharges, releases or threatened releases of chemicals, pollutants, contaminants, or toxic or hazardous substances or wastes (collectively, “Hazardous Materials”) into the environment, or otherwise relating to the manufacture, processing, distribution, use, treatment, storage, disposal, transport or handling of Hazardous Materials, as well as all authorizations, codes, decrees, demands, or demand letters, injunctions, judgments, licenses, notices or notice letters, orders, permits, plans or regulations, issued, entered, promulgated or approved thereunder (“Environmental Laws”); (ii) have received all permits licenses or other approvals required of them under applicable Environmental Laws to conduct their respective businesses; and (iii) are in compliance with all terms and conditions of any such permit, license or approval where in each clause (i), (ii) and (iii), the failure to so comply could be reasonably expected to have, individually or in the aggregate, a Material Adverse Effect.
(yy) Cybersecurity. (i)(x) There has been no security breach or other compromise of or relating to any of the Company’s or any Subsidiary’s information technology and computer systems, networks, hardware, software, data (including the data of its respective customers, employees, suppliers, vendors and any third party data maintained by or on behalf of it), equipment or technology (collectively, “IT Systems and Data”) and (y) the Company and the Subsidiaries have not been notified of, and has no knowledge of any event or condition that would reasonably be expected to result in, any security breach or other compromise to its IT Systems and Data; (ii) the Company and the Subsidiaries are presently in compliance with all applicable laws or statutes and all judgments, orders, rules and regulations of any court or arbitrator or governmental or regulatory authority, internal policies and contractual obligations relating to the privacy and security of IT Systems and Data and to the protection of such IT Systems and Data from unauthorized use, access, misappropriation or modification, except as would not, individually or in the aggregate, have a Material Adverse Effect; (iii) the Company and the Subsidiaries have implemented and maintained commercially reasonable safeguards to maintain and protect its material confidential information and the integrity, continuous operation, redundancy and security of all IT Systems and Data; and (iv) the Company and the Subsidiaries have implemented backup and disaster recovery technology consistent with industry standards and practices
(zz) Compliance with Data Privacy Laws. (i) The Company and the Subsidiaries are, and at all times during the last three (3) years were, in compliance with all applicable state, federal and foreign data privacy and security laws and regulations (collectively, “Privacy Laws”); (ii) the Company and the Subsidiaries have in place, comply with, and take appropriate steps reasonably designed to ensure compliance with their policies and procedures relating to data privacy and security and the collection, storage, use, disclosure, handling and analysis of Personal Data (as defined below) (the “Policies”); (iii) the Company provides accurate notice of its applicable Policies to its customers, employees, third party vendors and representatives as required by the Privacy Laws; and (iv) applicable Policies provide accurate and sufficient notice of the Company’s then-current privacy practices relating to its subject matter, and do not contain any material omissions of the Company’s then-current privacy practices, as required by Privacy Laws. “Personal Data” means (i) a natural person’s name, street address, telephone number, email address, photograph, social security number, bank information, or customer or account number; and (ii) any other piece of information that allows the identification of such natural person, or his or her family, or permits the collection or analysis of any identifiable data related to an identified person’s health or sexual orientation. (i) None of such disclosures made or contained in any of the Policies have been inaccurate, misleading, or deceptive in violation of any Privacy Laws and (ii) the execution, delivery and performance of the Transaction Documents will not result in a breach of any Privacy Laws or Policies. Neither the Company nor the Subsidiaries (i) to the knowledge of the Company, has received written notice of any actual or potential liability of the Company or the Subsidiaries under, or actual or potential violation by the Company or the Subsidiaries of, any of the Privacy Laws; (ii) is currently conducting or paying for, in whole or in part, any investigation, remediation or other corrective action pursuant to any regulatory request or demand pursuant to any Privacy Law; or (iii) is a party to any order, decree, or agreement by or with any court or arbitrator or governmental or regulatory authority that imposed any obligation or liability under any Privacy Law.
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ARTICLE IV.
OTHER AGREEMENTS OF THE PARTIES
4.1 Amendments to Registration Statement. The Company has delivered, or will as promptly as practicable deliver, to the Underwriters complete conformed copies of the Registration Statement, the ADS Registration Statement and of each consent and certificate of experts, as applicable, filed as a part thereof, and conformed copies of the Registration Statement, the ADS Registration Statement (each without exhibits), the Prospectus and any Preliminary Prospectus, as amended or supplemented, in such quantities and at such places as an Underwriter reasonably requests. Neither the Company nor any of its directors and officers has distributed and none of them will distribute, prior to the Closing Date, any offering material in connection with the offering and sale of the Securities other than the Prospectus, any Preliminary Prospectus, the Registration Statement, the ADS Registration Statement the General Disclosure Package and copies of the documents incorporated by reference therein. The Company shall not file any such amendment or supplement to the Registration Statement, ADS Registration Statement or the Prospectus to which the Representative shall reasonably object in writing.
4.2 Federal Securities Laws.
(a) Compliance. During the time when a Prospectus is required to be delivered under the Securities Act, the Company will use its best efforts to comply with all requirements imposed upon it by the Securities Act and the rules and regulations thereunder and the Exchange Act and the rules and regulations thereunder, as from time to time in force, so far as necessary to permit the continuance of sales of or dealings in the Securities in accordance with the provisions hereof and the Prospectus. If at any time when a Prospectus relating to the Securities is required to be delivered under the Securities Act, any event shall have occurred as a result of which, in the opinion of counsel for the Company or counsel for the Underwriters, the Prospectus, as then amended or supplemented, includes an untrue statement of a material fact or omits to state any material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading, or if it is necessary at any time to amend the Prospectus to comply with the Securities Act, the Company will notify the Underwriters promptly and prepare and file with the Commission, subject to Section 4.1 hereof, an appropriate amendment or supplement in accordance with Section 10 of the Securities Act and publish an announcement of the same on ASX.
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(b) Filing of Prospectus. The Company will file the Prospectus (in form and substance satisfactory to the Representative) with the Commission pursuant to the requirements of Rule 424 and publish an announcement of the same on ASX.
(c) Exchange Act Registration. For a period of three years from the Effective Date, the Company, or any successor to the Company (including following a redomicile), will use its best efforts to maintain the registration of the ADSs, Representative’s Warrant and Investor Warrants or any successor security under the Exchange Act. The Company will not deregister the ADSs, Representative’s Warrant or Investor Warrants under the Exchange Act without the prior written consent of the Representative which consent shall not be unreasonably withheld.
(d) Free Writing Prospectuses. The Company represents and agrees that it has not made and will not make any offer relating to the Public Securities that would constitute an issuer free writing prospectus, as defined in Rule 433 of the rules and regulations under the Securities Act, without the prior written consent of the Representative. Any such free writing prospectus consented to by the Representative is hereinafter referred to as a “Permitted Free Writing Prospectus.” The Company represents that it will treat each Permitted Free Writing Prospectus as an “issuer free writing prospectus” as defined in rule and regulations under the Securities Act, and has complied and will comply with the applicable requirements of Rule 433 of the Securities Act, including timely Commission filing where required, legending and record keeping.
4.3 Delivery to the Underwriters of Prospectuses. The Company will deliver to the Underwriters, without charge, from time to time during the period when the Prospectus is required to be delivered under the Securities Act or the Exchange Act such number of copies of each Prospectus as the Underwriters may reasonably request and, as soon as the Registration Statement, the ADS Registration Statement or any amendment or supplement thereto becomes effective, deliver to you two original executed Registration Statements or ADS Registration Statements, including exhibits, and all post-effective amendments thereto and copies of all exhibits filed therewith or incorporated therein by reference and all original executed consents of certified experts.
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4.4 Effectiveness and Events Requiring Notice to the Underwriters. The Company will use its best efforts to cause the Registration Statement and the ADS Registration Statement to remain effective with a current prospectus until the later of nine (9) months from the Effective Date and the date on which either the Investor Warrants or Representative’s Warrant are no longer exercisable, and will promptly notify the Underwriters and holders of either the Investor Warrants or Representative’s Warrant, as applicable and confirm the notice in writing: (i) of the effectiveness of the Registration Statement and the ADS Registration Statement and any amendment thereto; (ii) of the issuance by the Commission of any stop order or of the initiation, or the threatening, of any proceeding for that purpose; (iii) of the issuance by any state securities commission of any proceedings for the suspension of the qualification of the Securities for offering or sale in any jurisdiction or of the initiation, or the threatening, of any proceeding for that purpose; (iv) of the mailing and delivery to the Commission for filing of any amendment or supplement to the Registration Statement, the ADS Registration Statement, or Prospectus; (v) of the receipt of any comments or request for any additional information from the Commission; and (vi) of the happening of any event during the period described in this Section 4.4 that, in the judgment of the Company, makes any statement of a material fact made in the Registration Statement, the ADS Registration Statement, or the Prospectus untrue or that requires the making of any changes in the Registration Statement, the ADS Registration Statement, or the Prospectus in order to make the statements therein, in light of the circumstances under which they were made, not misleading. If the Commission or any state securities commission shall enter a stop order or suspend such qualification at any time, the Company will make every reasonable effort to obtain promptly the lifting of such order.
4.5 Review of Financial Statements. For a period of five (5) years from the Execution Date, the Company, at its expense, shall cause its regularly engaged independent registered public accountants to review (but not audit) the Company’s financial statements for each of the first three fiscal quarters prior to the announcement of quarterly financial information as the same is required by the principal Trading Market on which the Company’s securities are then traded.
4.6 Reports to the Underwriters.
(a) Periodic Reports, etc. For a period of three years from the Execution Date, the Company will furnish to the Representative copies of such financial statements and other periodic and special reports as the Company from time to time furnishes generally to holders of any class of its securities and also promptly furnish to the Underwriters: (i) a copy of each periodic report the Company shall be required to file with the Commission; (ii) a copy of each Form 6-K prepared and filed by the Company; (iii) a copyof each registration statement filed by the Company under the Securities Act; and (iv) such additional documents and information with respect to the Company and the affairs of any future Subsidiaries of the Company as the Representative may from time to time reasonably request; provided that the Underwriters shall each sign, if requested by the Company, a Regulation FD compliant confidentiality agreement which is reasonably acceptable to the Representative in connection with such Underwriter’s receipt of such information; and provided, further, that the foregoing shall not apply in the event the Company enters into a merger transaction in which the Company is the non-surviving entity that would cause the ADSs to no longer be registered under the Exchange Act. Documents filed with the Commission pursuant to its EDGAR system shall be deemed to have been delivered to the Underwriters pursuant to this Section.
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(b) Depositary. For a period equal to the earlier of (i) three (3) years from the Execution Date and (ii) the date on which there are no ADSs outstanding, the Company shall retain the Depositary or a depositary reasonably acceptable to the Representative.
(c) General Expenses Related to the Offering. The Company hereby agrees to pay on each of the Closing Date and each Option Closing Date, if any, to the extent not paid at the Closing Date, all expenses incident to the performance of the obligations of the Company under this Agreement, including, but not limited to: (a) all filing fees and communication expenses relating to the registration of the Securities to be sold in the Offering (including the Option Securities) with the Commission; (b) all FINRA Public Offering Filing System fees associated with the review of the Offering by FINRA; (c) all fees and expenses relating to the listing of such Public Securities on the Trading Market and such other stock exchanges as the Company and the Representative together determine; (d) all fees, expenses and disbursements relating to background checks of the Company’s officers and directors; (e) [not used]; (f) the costs of all mailing and printing of the underwriting documents (including, without limitation, this Agreement and, if appropriate, any Agreement Among Underwriters, Selected Dealers’ Agreement, Underwriters’ Questionnaire and Power of Attorney), Registration Statements, the ADS Registration Statement, Prospectuses and all amendments, supplements and exhibits thereto and as many preliminary and final Prospectuses as the Representative may reasonably deem necessary; (g) the costs and expenses of the Company’s public relations firm; (h) the costs of preparing, printing and delivering the Securities; (i) fees and expenses of the Transfer Agent for the Public Securities (including, without limitation, any fees required for same-day processing of any instruction letter delivered by the Company); (j) stock transfer and/or stamp taxes, if any, payable upon the transfer of securities from the Company to the Underwriters; (k) for commemorative mementos and lucite tombstones, each of which the Company or its designee will provide within a reasonable time after the Closing in such quantities as the Underwriters may reasonably request; (l) the fees and expenses of the Company’s accountants; (m) the fees and expenses of the Company’s legal counsel and other agents and representatives; (n) for the Underwriters’ use of i-Deal’s book-building, prospectus tracking and compliance software (or other similar software) for the Offering; (o) for the Underwriters’ actual “road show” expenses for the Offering; (p) the Underwriters’ costs of mailing prospectuses to prospective investors; and (r) up to $125,000 for the Underwriters’ legal fees and expenses, $25,000 of which has been paid prior to the date hereof. The Underwriters may also deduct from the net proceeds of the Offering payable to the Company on the Closing Date, or each Option Closing Date, if any, the expenses set forth herein to be paid by the Company to the Underwriters; provided the Company has agreed to such expenses.
4.7 Application of Net Proceeds. The Company will apply the net proceeds from the Offering received by it in a manner consistent with the application described under the caption “Use of Proceeds” in the Prospectus.
4.8 Delivery of Earnings Statements to Security Holders. The Company will make generally available to its security holders as soon as practicable, but not later than the first day of the fifteenth full calendar month following the Execution Date, an earnings statement (which need not be certified by independent public or independent certified public accountants unless required by the Securities Act or the Rules and Regulations under the Securities Act, but which shall satisfy the provisions of Rule 158(a) under Section 11(a) of the Securities Act) covering a period of at least twelve consecutive months beginning after the Execution Date.
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4.9 Stabilization. Neither the Company, nor, to its knowledge, any of its employees, directors or shareholders (without the consent of the Representative) has taken or will take, directly or indirectly, any action designed to or that has constituted or that might reasonably be expected to cause or result in, under the Exchange Act, or otherwise, stabilization or manipulation of the price of any security of the Company to facilitate the sale or resale of the Public Securities.
4.10 Internal Controls. The Company will maintain a system of internal accounting controls sufficient to provide reasonable assurances that: (i) transactions are executed in accordance with management’s general or specific authorization; (ii) transactions are recorded as necessary in order to permit preparation of financial statements in accordance with IFRS, the Corporations Act and the ASX Listing Rules and to maintain accountability for assets; (iii) access to assets is permitted only in accordance with management’s general or specific authorization; and (iv) the recorded accountability for assets is compared with existing assets at reasonable intervals and appropriate action is taken with respect to any differences.
4.11 Accountants; Transfer Agent. The Company shall continue to retain a nationally recognized independent certified public accounting firm for a period of at least three years after the Execution Date. The Underwriters acknowledge that the Company Auditor is acceptable to the Underwriters. The Company shall engage and maintain, at its expense, a registrar and transfer agent for the ADSs and Ordinary Shares for a period equal to the earlier of (i) three years after the Execution Date and (ii) the date on which there are no ADSs or Ordinary Shares outstanding, as the case may be.
4.12 FINRA. The Company shall advise the Underwriters (who shall make an appropriate filing with FINRA) if it is aware that any 10% or greater shareholder of the Company becomes an affiliate or associated person of a Participating Member.
4.13 No Fiduciary Duties. The Company acknowledges and agrees that the Underwriters’ responsibility to the Company is solely contractual and commercial in nature, based on arms-length negotiations and that neither the Underwriters nor their Affiliates or any selected dealer shall be deemed to be acting in a fiduciary capacity, or otherwise owes any fiduciary duty to the Company or any of its Affiliates in connection with the Offering and the other transactions contemplated by this Agreement. Notwithstanding anything in this Agreement to the contrary, the Company acknowledges that the Underwriters may have financial interests in the success of the Offering that are not limited to the difference between the price to the public and the purchase price paid to the Company by the Underwriters for the ADSs and the Underwriters have no obligation to disclose, or account to the Company for, any of such additional financial interests. The Company hereby waives and releases, to the fullest extent permitted by law, any claims that the Company may have against the Underwriters with respect to any breach or alleged breach of fiduciary duty.
4.14 Board Composition and Board Designations. The Company shall ensure that: (i) the qualifications of the persons serving as board members and the overall composition of the Board of Directors comply with the Sarbanes-Oxley Act of 2002 and the rules promulgated thereunder and with the listing requirements of the Trading Market and (ii) if applicable at least one member of the Board of Directors qualifies as a “financial expert” as such term is defined under the Sarbanes-Oxley Act of 2002 and the rules promulgated thereunder.
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4.15 Securities Laws Disclosure; Publicity. At the request of the Representative, at the time requested by the Representative, the Company shall issue a press release disclosing the material terms of the Offering. The Company and the Representative shall consult with each other in issuing any other press releases with respect to the Offering, and neither the Company nor any Underwriter shall issue any such press release nor otherwise make any such public statement without the prior consent of the Company, with respect to any press release of such Underwriter, or without the prior consent of such Underwriter, with respect to any press release of the Company, which consent shall not unreasonably be withheld or delayed, except if such disclosure is required by law, in which case the disclosing party shall promptly provide the other party with prior notice of such public statement or communication. The Company will not issue press releases or engage in any other publicity, without the Representative’s prior written consent, for a period ending at 5:00 p.m. (New York City time) on the first business day following the 45th day following the Closing Date, other than normal and customary releases issued in the ordinary course of the Company’s business or in compliance with ASX Listing Rules.
4.16 Shareholder Rights Plan. No claim will be made or enforced by the Company or, with the consent of the Company, any other Person, that any Underwriter of the Public ADSs is an “Acquiring Person” under any control share acquisition, business combination, poison pill (including any distribution under a rights agreement) or similar anti-takeover plan or arrangement in effect or hereafter adopted by the Company, or that any Underwriter of Public ADSs could be deemed to trigger the provisions of any such plan or arrangement, by virtue of receiving ADSs.
4.17 Issue of Ordinary Shares. As of the date hereof, the Company has the power and authority to issue, free of preemptive rights, a sufficient number of Ordinary Shares for the purpose of enabling the Company to deposit with the Depositary a number of Ordinary Shares sufficient to issue the Closing ADSs and the Option ADSs pursuant to the Over-Allotment Option, the Warrant ADSs pursuant to any exercise of Investor Warrants or Option Warrants and Warrant ADSs pursuant to any exercise of the Representative’s Warrant.
4.18 Listing of ADSs; Electronic Transfer. The Company hereby agrees to use best efforts to maintain the listing or quotation of the ADSs on the Nasdaq Capital Market and the Ordinary Shares on the ASX. The Company further agrees, if the Company applies to have the ADSs traded on any other Trading Market, it will then include in such application all of the Closing ADSs, Option ADSs and Warrant ADSs, and will take such other action as is necessary to cause all of the Closing ADSs, Option ADSs and Warrant ADSs to be listed or quoted on such other Trading Market as promptly as possible. The Company agrees to maintain the eligibility of the ADSs for electronic transfer through the Depository Trust Company or another established clearing corporation, including, without limitation, by timely payment of fees to the Depository Trust Company or such other established clearing corporation in connection with such electronic transfer.
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4.19 Disclosure under Part 6D.2 Corporations Act. The Company undertakes that the Offer Closing Ordinary Shares and Option Ordinary Shares will be made with disclosure under Part 6D.2 of the Corporations Act so that, upon the lodgment of an Appendix 2A in accordance with ASX Listing Rules, the Offer Closing Ordinary Shares and Option Ordinary Shares will be freely tradable on the ASX.
4.20 ASX Cleansing Document. The Company undertakes to lodge with the ASX a Cleansing Document and an ASX Appendix 2A on the date of issue of any Representative’s Warrant Ordinary Shares issued upon conversion of the applicable Warrant ADSs or on the date of issue of any Warrant Ordinary Shares issued upon conversion of Warrant ADSs (as the case may be), but in no event later than 10:00 a.m., Sydney time, on the ASX Trading Day immediately following the date of issue of any applicable Warrant Ordinary Shares, in a form, and containing the information, that is sufficient to permit subsequent re-sale on ASX of all of the applicable Warrant Ordinary Shares. Upon the lodging of an Appendix 2A and the Cleansing Document, the applicable Warrant Ordinary Shares will be freely tradable on the ASX.
4.21 Right of First Refusal. The Company has granted the Representative a right of first refusal, for a period of eighteen (18) months from the Closing Date, to act as sole managing underwriter and sole book runner, sole placement agent, or sole sales agent, for any and all future public or private equity, equity-linked, convertible or debt (excluding commercial bank debt) offerings for which the Company retains the service of an underwriter, agent, advisor, finder or other person or entity in connection with such offering during such eighteen (18) month period of the Company, or any successor to or any subsidiary of the Company. The Company shall not offer to retain any entity or person in connection with any such offering on terms more favorable than terms on which it offers to retain the Representative. Such offer shall be made in writing in order to be effective. The Representative shall notify the Company within ten (10) business days of its receipt of the written offer contemplated above as to whether or not it agrees to accept such retention. For the avoidance of doubt, the Company may not during such 18-month period use another investment bank, source or agent to raise such directly-sourced capital unless the Representative does not accept such retention.
4.22 Subsequent Equity Sales.
(a) From the date hereof until six (6) months following the Closing Date, neither the Company nor any Subsidiary shall issue, enter into any agreement to issue or announce the issuance or proposed issuance of any ADSs, Ordinary Shares or Ordinary Share Equivalents or file any registration statement or amendment or supplement thereto, other than the Prospectus and a Registration Statement on Form S-8 or with the Representative’s prior written approval.
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(b) From the date hereof until six (6) months following the Closing Date, the Company shall be prohibited from effecting or entering into an agreement to effect any issuance by the Company or any of its Subsidiaries of ADSs, Ordinary Shares or Ordinary Share Equivalents (or a combination of units thereof) involving a Variable Rate Transaction. “Variable Rate Transaction” means a transaction in which the Company (i) issues or sells any debt or equity securities that are convertible into, exchangeable or exercisable for, or include the right to receive, additional Ordinary Shares or ADSs either (A) at a conversion price, exercise price or exchange rate or other price that is based upon, and/or varies with, the trading prices of or quotations for the Ordinary Shares or ADSs at any time after the initial issuance of such debt or equity securities or (B) with a conversion, exercise or exchange price that is subject to being reset at some future date after the initial issuance of such debt or equity security or upon the occurrence of specified or contingent events directly or indirectly related to the business of the Company or the market for the Ordinary Shares or ADSs or (ii) enters into any agreement, including, but not limited to, an equity line of credit, whereby the Company may issue securities at a future determined price. Any Underwriter shall be entitled to obtain injunctive relief against the Company to preclude any such issuance, which remedy shall be in addition to any right to collect damages.
(c) Notwithstanding the foregoing, this Section 4.21 shall not apply in respect of an Exempt Issuance, except that no Variable Rate Transaction shall be an Exempt Issuance.
4.22 Deposit of Shares. The Company agrees, prior to the Closing Date and each Option Closing Date and the date of issue of any applicable Warrant ADSs, to deposit Underlying Ordinary Shares with the Depositary in accordance with the provisions of the Deposit Agreement and otherwise to comply with the Deposit Agreement so that ADRs evidencing the applicable ADSs will be issued by the Depositary against receipt of such Ordinary Shares and delivered to the Underwriter at such Closing Date or Option Closing Date and on the date of issue of any applicable Warrant ADSs.
4.23 Payment of Expenses Pursuant to Deposit Agreement and ADRs. The Company hereby agrees to pay on behalf of the Underwriter or any purchaser of Securities, or to reimburse the Underwriter or any such purchasers for, all fees and expenses incurred by such parties pursuant to Section [__] of the Deposit Agreement and Section [ ] of the ADRs with respect to the deposit of the Underlying Ordinary Shares and the delivery of ADSs representing such deposited Underlying Ordinary Shares.
4.24 Payments and Taxes. All payments by the Company due under any Transaction Document shall be made by the Company and the Company agrees that all amounts payable under any Transaction Document are exclusive of any current or future tax or any other fees, expenses, assessment or charges of any kind (including but not limited to income tax, value added tax, goods and services tax, transfer tax, business tax, foreign enterprise income tax, consumption tax, securities transaction tax, withholding tax, stamp duty or other documentary taxes or charges, and any other taxes and charges, and interest and penalties thereon) imposed by any federal, state, territorial or local government of Australia, or any political subdivision or taxing authority in any such jurisdiction (collectively, “Taxes,” which for the avoidance of doubt, does not include income tax) and all amounts shall be paid free and clear of any deduction or withholding. The Company agrees that it shall be responsible for all Taxes as well as all applicable compliance and regulatory obligations which may arise from or in connection with this Agreement. If any Taxes shall be due, or if the Company shall be required by applicable law to make any deduction or withholding on account of any Taxes, or if any Tax is required to be paid by the Underwriters on account of services performed hereunder, the Company agrees to pay to the Underwriters such additional amounts as shall be required so that the net amount received by the Underwriters from the Company after such deduction, withholding or payment shall equal the amount otherwise due to the Underwriters hereunder. The Company shall promptly deliver to the Underwriters all official tax receipts evidencing payment of the Taxes. The Underwriters agree to provide the Company with any and all forms or other documentation or information that the Company reasonably requests to enable the Company to minimize the amount of any such Taxes. The Company will indemnify the Underwriters and hold it harmless against any Taxes on the creation, issuance and sale of the Securities to the Underwriters and on the execution and delivery of this Agreement and any interest and penalties thereon.
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4.25. Tail Period. Notwithstanding any other provision of this Agreement, including, but not limited to, Section 4.20 of this Agreement, for a period of twelve months from the date of this Agreement, if the Company receives any proceeds from any investor contacted or introduced to the Company by the Representative, then the Company agrees to pay to the Representative a cash fee equal to up to 8.0% of such proceeds and issue the Representative a warrant equal to 5.0% of the securities issued in such subsequent offering.
4.26. Research Independence. The Company acknowledges that each Underwriter’s research analysts and research departments, if any, are required to be independent from their respective investment banking divisions and are subject to certain regulations and internal policies, and that such Underwriter’s research analysts may hold and make statements or investment recommendations and/or publish research reports with respect to the Company and/or the offering that differ from the views of its investment bankers. The Company hereby waives and releases, to the fullest extent permitted by law, any claims that the Company may have against such Underwriter with respect to any conflict of interest that may arise from the fact that the views expressed by their independent research analysts and research departments may be different from or inconsistent with the views or advice communicated to the Company by such Underwriter’s investment banking divisions. The Company acknowledges that the Representative is a full service securities firm and as such from time to time, subject to applicable securities laws, may effect transactions for its own account or the account of its customers and hold long or short position in debt or equity securities of the Company.
4.27 Warrant ADSs. If all or any portion of an Investor Warrant or Representative’s Warrant is exercised at a time when there is an effective registration statement to cover the issuance of the Warrant ADSs or if the Investor Warrants or Representative’s Warrant is exercised via cashless exercise, the Warrant ADSs issued pursuant to any such exercise shall be issued free of all restrictive legends. If at any time following the date hereof the Registration Statement (or any subsequent registration statement registering the sale or resale of the Warrant Shares) is not effective or is not otherwise available for the sale of the Warrant ADSs, the Company shall immediately notify the holders of the Investor Warrants or Representative’s Warrant in writing that such registration statement is not then effective and thereafter shall promptly notify such holders when the registration statement is effective again and available for the sale of the Warrant ADSs (it being understood and agreed that the foregoing shall not limit the ability of the Company to issue, or any holder thereof to sell, any of the Warrant ADSs in compliance with applicable federal and state securities laws).
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ARTICLE V.
DEFAULT BY UNDERWRITERS
If on the Closing Date or any Option Closing Date, if any, any Underwriter shall fail to purchase and pay for the portion of the Closing Securities or Option Securities, as the case may be, which such Underwriter has agreed to purchase and pay for on such date (otherwise than by reason of any default on the part of the Company), the Representative, or if the Representative is the defaulting Underwriter, the non-defaulting Underwriters, shall use their reasonable efforts to procure within 36 hours thereafter one or more of the other Underwriters, or any others, to purchase from the Company such amounts as may be agreed upon and upon the terms set forth herein, the Closing Securities or Option Securities, as the case may be, which the defaulting Underwriter or Underwriters failed to purchase. If during such 36 hours the Representative shall not have procured such other Underwriters, or any others, to purchase the Closing Securities or Option Securities, as the case may be, agreed to be purchased by the defaulting Underwriter or Underwriters, then (a) if the aggregate number of Closing Securities or Option Securities, as the case may be, with respect to which such default shall occur does not exceed 10% of the Closing Securities or Option Securities, as the case may be, covered hereby, the other Underwriters shall be obligated, severally, in proportion to the respective numbers of Closing Securities or Option Securities, as the case may be, which they are obligated to purchase hereunder, to purchase the Closing Securities or Option Securities, as the case may be, which such defaulting Underwriter or Underwriters failed to purchase, or (b) if the aggregate number of Closing Securities or Option Securities, as the case may be, with respect to which such default shall occur exceeds 10% of the Closing Securities or Option Securities, as the case may be, covered hereby, the Company or the Representative will have the right to terminate this Agreement without liability on the part of the non-defaulting Underwriters or of the Company except to the extent provided in Article VI hereof. In the event of a default by any Underwriter or Underwriters, as set forth in this Article V, the applicable Closing Date may be postponed for such period, not exceeding seven days, as the Representative, or if the Representative is the defaulting Underwriter, the non-defaulting Underwriters, may determine in order that the required changes in the Prospectus or in any other documents or arrangements may be effected. The term “Underwriter” includes any person substituted for a defaulting Underwriter. Any action taken under this Section shall not relieve any defaulting Underwriter from liability in respect of any default of such Underwriter under this Agreement.
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ARTICLE VI.
INDEMNIFICATION
6.1 Indemnification of the Underwriters. Subject to the conditions set forth below, the Company agrees to indemnify and hold harmless the Underwriters, and each dealer selected by each Underwriter that participates in the offer and sale of the Public Securities (each a “Selected Dealer”) and each of their respective directors, officers and employees and each Person, if any, who controls such Underwriter or any Selected Dealer (“Controlling Person”) within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act, against any and all loss, liability, claim, damage and expense whatsoever (including but not limited to any and all legal or other expenses reasonably incurred in investigating, preparing or defending against any litigation, commenced or threatened, or any claim whatsoever, whether arising out of any action between such Underwriter and the Company or between such Underwriter and any third party or otherwise) to which they or any of them may become subject under the Securities Act, the Exchange Act or any other statute or at common law or otherwise or under the laws of foreign countries, arising out of or based upon any Proceeding, commenced or threatened (whether or not such Underwriter is a target of or party to such Proceeding), or arising out of or based upon any untrue statement or alleged untrue statement of a material fact contained in (i) any Preliminary Prospectus, if any, the Registration Statement or the Prospectus (as from time to time each may be amended and supplemented); (ii) any materials or information provided to investors by, or with the approval of, the Company in connection with the marketing of the offering of the Securities, including any “road show” or investor presentations made to investors by the Company (whether in person or electronically); or (iii) any application or other document or written communication (in this Article VI, collectively called “application”) executed by the Company or based upon written information furnished by the Company in any jurisdiction in order to qualify the Securities under the securities laws thereof or filed with the Commission, any state securities commission or agency, Trading Market or any securities exchange; or the omission or alleged omission therefrom of a material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading, unless such statement or omission was made in reliance upon and in conformity with written information furnished to the Company with respect to the applicable Underwriter by or on behalf of such Underwriter expressly for use in any Preliminary Prospectus, if any, the Registration Statement or Prospectus, or any amendment or supplement thereto, or in any application, as the case may be. With respect to any untrue statement or omission or alleged untrue statement or omission made in the Preliminary Prospectus, if any, the indemnity agreement contained in this Section 6.1 shall not inure to the benefit of an Underwriter to the extent that any loss, liability, claim, damage or expense of such Underwriter results from the fact that a copy of the Prospectus was not given or sent to the Person asserting any such loss, liability, claim or damage at or prior to the written confirmation of sale of the Securities to such Person as required by the Securities Act and the rules and regulations thereunder, and if the untrue statement or omission has been corrected in the Prospectus, unless such failure to deliver the Prospectus was a result of non-compliance by the Company with its obligations under this Agreement. The Company agrees promptly to notify each Underwriter of the commencement of any litigation or proceedings against the Company or any of its officers, directors or Controlling Persons in connection with the issue and sale of the Securities or in connection with the Registration Statement or Prospectus.
6.2 Procedure. If any action is brought against an Underwriter, a Selected Dealer or a Controlling Person in respect of which indemnity may be sought against the Company pursuant to Section 6.1, such Underwriter, such Selected Dealer or Controlling Person, as the case may be, shall promptly notify the Company in writing of the institution of such action and the Company shall assume the defense of such action, including the employment and fees of counsel (subject to the reasonable approval of such Underwriter or such Selected Dealer, as the case may be) and payment of actual expenses. Such Underwriter, such Selected Dealer or Controlling Person shall have the right to employ its or their own counsel in any such case, but the fees and expenses of such counsel shall be at the expense of such Underwriter, such Selected Dealer or Controlling Person unless (i) the employment of such counsel at the expense of the Company shall have been authorized in writing by the Company in connection with the defense of such action, or (ii) the Company shall not have employed counsel to have charge of the defense of such action, or (iii) such indemnified party or parties shall have reasonably concluded that there may be defenses available to it or them which are different from or additional to those available to the Company (in which case the Company shall not have the right to direct the defense of such action on behalf of the indemnified party or parties), in any of which events the reasonable fees and expenses of not more than one additional firm of attorneys selected by such Underwriter (in addition to local counsel), Selected Dealer and/or Controlling Person shall be borne by the Company. Notwithstanding anything to the contrary contained herein, if any Underwriter, Selected Dealer or Controlling Person shall assume the defense of such action as provided above, the Company shall have the right to approve the terms of any settlement of such action which approval shall not be unreasonably withheld.
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6.3 Indemnification of the Company. Each Underwriter severally and not jointly agrees to indemnify and hold harmless the Company, its directors, officers and employees and agents who control the Company within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act against any and all loss, liability, claim, damage and expense described in the foregoing indemnity from the Company to such Underwriter, as incurred, but only with respect to untrue statements or omissions, or alleged untrue statements or omissions made in any Preliminary Prospectus, if any, the Registration Statement or Prospectus or any amendment or supplement thereto or in any application, in reliance upon, and in strict conformity with, written information furnished to the Company with respect to such Underwriter by or on behalf of such Underwriter expressly for use in such Preliminary Prospectus, if any, the Registration Statement or Prospectus or any amendment or supplement thereto or in any such application. In case any action shall be brought against the Company or any other Person so indemnified based on any Preliminary Prospectus, if any, the Registration Statement or Prospectus or any amendment or supplement thereto or any application, and in respect of which indemnity may be sought against such Underwriter, such Underwriter shall have the rights and duties given to the Company, and the Company and each other Person so indemnified shall have the rights and duties given to such Underwriter by the provisions of this Article VI. Notwithstanding the provisions of this Section 6.3, no Underwriter shall be required to indemnify the Company for any amount in excess of the underwriting discounts and commissions applicable to the Securities purchased by such Underwriter. The Underwriters’ obligations in this Section 6.3 to indemnify the Company are several in proportion to their respective underwriting obligations and not joint.
6.4 Contribution.
(a) Contribution Rights. In order to provide for just and equitable contribution under the Securities Act in any case in which (i) any Person entitled to indemnification under this Article VI makes a claim for indemnification pursuant hereto but it is judicially determined (by the entry of a final judgment or decree by a court of competent jurisdiction and the expiration of time to appeal or the denial of the last right of appeal) that such indemnification may not be enforced in such case notwithstanding the fact that this Article VI provides for indemnification in such case, or (ii) contribution under the Securities Act, the Exchange Act or otherwise may be required on the part of any such Person in circumstances for which indemnification is provided under this Article VI, then, and in each such case, the Company and each Underwriter, severally and not jointly, shall contribute to the aggregate losses, liabilities, claims, damages and expenses of the nature contemplated by said indemnity agreement incurred by the Company and such Underwriter, as incurred, in such proportions that such Underwriter is responsible for that portion represented by the percentage that the underwriting discount appearing on the cover page of the Prospectus bears to the initial offering price appearing thereon and the Company is responsible for the balance; provided, that, no Person guilty of a fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from any Person who was not guilty of such fraudulent misrepresentation. For purposes of this Section, each director, officer and employee of such Underwriter or the Company, as applicable, and each Person, if any, who controls such Underwriter or the Company, as applicable, within the meaning of Section 15 of the Securities Act shall have the same rights to contribution as such Underwriter or the Company, as applicable. Notwithstanding the provisions of this Section 6.4, no Underwriter shall be required to contribute any amount in excess of the underwriting discounts and commissions applicable to the Securities purchased by such Underwriter. The Underwriters’ obligations in this Section 6.4 to contribute are several in proportion to their respective underwriting obligations and not joint.
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(b) Contribution Procedure. Within fifteen days after receipt by any party to this Agreement (or its representative) of notice of the commencement of any action, suit or proceeding, such party will, if a claim for contribution in respect thereof is to be made against another party (“contributing party”), notify the contributing party of the commencement thereof, but the failure to so notify the contributing party will not relieve it from any liability which it may have to any other party other than for contribution hereunder. In case any such action, suit or proceeding is brought against any party, and such party notifies a contributing party or its representative of the commencement thereof within the aforesaid fifteen days, the contributing party will be entitled to participate therein with the notifying party and any other contributing party similarly notified. Any such contributing party shall not be liable to any party seeking contribution on account of any settlement of any claim, action or proceeding affected by such party seeking contribution without the written consent of such contributing party. The contribution provisions contained in this Section 6.4 are intended to supersede, to the extent permitted by law, any right to contribution under the Securities Act, the Exchange Act or otherwise available.
ARTICLE VII.
MISCELLANEOUS
7.1 Termination.
(a) Termination Right. The Representative shall have the right to terminate this Agreement at any time prior to the Closing Date or any Option Closing Date, if any, (i) if any domestic or international event or act or occurrence has materially disrupted, or in its opinion will in the immediate future materially disrupt, general securities markets in the United States or Australia; or (ii) if trading on any Trading Market shall have been suspended or halted or materially limited, or minimum or maximum prices for trading shall have been fixed, or maximum ranges for prices for securities shall have been required by FINRA or by order of the Commission or any other government authority having jurisdiction, or (iii) if the United States or Australia shall have become involved in a new war or an increase in major hostilities, or (iv) if a banking moratorium has been declared by a New York State, United States, federal or Australian authority, or (v) if a moratorium on foreign exchange trading has been declared which materially adversely impacts the United States or Australian securities markets, or (vi) if the Company shall have sustained a material loss by fire, flood, accident, hurricane, earthquake, theft, sabotage or other calamity or malicious act which, whether or not such loss shall have been insured, will, in the Representative’s opinion, make it inadvisable to proceed with the delivery of the Securities, or (vii) if the Company is in material breach of any of its representations, warranties or covenants hereunder, or (viii) if the Representative shall have become aware after the date hereof of such a material adverse change in the conditions or prospects of the Company, or such adverse material change in general market conditions as in the Representative’s judgment would make it impracticable to proceed with the offering, sale and/or delivery of the Securities or to enforce contracts made by the Underwriters for the sale of the Securities.
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(b) Dealing in Securities by the Underwriter. The Underwriter hereby agrees (i) to reduce its interest in the Securities to less than 20% of the voting power (as defined in the Corporations Act) within 14 days of acquiring the Securities (ii) not to exercise any voting rights attaching to the Securities in excess of 19.9% of the voting power in the Company without first obtaining the written consent of ASIC and (iii) to use its best efforts to obtain as wide a placement as practicable when reselling the Securities to investors.
(c) Expenses. In the event this Agreement shall be terminated pursuant to Section 7.1(a), within the time specified herein or any extensions thereof pursuant to the terms herein, the Company shall be obligated to pay to the Representative its actual and accountable out of pocket expenses related to the transactions contemplated herein then due and payable, including the fees and disbursements of EGS up to $50,000 (provided, however, that such expense cap in no way limits or impairs the indemnification and contribution provisions of this Agreement).
(d) Indemnification. Notwithstanding any contrary provision contained in this Agreement, any election hereunder or any termination of this Agreement, and whether or not this Agreement is otherwise carried out, the provisions of Article VI shall not be in any way effected by such election or termination or failure to carry out the terms of this Agreement or any part hereof.
7.2 Entire Agreement. The Transaction Documents, together with the exhibits and schedules thereto, and the Prospectus contain the entire understanding of the parties with respect to the subject matter hereof and thereof and supersede all prior agreements and understandings, oral or written, with respect to such matters, which the parties acknowledge have been merged into such documents, exhibits and schedules. Notwithstanding anything herein to the contrary, the Engagement Agreement, dated October 15, 2025, between the Company and the Representative shall continue to be effective and the terms therein shall continue to survive and be enforceable by the Representative in accordance with its terms, including, without limitation, Section 14 therein, provided that, in the event of a conflict between the terms of the Engagement Agreement and this Agreement, the terms of this Agreement shall prevail.
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7.3 Notices. Any and all notices or other communications or deliveries required or permitted to be provided hereunder shall be in writing and shall be deemed given and effective on the earliest of: (a) the date of transmission, if such notice or communication is delivered via facsimile at the facsimile number or email attachment at the email address set forth on the signature pages attached hereto at or prior to 5:30 p.m. (New York City time) on a Trading Day, (b) the next Trading Day after the date of transmission, if such notice or communication is delivered via facsimile at the facsimile number or email attachment at the email address as set forth on the signature pages attached hereto on a day that is not a Trading Day or later than 5:30 p.m. (New York City time) on any Trading Day, (c) the second (2nd) Trading Day following the date of mailing, if sent by U.S. nationally recognized overnight courier service or (d) upon actual receipt by the party to whom such notice is required to be given. The address for such notices and communications shall be as set forth on the signature pages attached hereto.
7.4 Amendments; Waivers. No provision of this Agreement may be waived, modified, supplemented or amended except in a written instrument signed, in the case of an amendment, by the Company and the Representative. No waiver of any default with respect to any provision, condition or requirement of this Agreement shall be deemed to be a continuing waiver in the future or a waiver of any subsequent default or a waiver of any other provision, condition or requirement hereof, nor shall any delay or omission of any party to exercise any right hereunder in any manner impair the exercise of any such right.
7.5 Headings. The headings herein are for convenience only, do not constitute a part of this Agreement and shall not be deemed to limit or affect any of the provisions hereof.
7.6 Successors and Assigns. This Agreement shall be binding upon and inure to the benefit of the parties and their successors and permitted assigns.
7.7 Governing Law. All questions concerning the construction, validity, enforcement and interpretation of the Transaction Documents shall be governed by and construed and enforced in accordance with the internal laws of the State of New York, without regard to the principles of conflicts of law thereof. Each party agrees that all legal proceedings concerning the interpretations, enforcement and defense of the transactions contemplated by this Agreement and any other Transaction Documents (whether brought against a party hereto or its respective affiliates, directors, officers, shareholders, partners, members, employees or agents) shall be commenced exclusively in the state and federal courts sitting in the City of New York. Each party hereby irrevocably submits to the exclusive jurisdiction of the state and federal courts sitting in the City of New York, Borough of Manhattan (collectively, the “Specified Courts”) for the adjudication of any dispute hereunder or in connection herewith or with any transaction contemplated hereby or discussed herein (including with respect to the enforcement of any of the Transaction Documents), and hereby irrevocably waives, and agrees not to assert in any action, suit or proceeding, any claim that it is not personally subject to the jurisdiction of any such court, that such suit, action or proceeding is improper or is an inconvenient venue for such proceeding. Each party hereby irrevocably waives personal service of process and consents to process being served in any such suit, action or proceeding by mailing a copy thereof via registered or certified mail or overnight delivery (with evidence of delivery) to such party at the address in effect for notices to it under this Agreement and agrees that such service shall constitute good and sufficient service of process and notice thereof. The Company hereby irrevocably designates and appoints Vcorp Services, LLC, located at 25 Robert Pitt Drive, Suite 204, Monsey, New York, 10952 (the “Process Agent”) as its authorized agent upon whom process may be served in any claim brought against the Company, it being understood that the designation and appointment of the Process Agent as such authorized agent shall become effective immediately without any further action on the part of the Company. The Company represents to each Underwriter that it has notified the Process Agent of such designation and appointment and that the Process Agent has accepted the same. The Company hereby irrevocably authorizes and directs the Process Agent to accept such service. The Company further agrees that service of process upon the Process Agent and written notice of said service to the Company, mailed by first-class mail and delivered to the Process Agent, shall be deemed in every respect effective service of process upon the Company in any such claim. Nothing contained herein shall be deemed to limit in any way any right to serve process in any other manner permitted by law. If either party shall commence an action or proceeding to enforce any provisions of the Transaction Documents, then, in addition to the obligations of the Company under Article VI, the prevailing party in such action, suit or proceeding shall be reimbursed by the other party for its reasonable attorneys’ fees and other costs and expenses incurred with the investigation, preparation and prosecution of such action or proceeding. Nothing herein shall affect the right of each Underwriter, its partners, directors, officers and members, any person who controls any Underwriter within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act, or any “affiliate” (within the meaning of Rule 405 under the Securities Act) of such Underwriter, or the successors and assigns of all of the foregoing persons, to serve process in any other manner permitted by law. Notwithstanding the foregoing, any action arising out of or based upon this Agreement may be instituted by any Underwriter, the directors, officers, employees and agents of any Underwriter, or by any person who controls any Underwriter, in any court of competent jurisdiction in Australia. The provisions of this Section 7.7 shall survive any termination of this Agreement, in whole or in part.
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7.8 Survival. The representations and warranties contained herein shall survive the Closing and the Option Closing, if any, and the delivery of the Securities.
7.9 Execution. This Agreement may be executed in two or more counterparts, all of which when taken together shall be considered one and the same agreement and shall become effective when counterparts have been signed by each party and delivered to each other party, it being understood that the parties need not sign the same counterpart. In the event that any signature is delivered by facsimile transmission or by e-mail delivery of a “.pdf” format data file, such signature shall create a valid and binding obligation of the party executing (or on whose behalf such signature is executed) with the same force and effect as if such facsimile or “.pdf” signature page were an original thereof.
7.10 Severability. If any term, provision, covenant or restriction of this Agreement is held by a court of competent jurisdiction to be invalid, illegal, void or unenforceable, the remainder of the terms, provisions, covenants and restrictions set forth herein shall remain in full force and effect and shall in no way be affected, impaired or invalidated, and the parties hereto shall use their commercially reasonable efforts to find and employ an alternative means to achieve the same or substantially the same result as that contemplated by such term, provision, covenant or restriction. It is hereby stipulated and declared to be the intention of the parties that they would have executed the remaining terms, provisions, covenants and restrictions without including any of such that may be hereafter declared invalid, illegal, void or unenforceable.
7.11 Remedies. In addition to being entitled to exercise all rights provided herein or granted by law, including recovery of damages, the Underwriters and the Company will be entitled to specific performance under the Transaction Documents. The parties agree that monetary damages may not be adequate compensation for any loss incurred by reason of any breach of obligations contained in the Transaction Documents and hereby agree to waive and not to assert in any action for specific performance of any such obligation the defense that a remedy at law would be adequate.
7.12 Saturdays, Sundays, Holidays, etc. If the last or appointed day for the taking of any action or the expiration of any right required or granted herein shall not be a Business Day, then such action may be taken or such right may be exercised on the next succeeding Business Day.
7.13 Construction. The parties agree that each of them and/or their respective counsel have reviewed and had an opportunity to revise the Transaction Documents and, therefore, the normal rule of construction to the effect that any ambiguities are to be resolved against the drafting party shall not be employed in the interpretation of the Transaction Documents or any amendments thereto. In addition, each and every reference to share or ADS prices and Ordinary Shares in any Transaction Document shall be subject to adjustment for reverse and forward stock splits, stock dividends, stock combinations and other similar transactions of the Ordinary Shares that occur after the date of this Agreement.
7.14 WAIVER OF JURY TRIAL. IN ANY ACTION, SUIT, OR PROCEEDING IN ANY JURISDICTION BROUGHT BY ANY PARTY AGAINST ANY OTHER PARTY ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY, THE PARTIES EACH KNOWINGLY AND INTENTIONALLY, TO THE GREATEST EXTENT PERMITTED BY APPLICABLE LAW, HEREBY ABSOLUTELY, UNCONDITIONALLY, IRREVOCABLY AND EXPRESSLY WAIVE FOREVER ANY RIGHT TO TRIAL BY JURY.
(Signature Pages Follow)
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If the foregoing correctly sets forth the understanding between the Underwriters and the Company, please so indicate in the space provided below for that purpose, whereupon this letter shall constitute a binding agreement among the Company and the several Underwriters in accordance with its terms.
| Very truly yours, | |||
| CHILWA MINERALS LIMITED. | |||
| By: | |||
| Name: | Cadell Buss | ||
| Title: | Managing Director | ||
| By: | |||
| Name: | Susan Park | ||
| Title: | Company Secretary | ||
Address for Notice:
Level 28, 140 St Georges Terrace
Perth, WA 4000
Australia
Email: cbuss@chilwaminerals.com.au
Copy to: andrew.reilly@rimonlaw.com
| Accepted on the date first above written. | ||
| MAXIM GROUP LLC | ||
| As the Representative of the several | ||
| Underwriters listed on Schedule I | ||
| By: | ||
| Name: | ||
| Title: | ||
Address for Notice:
Copy to:
Ellenoff Grossman & Schole LLP
1345 Avenue of the Americas
New York, New York 10105
Attention: Matthew Bernstein, Esq.
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SCHEDULE I
Schedule of Underwriters
| Underwriters | Closing ADSs for Company Investors | Closing Warrants for Company Investors | Closing ADSs for other Investors | Closing Warrants for other Investors | Aggregate Closing Purchase Price | ||||||||||||||||
| Total: | |||||||||||||||||||||
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SCHEDULE II
Schedule of Company investors
[Company to provide]
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EXHIBIT A
Issuer-Represented General Free Writing Prospectus
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Exhibit B
Form of Lock-Up Agreement
54
Exhibit C
Representative’s Warrant
55
Exhibit D
Warrant Agency Agreement
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Exhibit 4.5
ADS WARRANT AGENT AGREEMENT
ADS WARRANT AGENT AGREEMENT (this “Warrant Agreement”) dated as of August [●], 2026 (the “Issuance Date”) between Chilwa Minerals Limited (ACN 656 965 589), an Australian corporation (the “Company”), and Computershare Inc., a Delaware corporation (“Computershare”), and its Affiliate, Computershare Trust Company, N.A., a federally chartered trust company, collectively as Warrant Agent (the “Warrant Agent”).
WHEREAS, the Company is engaged in a public offering (the “Offering”) of up to American Depositary Shares (“ADSs”), each representing ten (10) ordinary shares of the Company (“Ordinary Shares”), and up to Warrants (the “Warrants”), with each such Warrant representing the right of the holder thereof to purchase one ADS (each, a “Warrant ADS”) for US$ , subject to adjustment as described herein, plus any applicable fees, charges and taxes;
WHEREAS, the ADSs are issuable under the Deposit Agreement dated as of , 2026 (as the same may be amended from time to time, the “Deposit Agreement”), among the Company, The Bank of New York Mellon, as depositary (the “Depositary”), and all Owners and Holders (each as defined in the Deposit Agreement) from to time of the ADSs issued thereunder;
WHEREAS, the Company has filed with the Securities and Exchange Commission a Registration Statement, No. 333-297336 on Form F-1 (as the same may be amended from time to time, the “Registration Statement”) for the registration, under the Securities Act of 1933, as amended (the “Act”) of, among other securities, the Warrants and the Ordinary Shares represented by the Warrant ADSs (the “Warrant Shares”), and such Registration Statement was declared effective on August [●], 2026;
WHEREAS, the Company desires the Warrant Agent to act on behalf of the Company, and the Warrant Agent is willing to so act, in connection with the issuance, registration, transfer, exchange and exercise of the Warrants;
WHEREAS, the Company desires to provide for the provisions of the Warrants, the terms upon which they shall be issued and exercised, and the respective rights, limitation of rights, and immunities of the Company, the Warrant Agent, and the holders of the Warrants; and
WHEREAS, all acts and things have been done and performed which are necessary to make the Warrants the valid, binding and legal obligations of the Company, and to authorize the execution and delivery of this Warrant Agreement.
NOW, THEREFORE, in consideration of the mutual agreements herein contained, the parties hereto agree as follows:
1. Appointment of Warrant Agent. The Company hereby appoints the Warrant Agent to act as agent for the Company with respect to the Warrants, and the Warrant Agent hereby accepts such appointment and agrees to perform the same in accordance with the express terms and conditions set forth in this Warrant Agreement (and no implied terms or conditions).
2. Warrants.
2.1. Warrant. The Warrants shall be registered securities and shall be evidenced by a global certificate (“Global Certificate”) in the form of Annex A to this Warrant Agreement., which shall be deposited on behalf of the Company with The Depository Trust Company (“DTC”) and registered in the name of Cede & Co., a nominee of DTC. If DTC subsequently ceases to make its book-entry settlement system available for the Warrants, the Company may instruct the Warrant Agent regarding making other arrangements for book-entry settlement. In the event that the Warrants are not eligible for, or it is no longer necessary to have the Warrants available in, book-entry form, the Warrant Agent shall provide written instructions to the DTC to deliver to the Warrant Agent for cancellation the Global Certificate, and the Company shall instruct the Warrant Agent to deliver to DTC definitive certificates (“Definitive Certificates” and, together with the Global Certificate, “Warrant Certificates”) representing the Warrants in physical form.
2.2. Issuance and Registration of Warrants.
2.2.1. Warrant Register. Upon the receipt of all relevant information from the Company, the Warrant Agent shall maintain books (“Warrant Register”) for the registration of original issuance and the registration of transfer of the Warrants.
2.2.2. Issuance of Warrants. Upon the initial issuance of the Warrants, the Warrant Agent shall issue and register the Warrants in the names of the respective holders thereof in such denominations and otherwise in accordance with written instructions delivered to the Warrant Agent by the Company. Ownership of beneficial interests in the Warrants shall be shown on, and the transfer of such ownership shall be effected through, records maintained (i) by DTC and (ii) by institutions that have accounts with DTC (each, a “Participant”).
2.2.3. Beneficial Owner; Holder. The term “beneficial owner” shall mean any person whose ownership in the Warrants evidenced by the Global Certificate is recorded in the records maintained by DTC or its nominee or in the records of the Participants. Prior to due presentment for registration of transfer of any Warrant, the Company and the Warrant Agent may deem and treat the person in whose name the warrant shall be registered upon the Warrant Register (the “Holder”) as the absolute owner of such Warrant for all purposes and neither the Company nor the Warrant Agent shall be affected by any notice to the contrary. Notwithstanding the foregoing, nothing herein shall prevent the Company, the Warrant Agent or any agent of the Company or the Warrant Agent from giving effect to any written certification, proxy or other authorization furnished by DTC governing the exercise of the rights of a holder of a beneficial interest in any Warrant. The rights of beneficial owners in a Warrant shall be exercised through the DTC subject to the applicable procedures of DTC except to the extent set forth herein or in a Global Certificate.
2.2.4. Execution. The Global Certificate shall be executed on behalf of the Company by any two (2) authorized officers of the Company (each, an “Authorized Officer”) either manually or by facsimile or other electronic signature. The Global Certificate shall be countersigned by an authorized signatory of the Warrant Agent either manually or by facsimile or other electronic signature and the Global Certificate shall not be valid for any purpose unless so countersigned. In case any Authorized Officer of the Company that signed any of the Global Certificate ceases to be an Authorized Officer of the Company before countersignature by the Warrant Agent and issuance and delivery by the Company, such Global Certificate, nevertheless, may be countersigned by the Warrant Agent, issued and delivered with the same force and effect as though the person who signed such Global Certificate had not ceased to be such officer of the Company.
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2.2.5. Registration of Transfer. At any time at or prior to the Expiration Date (as defined below), a transfer of a beneficial interest in any Warrants may be registered and any Warrant may be split up, combined or exchanged for another Warrant evidencing the same number of Warrants as the Warrant surrendered. Any Holder desiring to register the transfer of Warrants or to split up, combine or exchange any Warrant shall make such request in writing delivered to the Warrant Agent, and, in the case of Definitive Certificates, shall surrender to the Warrant Agent the Warrant Certificate or Warrant Certificates evidencing the Warrants that are to be split up, combined or exchanged together with any required form of assignment and certificate duly executed and properly completed by such Holder at the office or offices of the Warrant Agent designated for such purpose and, in the case of registration of transfer, shall provide a signature guarantee (a “Signature Guarantee”) from an eligible guarantor institution participating in a signature guarantee program approved by the Securities Transfer Association and such other documentation as the Warrant Agent may reasonably request. Thereupon, the Warrant Agent shall countersign and deliver to the person entitled thereto a new Warrant so requested. The Company, shall pay, on behalf of the holder of Warrant requesting a registration of transfer of Warrants or a split-up, combination or exchange of a Warrant, a sum sufficient to cover any tax or governmental charge that may be imposed in connection with such registration of transfer, split-up, combination or exchange, together with reimbursement of all reasonable expenses of the Warrant Agent incidental thereto. The Warrant Agent shall not have any duty or obligation to take any action under any section of this Warrant Agreement that requires the payment of taxes and/or charges unless and until it is satisfied that all such payments have been made.
2.2.6. Limitation on transfer. At any time in the 12 months from the Issuance Date, the Holder shall not knowingly transfer any Warrants, or any interest in any Warrants, to any person resident in Australia, unless the transfer can be undertaken without disclosure to that person in accordance with section 708 of the Corporations Act 2001 of the Commonwealth of Australia (the “Corporations Act”).
2.2.7. Loss, Theft and Mutilation of Warrant Certificates. Upon receipt by the Company and the Warrant Agent of evidence reasonably satisfactory to them of the loss, theft, destruction or mutilation of a Warrant Certificate, and, in case of loss, theft or destruction, on such terms as to indemnity or otherwise as they may in their discretion impose (which terms shall in all cases include posting of an open penalty surety bond satisfactory to the Warrant Agent and holding it and Company harmless) and reimbursement to the Company and the Warrant Agent of all reasonable expenses incidental thereto, and upon surrender to the Warrant Agent and cancellation of the Warrant Certificate if mutilated, absent notice to the Warrant Agent that such certificates have been acquired by a bona fide purchaser, the Warrant Agent shall, on behalf of the Company, countersign and deliver a new Warrant Certificate of like tenor to the Holder in lieu of the Warrant Certificate so lost, stolen, destroyed or mutilated. The Warrant Agent may receive compensation from the surety companies or surety agents for administrative services provided to them.
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2.2.8. Proxies. The Holder of a Warrant may grant proxies or otherwise authorize any person, including the Participants and beneficial holders that may own interests through the Participants, to take any action that a Holder is entitled to take under this Warrant Agreement or the Warrants. provided, however, that at all times that the Warrants are represented by a Global Certificate, exercise of the Warrants by holders of beneficial interests in the Global Certificate shall be effected on their behalf by Participants through DTC in accordance the procedures administered by DTC.
3. Terms and Exercise of Warrants.
3.1. Exercise Price. Each Warrant shall entitle the Holder, subject to the provisions of the Global Certificate and of this Warrant Agreement, to purchase from the Company the number of ADSs stated therein, at the price of US$[●] per whole ADS, subject to the subsequent adjustments provided in Section 4 hereof. The term “Exercise Price” as used in this Warrant Agreement refers to the price per ADS at which ADSs may be purchased at the time a Warrant is exercised. Notwithstanding any provision to the contrary in the Deposit Agreement, the Company shall pay to the Warrant Agent the Depositary’s fee of US$0.10 per ADS for issuance of ADSs (the “Issuance Fee”) and an amount sufficient to cover all applicable taxes and charges due in connection with the exercise of such Warrants (the “Additional Expenses”). The Depositary will invoice the Company monthly for those fees as incurred.
3.2. Duration of Warrants. A Warrant may be exercised only during the period (“Exercise Period”) commencing on the Issuance Date and terminating at 5:00 P.M., New York City time (the “close of business”) on August [●], 2031 (“Expiration Date”). Each Warrant not exercised on or before the Expiration Date shall become void, and all rights thereunder and all rights in respect thereof under this Warrant Agreement shall cease at the close of business on the Expiration Date.
3.3. Exercise of Warrants.
3.3.1. Exercise and Payment.
3.3.1.1. Subject to the provisions of this Warrant Agreement, either a Holder (or a Participant acting on behalf of a Holder in accordance with DTC procedures) may exercise a Warrant by delivering, not later than 5:00 P.M., New York time, on any business day during the Exercise Period (the “Exercise Date”) (i) the Warrants to be exercised by delivery of the Warrant to an account of the Warrant Agent at DTC designated for such purpose in writing by the Warrant Agent to DTC from time to time, (ii) an election to purchase the Warrant ADSs underlying the Warrants to be exercised via an electronic warrant exercise through the DTC system (an “Election to Purchase”) and (iii) the Exercise Price for each Warrant to be exercised in lawful money of the United States of America by (A) certified or official bank check payable to Computershare Inc., (B) by bank wire transfer in immediately available funds to Computershare Inc., ABA #: [please insert], Account Number: [please insert], Account Name: [please insert], Ref.: Chilwa Warrants - [please insert], Swift Code [please insert] or (C) payment to the Warrant Agent through the DTC system. In the event of a cash exercise, the Company hereby instructs the Warrant Agent to record cost basis for newly issued Shares in a manner to be subsequently communicated by the Company in writing to the Warrant Agent.
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3.3.1.2. If any of (i) the Warrants, (ii) the Election to Purchase, or (iii) the Exercise Price therefor, is received by the Warrant Agent after 5:00 P.M., New York time, on any date, or on a date that is not a trading day on The Nasdaq Stock Market LLC (a “Trading Day”), the Warrants with respect thereto will be deemed to have been received and exercised on the Trading Day next succeeding such date. The “Exercise Date” will be the date the materials in the foregoing sentence are received by the Warrant Agent (if by 5:00 P.M., New York time), or the following trading day (if after 5:00 P.M., New York time), regardless of any earlier date written on the materials. If the Warrants are received or deemed to be received after the Expiration Date, the exercise thereof will be invalid and any funds delivered to the Warrant Agent will be returned to the Holder or Participant, as the case may be, as soon as practicable. In no event will interest accrue on any funds deposited with the Warrant Agent in respect of an exercise or attempted exercise of Warrants.
3.3.1.3. All funds received by Computershare under this Warrant Agreement that are to be distributed or applied by Computershare in the performance of Services (the “Funds”) shall be held by Computershare as agent for the Company and deposited in one or more bank accounts to be maintained by Computershare in its name as agent for the Company. Until paid pursuant to this Warrant Agreement, Computershare may hold or invest the Funds through such accounts in: (a) funds backed by obligations of, or guaranteed by, the United States of America; (b) debt or commercial paper obligations rated A-1 or P-1 or better by S&P Global Inc. (“S&P”) or Moody’s Investors Service, Inc. (“Moody’s”), respectively; (c) Government and Treasury backed AAA-rated Fixed NAV money market funds that comply with Rule 2a-7 of the Investment Company Act of 1940, as amended; or (d) short term certificates of deposit, bank repurchase agreements, and bank accounts with commercial banks with Tier 1 capital exceeding $1 billion, or with an investment grade rating by S&P (LT Local Issuer Credit Rating), Moody’s (Long Term Rating) and Fitch Ratings, Inc. (LT Issuer Default Rating) (each as reported by Bloomberg Finance L.P.). Computershare shall have no responsibility or liability for any diminution of the Funds that may result from any deposit or investment made by Computershare in accordance with this paragraph, including any losses resulting from a default by any bank, financial institution or other third party. Computershare may from time to time receive interest, dividends or other earnings in connection with such deposits or investments. Computershare shall not be obligated to pay such interest, dividends or earnings to the Company, any holder or any other party. The Warrant Agent shall forward funds received for warrant exercises in a given month by the 5th business day of the following month by wire transfer to an account designated by the Company.
3.3.2. Issuance of Warrant Shares.
3.3.2.1. The Warrant Agent shall as soon as practicable following the Exercise Date of any Warrant, advise the Company, the registrar for Ordinary Shares and the Depositary, in respect of (i) the number of Warrant Shares indicated on the Election to Purchase as issuable upon such exercise with respect to such exercised Warrants, (ii) the instructions of the Holder or Participant provided to the Warrant Agent with respect to the delivery of the Warrant ADSs and (iii) such other information as the Company or the Depositary shall reasonably request.
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3.3.2.2. The Company shall, by no later than 5:00 P.M., New York time, on the third Trading Day following the Exercise Date of any Warrant and the clearance of the funds in payment of the Exercise Price (such date and time, the “Delivery Time”), cause its registrar to deliver the Warrant Shares issuable upon exercise to the Depositary’s Australian custodian who, on the date of this Warrant Agreement, is HSBC Bank Australia Limited, for deposit under the Deposit Agreement and (iii) cause the Depositary to deliver the Warrant ADSs issuable upon that deposit as requested in the Election to Purchase pursuant to the Holder’s instruction through the DTC system.
3.3.3. Valid Issuance. All Warrant Shares issuable by the Company upon the valid exercise of a Warrant in conformity with this Warrant Agreement shall be validly issued and credited as fully paid.
3.3.4. No Fractional Exercise. No fractional Warrant ADSs will be issued upon the exercise of the Warrant, but rather the Company shall adjust the number of Warrant Shares issued up or down to the nearest integral multiple of the number of Ordinary Shares at the time represented by one ADS.
3.3.5. Transfer Taxes. The Company shall pay any stamp or other tax or charge required to be paid in connection with any transfer involved in the issue of the Warrant ADSs or Warrant Shares upon the exercise of Warrants.
3.3.6. Date of Issuance. The Company will treat an exercising Holder as a beneficial owner of the Warrant Shares as of the Exercise Date, except that, if the Exercise Date is a date when the share transfer books of the Company are closed, such person shall be deemed to have become the holder of such shares at the open of business on the next succeeding date on which the share transfer books are open. However, it is understood and agreed that Warrant ADSs will not be registered or issued until the Depositary receives notice from its custodian that the Warrant Shares have been deposited under the Deposit Agreement; provided further, however, it is acknowledged and agreed that the Company shall take all reasonable steps to ensure the Warrant ADSs are delivered to the Holder on or prior to the Delivery Time in accordance with Section 3.3.2(b) hereof.
3.3.7. Restrictive Legend Events. The Company will use its reasonable best efforts to maintain the effectiveness of the Registration Statement and the current status of the prospectus included therein or to file and maintain the effectiveness of another registration statement and another current prospectus covering the Warrants and the Warrant Shares at any time that the Warrants are exercisable. The Company shall provide to the Warrant Agent and each Holder prompt written notice of any time that the Company is unable to deliver the Warrant ADSs via DTC transfer or otherwise (without restrictive legend), because (a) the Commission has issued a stop order with respect to the Registration Statement, (b) the Commission otherwise has suspended or withdrawn the effectiveness of the Registration Statement, either temporarily or permanently, (c) the Company has suspended or withdrawn the effectiveness of the Registration Statement, either temporarily or permanently, or (d) otherwise (each a “Restrictive Legend Event”). To the extent that a Restrictive Legend Event occurs after a Holder has exercised Warrants in accordance with the terms of the Warrants but prior to the delivery of the Warrant ADSs, the Company shall compensate the Holder pursuant to Section 6.6 hereof.
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3.3.8. Disputes. In the case of a dispute as to the determination of the Exercise Price or the arithmetic calculation of the Warrant ADSs, the Company shall promptly cause delivery to the Holder of the number of Warrant ADSs that are not disputed.
3.3.9. Beneficial Ownership. Notwithstanding anything to the contrary contained herein, the Holder shall not have the right to exercise any portion of a Warrant pursuant to the terms and conditions of this Warrant Agreement and the Global Certificate, and any such exercise shall be null and void and treated as if never made, to the extent that, after giving effect to such exercise, a beneficial owner of the Warrants, together with the other Attribution Parties (as defined below) of such beneficial owner collectively would beneficially own in excess of 4.99% (the “Maximum Percentage”) of the number of Ordinary Shares outstanding immediately after giving effect to such exercise. To the extent that the limitation contained in this Section 3.3.9 applies, the determination of whether a Warrant is exercisable and of which portion of a Warrant is exercisable shall be in the sole discretion of the Holder and the submission of an Election to Purchase shall be deemed to be the Holder’s representation as to whether a Warrant is exercisable and the Company shall have no obligation to verify or confirm the accuracy of such determination. For purposes of the foregoing sentence, the aggregate number of Ordinary Shares beneficially owned by the beneficial owner and the other Attribution Parties shall include the number of Ordinary Shares held by the beneficial owner and all other Attribution Parties plus the number of Ordinary Shares issuable upon exercise of this Warrant with respect to which the determination of such sentence is being made, but shall exclude the number of Ordinary Shares which would be issuable upon (A) exercise of the remaining, unexercised portion of a Warrant beneficially owned by such beneficial owner or any of the other Attribution Parties and (B) exercise or conversion of the unexercised or unconverted portion of any other securities of the Company beneficially owned by such beneficial owner or any other Attribution Party subject to a limitation on conversion or exercise analogous to the limitation contained in this Section 3.3.9. For purposes of this Section 3.3.9, beneficial ownership shall be calculated in accordance with Section 13(d) of the Securities Exchange Act of 1934, as amended (the “1934 Act”). For purposes of a Warrant, in determining the number of outstanding Ordinary Shares a Holder may acquire upon the exercise of this Warrant without exceeding the Maximum Percentage, a beneficial owner may rely on the number of outstanding Ordinary Shares as reflected in (x) the Company’s most recent public filing with the Securities and Exchange Commission (the “SEC”) (y) a more recent public announcement by the Company or (3) any other written notice by the Company setting forth the number of Ordinary Shares outstanding (the “Reported Outstanding Share Number”). For any reason at any time, upon the written or oral request of a Holder, the Company shall within one (1) Business Day confirm orally and in writing or by electronic mail to the Holder, the number of Ordinary Shares then outstanding. In any case, the number of outstanding Ordinary Shares shall be determined after giving effect to the conversion or exercise of securities of the Company, including this Warrant, by the beneficial owner and any other Attribution Party since the date as of which the Reported Outstanding Share Number was reported. In the event that the issuance of Ordinary Shares to the Holder upon exercise of this Warrant results in the beneficial owner and the other Attribution Parties being deemed to beneficially own, in the aggregate, more than the Maximum Percentage of the number of outstanding Ordinary Shares (as determined under Section 13(d) of the 1934 Act), the number of shares so issued by which the aggregate beneficial ownership of the beneficial owner or Attribution Parties exceeds the Maximum Percentage (the “Excess Shares”) shall be deemed null and void and shall be cancelled ab initio, and the Holder shall not have the power to vote or to transfer the ADSs representing the Excess Shares. As soon as reasonably practicable after the issuance of the Excess Shares has been deemed null and void, the Company shall return to the Holder the exercise price paid for the Excess Shares. Upon delivery of a written notice to the Company, the Holder may from time to time increase (with such increase not effective until the sixty-first (61st) day after delivery of such notice) or decrease the Maximum Percentage to any other percentage not in excess of 9.99% as specified in such notice; provided that (i) any such increase in the Maximum Percentage will not be effective until the sixty-first (61st) day after such notice is delivered to the Company and (ii) any such increase or decrease will apply only to the beneficial owner and the other Attribution Parties and not to any other holder of Warrants that is not an Attribution Party of the beneficial owner. For purposes of clarity, the Ordinary Shares issuable pursuant to the terms of this Warrant in excess of the Maximum Percentage shall not be deemed to be beneficially owned by the beneficial owner for any purpose including for purposes of Section 13(d) or Rule 16a-1(a)(1) of the 1934 Act. No prior inability to exercise this Warrant pursuant to this paragraph shall have any effect on the applicability of the provisions of this paragraph with respect to any subsequent determination of exercisability. The provisions of this paragraph shall be construed and implemented in a manner otherwise than in strict conformity with the terms of this Section 3.3.9 to the extent necessary to correct this paragraph or any portion of this paragraph which may be defective or inconsistent with the intended beneficial ownership limitation contained in this Section 3.3.9 or to make changes or supplements necessary or desirable to properly give effect to such limitation. The limitation contained in this paragraph may not be waived and shall apply to a successor holder of this Warrant.
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For purposes of this Section 3.3.9, “Attribution Parties” means, collectively, the following persons and entities: (i) any investment vehicle, including, any funds, feeder funds or managed accounts, currently, or from time to time after the Issuance Date, directly or indirectly managed or advised by a beneficial owner’s investment manager or any of its affiliates or principals, (ii) any direct or indirect affiliates of the beneficial owner or any of the foregoing, (iii) any person acting or who could be deemed to be acting as a group (as such term is used in Section 13(d) of the 1934 Act and defined in Rule 13d-5 thereunder) together with the beneficial owner or any of the foregoing and (iv) any other persons whose beneficial ownership of the Company’s Ordinary Shares would or could be aggregated with the beneficial owner’s and the other Attribution Parties for purposes of Section 13(d) of the 1934 Act. For clarity, the purpose of the foregoing is to subject collectively the beneficial owner and all other Attribution Parties to the Maximum Percentage.
4. Adjustment of Exercise Price and Number of Warrants. The Exercise Price per Warrant and the number of Warrants held shall be subject to adjustment from time to time after the Issuance Date in accordance with the Official Listing Rules of the Australian Securities Exchange (“ASX Listing Rules”) upon the occurrence of certain events described in this Section 4 or, if the ASX Listing Rules are amended after the date of issue of the Warrants, in accordance with the Company’s obligations under the ASX Listing Rules to the extent those obligations are modified by the amendment.
4.1. Subdivision or Combination; Capital Distributions; Other Adjustments.
4.1.1. In a consolidation of the Company’s ordinary capital – the number of Warrants will be consolidated in the same ratio as the ordinary capital and the Exercise Price will be amended in inverse proportion to that ratio.
4.1.2. In a sub-division of the Company’s ordinary capital – the number of Warrants will be sub-divided in the same ratio as the ordinary capital and the Exercise Price will be amended in inverse proportion to that ratio.
4.1.3. In a return of capital on Ordinary Shares – the number of Warrants will remain the same, and the Exercise Price of each Warrant will be reduced by the same amount as the amount of cash or value of shares, securities, or other property returned in relation to each Ordinary Share, multiplied by the number of Ordinary Shares represented by each ADS (the “ADS Ratio”).
4.1.4. In a reduction of the Company’s capital by a cancellation of paid up capital that is lost or not represented by available assets where no securities are cancelled – the number of Warrants and the Exercise Price of each Warrant will remain unaltered.
4.1.5. In a pro rata cancellation of the Company’s capital on Ordinary Shares – the number of Warrants will be reduced in the same ratio as the ordinary capital and the Exercise Price of each Warrant will be amended in inverse proportion to that ratio.
4.1.6. In any other case – the number of Warrants or the Exercise Price, or both, will be reorganized in accordance with the ASX Listing Rules so that the holder of the Warrants will not receive a benefit that holders of Ordinary Shares do not receive.
4.2. Bonus Shares and Share dividends. If there is a pro-rata bonus issue, or a pro-rata dividend to be paid only in Ordinary Shares, to the holders of issued Ordinary Shares, the number of Warrant ADSs upon exercise will be increased by the number of ADSs which the holder of the Warrant would have received if the Warrant had been exercised before the record date for the bonus issue or share dividend.
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4.3. Pro-rata Issues. If there is a pro-rata offer of Ordinary Shares (other than a bonus issue) to the holders of Ordinary Shares (i.e. a rights offer), the Exercise Price will be reduced in accordance with the following formula:
| O’ | = | O - E [P – (S – D)] | |
| N + 1 |
Where:
O’ is the new Exercise Price
O is the old Exercise Price
E is the number of Ordinary Shares underlying the Warrant ADSs into which one Warrant is exercisable
P is the volume weighted average market price per Ordinary Share on the Australian Securities Exchange (“ASX”) over the 5 ASX trading days ending on the ASX trading day before the ex rights or ex entitlement date for the pro rata issue
S is the subscription price for one Ordinary Share under the pro rata offer
D is the dividend (if any) due but not yet paid on an existing Ordinary Shares which will not be paid on the new Ordinary Shares to be issued in the pro rata issue
N is the number of Ordinary Shares that must be held on the record date for the pro rata issue to receive a right or entitlement to subscribe for one new Ordinary Share.
For the avoidance of doubt, if the formula results in no decrease in the Exercise Price, then the Exercise Price remains unchanged.
4.4. Change in ADS Ratio. If after the Issuance Date the ADS Ratio is increased or reduced, then the number of Warrant ADSs to be issued on exercise of a Warrant will be reduced or increased (respectively) in inverse proportion to the change in the ADS Ratio Ordinary Shares per ADS and the Exercise Price per Warrant will be increased or reduced (respectively) in proportion to the change in Ordinary Shares per ADS, so that the total number or Warrant Shares underlying the Warrants and the aggregate Exercise Price for all Warrants remain unchanged.
4.5. Notice of Adjustment. Upon any adjustment of the Exercise Price, and/or any increase or decrease in the number of Warrants, and/or any increase or decrease in the number of ADSs issuable upon the exercise of the Warrants, the Company shall give written notice thereof to the Warrant Agent and Holder. The notice shall state the Exercise Price resulting from such adjustment and the increase or decrease, if any, in the number of Warrant ADSs issuable at such price upon the exercise of the Warrant, setting forth in reasonable detail the method of calculation and the facts upon which such calculation is based. The Company further agrees that it will provide the Warrant Agent with any new or amended exercise terms. The Warrant Agent shall have no obligation under this Warrant Agreement to determine whether an Adjustment Event has occurred or to calculate any of the adjustments set forth herein.
4.6. Other Notices. If at any time:
4.6.1. the Company shall declare any cash dividend upon its Ordinary Shares;
4.6.2. the Company shall declare any dividend upon its Ordinary Shares payable in shares or make any special dividend or other distribution to the holders of its Ordinary Shares;
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4.6.3. there shall be any capital reorganization or reclassification of the capital of the Company, or consolidation or merger of the Company with, or sale of all or substantially all of its assets to, another entity;
4.6.4. there shall be a voluntary or involuntary dissolution, liquidation or winding-up of the Company; or
4.6.5. the Company shall take or propose to take any other corporate action, prior notice of which is actually provided to holders of the Ordinary Shares;
then, in any one or more of said cases, the Company shall give to the Warrant Agent, (i) at least ten days’ prior written notice of the date on which the books of the Company shall close or a record shall be taken for such dividend, distribution or subscription rights or for determining rights to vote in respect of any such reorganization, reclassification, consolidation, merger, sale, dissolution, liquidation or winding-up, or other action and (ii) in the case of any such reorganization, reclassification, consolidation, merger, sale, dissolution, liquidation or winding-up, or other action, at least ten days’ written notice of the date when the same shall take place. Any notice given in accordance with the foregoing clause (i) shall also specify, in the case of any such dividend, distribution or subscription rights, the date on which the distribution will be made to holders of the Ordinary Shares.
5. Restrictive Legends; Fractional Warrants.
In the event that transfer of a Warrant bears a restrictive legend in the DTC system, the Warrant Agent shall not cancel such Warrant and deliver a new unrestricted Warrant in exchange therefor until the Warrant Agent has received an opinion of counsel for the Company stating that such transfer may be made and indicating whether the Warrants must also bear a restrictive legend upon that transfer. The Warrant Agent shall not be required to effect any registration of transfer or exchange which will result in the transfer of or delivery of a fraction of a Warrant.
6. Other Provisions Relating to Rights of Holders of Warrants.
6.1. No Rights as Shareholder. Except as otherwise specifically provided herein, a Holder, solely in its capacity as a holder of Warrants, shall not be entitled to vote or receive dividends or be deemed the holder of share capital of the Company for any purpose, nor shall anything contained in this Warrant Agreement be construed to confer upon a Holder, solely in its capacity as the registered holder of Warrants, any of the rights of a shareholder of the Company or any right to vote, give or withhold consent to any corporate action (whether any reorganization, issue of shares, reclassification of share capital, consolidation, merger, conveyance or otherwise), receive notice of meetings, receive dividends or subscription rights or rights to participate in new issues of shares, or otherwise, prior to the issuance to the Holder of the Warrant ADSs which it is then entitled to receive upon the valid exercise of Warrants.
6.2. Ability to issue cleansing notice. The Company shall at all times use its best efforts to conduct its activities such that it is able to issue a notice in accordance with section 708A(5)(e) of the Corporations Act in respect of the issue of any Ordinary Shares on the exercise of Warrants.
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6.3. ASX Filings. The Company will use its best efforts ensure that it applies to ASX for official quotation (as that expression is used in the ASX Listing Rules) of the Ordinary Shares issued on the exercise of the Warrants in the same class and on the same terms as all other Ordinary Shares quoted on ASX pursuant to ASX Listing Rule 2.7 immediately on issue of those Ordinary Shares.
6.4. Issue of Cleansing Notice. On the issue of any Ordinary Shares on the exercise of any Warrants, the Company shall use best efforts to ensure that it lodges with ASX a notice in accordance with section 708A(5)(e) of the Corporations Act in respect of that issue of Ordinary Shares within 5 business days of that issue, provided that if it is unable to comply with the requirements of section 708A(5)(e) of the Corporations Act in respect of an issue of Ordinary Shares issued on exercise of Warrants, the Company shall, at its own expense, do everything necessary to ensure that such Ordinary Shares are able to be freely traded on ASX in compliance with the ASX Listing Rules and the Corporations Act, including obtaining an exemption from the Australian Securities and Investments Commission (“ASIC”) or the lodging of a disclosure document with ASIC in accordance with the requirements of Chapter 6D of the Corporations Act.
6.5. Compensation for Buy-In on Failure to Timely Deliver Warrant ADSs Upon Exercise. In addition to any other rights available to the Holder, if the Company fails to cause the Depositary to deliver the Warrant ADSs to the Holder pursuant to Section 3.3.2 on or before the Delivery Time, and if after such date the beneficial owner is required by its broker to purchase (in an open market transaction or otherwise) or the beneficial owner’s brokerage firm otherwise purchases, ADSs or Ordinary Shares to deliver in satisfaction of a sale by the beneficial owner of the Warrant ADSs, which the beneficial owner anticipated receiving upon such exercise (a “Buy-In”), then the Company shall (A) pay in cash to the Holder the amount, if any, by which (x) the beneficial owner’s total purchase price (including brokerage commissions, if any) for the Warrant ADSs or Warrant Shares so purchased exceeds (y) the amount obtained by multiplying (1) the number of Warrant ADSs or Warrant Shares, as applicable, that the Company was required to deliver to the Holder in connection with the exercise at issue times (2) the price at which the sell order giving rise to such purchase obligation was executed, and (B) reinstate the portion of the Warrant and equivalent number of Warrant ADSs or Warrant Shares, as applicable, for which such exercise was not honored (in which case such exercise shall be deemed rescinded). For example, if the beneficial owner purchases Ordinary Shares having a total purchase price of $11,000 to cover a Buy-In with respect to an attempted exercise of Warrant ADSs with an aggregate sale price giving rise to such purchase obligation of $10,000, under clause (A) of the immediately preceding sentence, the Company shall be required to pay the Holder $1,000 for the benefit of the beneficial owner. The Holder shall provide the Company written notice indicating the amounts payable to the Holder in respect of the Buy-In and, upon request of the Company, evidence of the amount of such loss. Nothing herein shall limit right of a Holder to pursue any other remedies available to it hereunder, at law or in equity including, without limitation, a decree of specific performance and/or injunctive relief with respect to the Company’s failure to timely deliver Warrant ADSs upon exercise of the Warrant as required pursuant to the terms hereof. Notwithstanding anything to the contrary herein, the Warrant Agent shall not be liable for the Company’s failure to timely deliver the Warrant ADSs pursuant to the terms of the Warrants, nor shall the Warrant Agent be liable for any liquidated damages or any other damages associated therewith.
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6.6. Opinion of Counsel. On or prior to the date hereof, the Company shall provide an opinion of counsel reasonably satisfactory to the Warrant Agent prior to the effective date of this Agreement, which shall state that all Warrants or Warrant ADSs issuable upon exercise of the Warrants, as applicable: (i) were offered, sold or issued as part of an offering that was registered in compliance with the Securities Act; (ii) upon the issuance and sale of the Warrant against payment therefor, the Warrants will constitute the valid and binding obligations of the Company, enforceable against the Company in accordance with their terms and (iii) upon (A) exercise of a Warrant in accordance with its terms, (B) payment of the Exercise Price for the exercised Warrant and any applicable taxes and charges due in connection with such exercise, (C) issuance and deposit of the exercised shares with the Depositary or a custodian for the Depositary and issuance of the ADSs representing the exercised shares in accordance with the terms of the Deposit Agreement, and (D) due execution and delivery by the Depositary of the ADRs evidencing such ADSs, the ADSs representing the exercised shares will be validly issued and will entitle the registered holders thereof to the rights specified in the Deposit Agreement and the ADRs evidencing such ADS. Such opinion may be in the form of a reliance letter delivered to any underwriter of the Warrants.
7. Concerning the Warrant Agent. The Warrant Agent accepts its obligations herein set forth upon the express terms and conditions hereof, including the following to all of which the Company agrees and to all of which the rights hereunder of the Holders from time to time of the Warrants shall be subject:
7.1. Limitation of Liability. The Company covenants and agrees to indemnify and to hold the Warrant Agent harmless against any loss, liability, damage, judgment, fine, penalty, claim, demand, settlement, cost or expense (including the reasonable fees and expenses of legal counsel) which may be paid, incurred or suffered by or to which it may become subject, arising from or out of, directly or indirectly, any claims or liability resulting from any action taken, suffered or omitted by the Warrant Agent in connection with the execution, acceptance, administration, exercise and performance of its duties under this Warrant Agreement, including the reasonable costs and expenses of defending against any claim of liability arising therefrom, directly or indirectly, or of enforcing its rights under this Warrant Agreement; provided, that such covenant and agreement does not extend to, and the Warrant Agent shall not be indemnified with respect to, such costs, expenses, losses and damages incurred or suffered by the Warrant Agent as a result of, or arising out of, its gross negligence, bad faith, or willful misconduct (which gross negligence, bad faith, or willful misconduct must be determined by a final, non-appealable judgment of a court of competent jurisdiction). Notwithstanding anything contained herein to the contrary, the Warrant Agent’s aggregate liability during any term of this Warrant Agreement with respect to, arising from, or arising in connection with this Warrant Agreement, or from all Services provided or omitted to be provided under this Warrant Agreement, whether in contract, or in tort, or otherwise, is limited to, and shall not exceed, the amounts paid hereunder by the Company to Warrant Agent as fees and charges, but not including reimbursable expenses, during the twelve (12) months immediately preceding the event for which recovery from Warrant Agent is being sought. Notwithstanding anything in this Warrant Agreement to the contrary, in no event will the Warrant Agent be liable for special, punitive, indirect, incidental or consequential loss or damage of any kind whatsoever (including but not limited to lost profits), even if the Warrant Agent has been advised of the likelihood of such loss or damage and regardless of the form of action. The Warrant Agent will not be deemed to have knowledge of any event of which it was supposed to receive notice thereof hereunder, and the Warrant Agent will be fully protected and will incur no liability for failing to take any action in connection therewith unless and until it has received such notice.
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7.2. Reliance on Company Statement. Whenever in the performance of its duties under this Warrant Agreement, the Warrant Agent shall deem it necessary or desirable that any fact or matter be proved or established by the Company prior to taking, suffering or omitting to take any action hereunder, such fact or matter (unless other evidence in respect thereof be herein specifically prescribed) may be deemed to be conclusively proved and established by a statement signed by the Chief Executive Officer or Chairman of the Board of the Company and delivered to the Warrant Agent; and such certificate shall be full authorization and protection to the Warrant Agent and the Warrant Agent shall incur no liability for or in respect of any action taken, suffered or omitted to be taken by it under the provisions of this Warrant Agreement in reliance upon such certificate. The Warrant Agent shall not be held to have notice of any change of authority of any authorized officer, until receipt of written notice thereof from Company.
7.3. Remuneration. The Company agrees to pay the Warrant Agent reasonable remuneration for its services as such Warrant Agent hereunder in accordance with a fee schedule to be mutually agreed upon and will reimburse the Warrant Agent upon demand for all of its reasonable and documented expenses (including reasonable and documented counsel fees and expenses) incurred in connection with the preparation, delivery, negotiation, amendment, administration and execution of this Warrant Agreement and the exercise and performance of its duties hereunder. All amounts owed to the Warrant Agent under this Warrant Agreement are due within 30 days of the invoice date. The Company agrees to reimburse the Warrant Agent for any attorney’s fees and any other costs associated with collecting delinquent payments.
7.4. Agent for the Company. The Warrant Agent hereby accepts the agency established by this Warrant Agreement and agrees to perform the same upon the express terms and conditions (and no implied terms and conditions) herein set forth and among other things, shall account promptly to the Company with respect to Warrants exercised and concurrently account for all monies received by the Warrant Agent for the purchase of Shares through the exercise of Warrants. The Warrant Agent shall act hereunder solely as agent for the Company. The Warrant Agent shall not assume any obligations or relationship of agency or trust with any of the owners or holders of the Warrants or Shares. The Warrant Agent shall not have any duty or responsibility in the case of the receipt of any written demand from any holder of Warrants or Shares with respect to any action or default by the Company, including, without limiting the generality of the foregoing, any duty or responsibility to initiate or attempt to initiate any proceedings at law or otherwise or to make any demand upon the Company. The Warrant Agent shall have no responsibility to the Company, any holders of Warrants, any holders of Shares or any other person for interest or earnings on any moneys held by the Warrant Agent pursuant to this Warrant Agreement.
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7.5. Counsel. The Warrant Agent may consult with legal counsel reasonably acceptable to the Company (who may be legal counsel for the Company), and the opinion of such counsel shall be full and complete authorization and protection to the Warrant Agent as to any action taken, suffered or omitted to be taken by it in the absence of bad faith and in accordance with such opinion.
7.6. Documents. From time to time, Company may provide Warrant Agent with instructions concerning the services performed by the Warrant Agent hereunder. In addition, at any time Warrant Agent may apply to any officer of Company for instruction, with respect to any matter arising in connection with the services to be performed by the Warrant Agent under this Warrant Agreement. The Warrant Agent and its agents and subcontractors shall be protected and shall incur no liability for or in respect of any action taken or omitted by it in reliance upon any Warrant Certificate, notice, direction, consent, certificate, affidavit, statement or other paper or document reasonably believed by it to be genuine and to have been presented or signed by the proper parties. The Warrant Agent shall not be held to have notice of any change of authority of any Person, until receipt of written notice thereof from Company.
7.7. Certain Transactions. The Warrant Agent, and its officers, directors and employees, may become the owner of, or acquire any interest in, the Warrants, with the same rights that it or they would have if it were not the Warrant Agent hereunder, and, to the extent permitted by applicable law, it or they may engage or be interested in any financial or other transaction with the Company and may act on, or as depositary, trustee or agent for, any committee or body of Holders or other obligations of the Company as freely as if it were not the Warrant Agent hereunder. Nothing in this Warrant Agreement shall be deemed to prevent the Warrant Agent from acting in any other capacity for the Company or for any other legal entity.
7.8. No Liability for Interest. Unless otherwise agreed with the Company, the Warrant Agent shall have no liability for interest on any monies at any time received by it pursuant to any of the provisions of this Warrant Agreement or of the Warrant Certificates.
7.9. No Liability for Invalidity. The Warrant Agent shall have no liability with respect to any invalidity of this Warrant Agreement (except as to the Warrant Agent’s countersignature thereon) or any of the Warrant Certificates.
7.10. No Responsibility for Representations. The Warrant Agent shall not be responsible for any of the recitals or representations herein or in the Warrant Certificates, all of which are made solely by the Company.
7.11. No Implied Obligations. The Warrant Agent shall be obligated to perform only such duties as are herein and in the Warrants specifically set forth and no implied duties or obligations shall be read into this Warrant Agreement or the Warrants against the Warrant Agent. The Warrant Agent shall not be under any obligation to take any action hereunder which may tend to involve it in any expense or liability, the payment of which within a reasonable time is not, in its reasonable opinion, assured to it. The Warrant Agent shall not be accountable or under any duty or responsibility for the use by the Company of any of the Pre-funded Warrants authenticated by the Warrant Agent and delivered by it to the Company pursuant to this Warrant Agreement or for the application by the Company of the proceeds of the Warrants. The Warrant Agent shall have no duty or responsibility in case of any default by the Company in the performance of its covenants or agreements contained herein or in the Warrants or in the case of the receipt of any written demand from a Holder of a Warrant Certificate with respect to such default, including, without limiting the generality of the foregoing, any duty or responsibility to initiate or attempt to initiate any proceedings at law.
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7.12. Medallion Guarantee. The Warrant Agent may rely on and be fully authorized and protected in acting or failing to act upon (a) any guaranty of signature by an “eligible guarantor institution” that is a member or participant in the Securities Transfer Agents Medallion Program or other comparable “signature guarantee program” or insurance program in addition to, or in substitution for, the foregoing; or (b) any law, act, regulation or any interpretation of the same even though such law, act, or regulation may thereafter have been altered, changed, amended or repealed.
7.13. No Risk of Own Funds. No provision of this Warrant Agreement shall require the Warrant Agent to expend or risk its own funds or otherwise incur any financial liability in the performance of any of its duties hereunder or in the exercise any of its rights or powers if it shall reasonably believe that repayment of such funds or adequate indemnification against such risk or liability is not reasonably assured to it.
7.14. Duties of Warrant Agent. The Warrant Agent undertakes the duties and obligations imposed by this Warrant Agreement upon the following express terms and conditions (and no implied duties or obligations shall be read into this Warrant Agreement against the Warrant Agent), by all of which the Company, by its acceptance hereof, shall be bound:
7.14.1. Whenever in the performance of its duties under this Warrant Agreement the Warrant Agent shall deem it necessary or desirable that any fact or matter be proved or established by the Company prior to taking, suffering or omitting to take any action hereunder, such fact or matter (unless other evidence in respect thereof be herein specifically prescribed) may be deemed to be conclusively proved and established by a certificate signed by the Chief Executive Officer, Chief Legal Officer or Chief Financial Officer of the Company; and such certificate shall be full authentication to the Warrant Agent for any action taken, suffered or omitted to be taken in the absence of bad faith by it under the provisions of this Warrant Agreement in reliance upon such certificate.
7.14.2. Subject to the limitation set forth in Section 7.1, the Warrant Agent shall be liable hereunder only for its own gross negligence, bad faith or willful misconduct (each as determined by a by a final, non-appealable judgment of a court of competent jurisdiction). Notwithstanding anything to the contrary herein, the Warrant Agent shall not be liable for the Company’s failure to timely deliver Warrant ADSs or Warrant Shares pursuant to the terms of the Warrants, nor shall the Warrant Agent be liable for any liquidated damages or any other damages associated therewith.
7.14.3. The Warrant Agent shall not be liable for or by reason of any of the statements of fact or recitals contained in this Warrant Agreement or in the Warrants (except its countersignature thereof) by the Company or be required to verify the same, but all such statements and recitals are and shall be deemed to have been made by the Company only.
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7.14.4. The Warrant Agent shall not be under any responsibility in respect of the validity of this Warrant Agreement or the execution and delivery hereof (except the due execution hereof by the Warrant Agent) or in respect of the validity or execution of any Warrant; nor shall it be responsible for any breach by the Company of any covenant or condition contained in this Warrant Agreement or in any Warrant; nor shall it be responsible for the adjustment of the Exercise Price or the making of any change in the number of Warrant ADSs or Warrant Shares required under the provisions of Section 3 or 4 hereof or responsible for the manner, method or amount of any such change or the ascertaining of the existence of facts that would require any such adjustment or change (except with respect to the exercise of the Warrants evidenced by Warrant Certificates after actual notice of any adjustment of the Exercise Price); nor shall it by any act hereunder be deemed to make any representation or warranty as to the authorization or reservation of any Warrant ADSs or Warrant Shares to be issued pursuant to this Warrant Agreement or any Warrant or as to whether any Warrant ADSs or Warrant Shares will, when issued, be duly authorized, validly issued, fully paid and nonassessable.
7.14.5. The Warrant Agent may execute and exercise any of the rights or powers hereby vested in it or perform any duty hereunder either itself or by or through its attorneys or agents, and the Warrant Agent shall not be answerable or accountable for any act, omission, default, neglect or misconduct of any such attorneys or agents or for any loss to the Company resulting from any such act, omission, default, neglect or misconduct, absent fraud, gross negligence, willful misconduct or bad faith (each as determined by a final, non-appealable judgment of a court of competent jurisdiction) in the selection and continued employment thereof.
7.15. Payment of Taxes. The Company will from time to time promptly pay all taxes and charges that may be imposed upon the Company or the Warrant Agent in respect of the issuance or delivery of Warrant Shares or Warrant ADSs upon the exercise of Warrants.
7.16. Termination. Unless terminated earlier by the parties hereto, this Warrant Agreement shall terminate 90 days after the earlier of the Expiration Date and the date on which no Warrants remain outstanding (the “Termination Date”). On the business day following the Termination Date, the Warrant Agent shall deliver to the Company any entitlements, if any, held by the Warrant Agent under this Warrant Agreement. The provisions of this Section 7 shall survive the termination of this Warrant Agreement, the resignation, replacement or removal of the Warrant Agent and the exercise, termination and expiration of the Warrants.
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8. Resignation of Warrant Agent.
8.1. Appointment of Successor Warrant Agent. The Warrant Agent, or any successor to it hereafter appointed, may resign its duties and be discharged from all further duties and liabilities hereunder after giving thirty (30) days’ notice in writing to the Company, or such shorter period of time agreed to by the Company. If the office of the Warrant Agent becomes vacant by resignation or incapacity to act or otherwise, the Company shall appoint in writing a successor Warrant Agent in place of the Warrant Agent. If the Company shall fail to make such appointment within a period of 60 days after it has been notified in writing of such resignation or incapacity by the Warrant Agent, then any Holder may apply to any court of competent jurisdiction for the appointment of a successor Warrant Agent at the Company’s cost. Pending appointment of a successor to such Warrant Agent, either by the Company or by such a court, the duties of the Warrant Agent shall be carried out by the Company. Any successor Warrant Agent (but not including the initial Warrant Agent), whether appointed by the Company or by such court, shall be a person organized and existing under the laws of any state or of the United States of America, in good standing, and authorized under such laws to exercise shareowner services powers and subject to supervision or examination by federal or state authority. After appointment, any successor Warrant Agent shall be vested with all the authority, powers, rights, immunities, duties, and obligations of its predecessor Warrant Agent with like effect as if originally named as Warrant Agent hereunder, without any further act or deed, and except for executing and delivering documents as provided in the sentence that follows, the predecessor Warrant Agent shall have no further duties, obligations, responsibilities or liabilities hereunder, but shall be entitled to all rights that survive the termination of this Warrant Agreement and the resignation or removal of the Warrant Agent, including but not limited to its right to indemnity hereunder. If for any reason it becomes necessary or appropriate, the predecessor Warrant Agent shall execute and deliver, at the expense of the Company, an instrument transferring to such successor Warrant Agent all the authority, powers, and rights of such predecessor Warrant Agent hereunder; and upon request of any successor Warrant Agent the Company shall make, execute, acknowledge, and deliver any and all instruments in writing for more fully and effectually vesting in and confirming to such successor Warrant Agent all such authority, powers, rights, immunities, duties, and obligations; provided that, such predecessor Warrant Agent shall not be required to make any additional expenditure (without prompt reimbursement by the Company) or assume any additional liability in connection with the foregoing.
8.2. Notice of Successor Warrant Agent. In the event a successor Warrant Agent shall be appointed, the Company shall give notice thereof to the predecessor Warrant Agent and the transfer agent for the ADSs not later than the effective date of any such appointment.
8.3. Merger or Consolidation of Warrant Agent. Any person into which the Warrant Agent may be merged or converted or with which it may be consolidated or any person resulting from any merger, conversion or consolidation to which the Warrant Agent shall be a party or any person succeeding to the shareowner services business of the Warrant Agent or any successor Warrant Agent shall be the successor Warrant Agent under this Warrant Agreement, without any further act or deed. For purposes of this Warrant Agreement, “person” shall mean any individual, firm, corporation, partnership, limited liability company, joint venture, association, trust or other entity, and shall include any successor (by merger or otherwise) thereof or thereto.
9. Miscellaneous Provisions.
9.1. Severability. This Warrant Agreement shall be deemed severable, and the invalidity or unenforceability of any term or provision hereof shall not affect the validity or enforceability of this Warrant Agreement or of any other term or provision hereof. Furthermore, in lieu of any such invalid or unenforceable term or provision, the parties hereto intend that there shall be added as a part of this Warrant Agreement a provision as similar in terms to such invalid or unenforceable provision as may be possible and be valid and enforceable. If an invalid or unenforceable provision shall affect the rights, immunities, liabilities, duties or obligations of the Warrant Agent, the Warrant Agent shall be entitled to resign immediately upon written notice to the Company.
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9.2. Company Representations and Warranties. The Company represents and warrants that:
9.2.1. it is duly incorporated, validly existing and in good standing under the laws of its jurisdiction of incorporation (to the extent that the concept of “good standing” or an equivalent concept exists in the laws of its jurisdiction);
9.2.2. the offer and sale of the Warrants and the execution, delivery and performance of all transactions contemplated thereby (including this Warrant Agreement) have been duly authorized by all necessary corporate action and will not result in a breach of or constitute a default under the constitution of the Company or any indenture, agreement or instrument to which it is a party or is bound;
9.2.3. this Warrant Agreement has been duly executed and delivered by the Company and constitutes the legal, valid, binding and enforceable obligation of the Company;
9.2.4. the Warrants will comply in all material respects with all applicable requirements of law; and
9.2.5. to the best of its knowledge, there is no litigation pending or threatened as of the date hereof in connection with the offering of the Warrants.
9.3. Entire Agreement. This Warrant Agreement, together with the Warrants, contains the entire agreement and understanding among the parties hereto with respect to the subject matter hereof, and supersedes all prior and contemporaneous agreements, understandings, inducements and conditions, express or implied, oral or written, of any nature whatsoever with respect to the subject matter hereof. In the event that any claim of inconsistency between this Warrant Agreement and the descriptions in the Registration Statement, as they may from time to time be amended, the terms of this Warrant Agreement shall control. The Company shall not amend any provisions of the Warrants without the prior consent of the Warrant Agent, not to be unreasonably withheld or delayed.
9.4. Authorized Representatives. Set forth in Annex B to this Warrant Agreement is a list of the names and specimen signatures of the persons authorized to act for the Company under this Warrant Agreement (the “Authorized Representatives”). The Company shall, from time to time, certify to you the names and signatures of any other persons authorized to act for the Company under this Warrant Agreement.
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9.5. Notices. Any notice, statement or demand authorized by this Warrant Agreement to be given or made by the Warrant Agent or by the holder of any Warrant to or on the Company shall be sufficiently given when so delivered if by hand or overnight delivery or if sent by certified mail or private courier service upon deposit of such notice, postage prepaid, addressed (until another address is filed in writing by the Company with the Warrant Agent), as follows:
Chilwa Minerals Limited
Attention: Susan Park
Telephone: +61 8 9389 2111
Email: spark@parkadvisory.com.au
with a copy to:
Rimon Law
Attention: Andrew Reilly
Email: andrew.reilly@rimonlaw.com
Any notice, statement or demand authorized by this Warrant Agreement to be given or made by the holder of any Warrant or by the Company to or on the Warrant Agent shall be sufficiently given when so delivered if by hand or overnight delivery or if sent by certified mail or private courier service upon deposit of such notice, postage prepaid, addressed (until another address is filed in writing by the Warrant Agent with the Company), as follows:
Computershare Trust Company, N.A.
Computershare Inc.
150 Royal Street
Canton, MA 02021
Attn: Client Services
9.6. Governing Law. This Warrant Agreement shall be deemed to be a contract made under the laws of the State of New York and for all purposes shall be governed by and construed in accordance with the laws of the State of New York, without giving effect to any provision of law or rule (whether of the State of New York or any other jurisdictions) that would cause the application of the laws of any jurisdictions other than the State of New York. The Company hereby irrevocably submits to the exclusive jurisdiction of the state and federal courts sitting in The City of New York, Borough of Manhattan, for the adjudication of any dispute hereunder or in connection herewith or with any transaction contemplated hereby or discussed herein, and hereby irrevocably waives, and agrees not to assert in any suit, action or proceeding, any claim that it is not personally subject to the jurisdiction of any such court, that such suit, action or proceeding is brought in an inconvenient forum or that the venue of such suit, action or proceeding is improper. Each of the parties hereto hereby waives the right to a trial by jury in any action or proceeding arising out of or relating to this Warrant Agreement.
9.7. Successors and Assigns. This Warrant Agreement shall inure to the benefit of and be binding upon the successors and assigns of the parties hereto. This Warrant Agreement may not be assigned, or otherwise transferred, in whole or in part, by either party without the prior written consent of the other party, which the other party will not unreasonably withhold, condition or delay; except that (i) consent is not required for an assignment or delegation of duties by Warrant Agent to any affiliate of Warrant Agent and (ii) any reorganization, merger, consolidation, sale of assets or other form of business combination by Warrant Agent shall not be deemed to constitute an assignment of this Warrant Agreement.
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9.8. Amendments. This Warrant Agreement may be amended by the parties hereto without the consent of any Holder for the purpose of curing any ambiguity, or curing, correcting or supplementing any defective provision contained herein or adding or changing any other provisions with respect to matters or questions arising under this Warrant Agreement as the parties may deem necessary or desirable and that the Company deem shall not adversely affect the interest of the Holders. All other modifications or amendments shall require the vote or written consent of the beneficial owners of at least 65% of the then outstanding Warrants. Notwithstanding the foregoing, adjustments may be made to the Warrant terms and rights pursuant to Section 4 without the consent of the Holders. As a condition precedent to the Warrant Agent’s execution of any amendment, the Company shall deliver to the Warrant Agent a certificate from a duly authorized officer of the Company that states that the proposed amendment is in compliance with the terms of this Section 9.8. Notwithstanding anything in this Warrant Agreement to the contrary, the Warrant Agent may, but is not obligated to, execute any amendment, supplement or waiver that affects the Warrant Agent’s own rights, duties or immunities under this Warrant Agreement. No supplement or amendment to this Warrant Agreement shall be effective unless duly executed by the Warrant Agent.
9.9. Persons Having Rights under this Warrant Agreement. Nothing in this Warrant Agreement expressed and nothing that may be implied from any of the provisions hereof is intended, or shall be construed, to confer upon, or give to, any person or corporation other than the parties hereto and the Holders any right, remedy, or claim under or by reason of this Warrant Agreement or of any covenant, condition, stipulation, promise, or agreement hereof.
9.10. Examination of the Warrant Agreement. A copy of this Warrant Agreement shall be available at all reasonable times at the office of the Warrant Agent designated for such purpose for inspection by any Holder. Prior to such inspection, the Warrant Agent may require any such Holder to verify ownership of Warrants.
9.11. Counterparts. This Warrant Agreement may be executed in any number of original, facsimile or electronic counterparts and each of such counterparts shall for all purposes be deemed to be an original, and all such counterparts shall together constitute but one and the same instrument.
9.12. Effect of Headings. The Section headings herein are for convenience only and are not part of this Warrant Agreement and shall not affect the interpretation thereof.
9.13. Force Majeure. Notwithstanding anything to the contrary contained herein, the Warrant Agent will not be liable for any delays or failures in performance resulting from acts beyond its reasonable control including, without limitation, acts of God, epidemics, pandemics, terrorist acts, shortage of supply, breakdowns or malfunctions, interruptions or malfunction of computer facilities, or loss of data due to power failures or mechanical difficulties with information storage or retrieval systems, labor difficulties, war, or civil unrest.
9.14. Confidentiality. The Warrant Agent and the Company agree that all books, records, information and data pertaining to the business of the other party, including inter alia, personal, non-public warrant holder information, which are exchanged or received pursuant to the negotiation or the carrying out of this Warrant Agreement, including the fees for services set forth in a fee schedule to be mutually agreed upon, shall remain confidential, and shall not be voluntarily disclosed to any other person, except as may be required by law, including, without limitation, pursuant to subpoenas from state or federal government authorities (e.g., in divorce and criminal actions).
9.15. Further Assurances. The Company agrees to perform, execute, acknowledge, and deliver or cause to be performed, executed, acknowledged, and delivered all such further and other acts, instruments, and assurances as may reasonably be required by the Warrant Agent for the carrying out or performing of the provisions of this Warrant Agreement.
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IN WITNESS WHEREOF, this Warrant Agreement has been duly executed by the parties hereto as of the day and year first above written.
| CHILWA MINERALS LIMITED | ||
| By: | ||
| Name: | Cadell Buss | |
| Title: | Chief Executive Officer | |
| Name: | Susan Park | |
| Title: | Company Secretary | |
| Address for notices: | ||
| Level 28, 140 St Georges Terrace Perth WA 6000, Australia | ||
| Attention: Company Secretary | ||
| Telephone: +61 8 9389 2111 | ||
| E-mail: spark@parkadvisory.com.au | ||
COMPUTERSHARE INC. and COMPUTERSHARE TRUST COMPANY, N.A., as Warrant Agent | ||
| By: | ||
| Name: | ||
| Title: | ||
Annex A - Form of Global Certificate
Annex B - Authorized Representatives
ANNEX A
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION (“DTC”), TO ISSUER OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
CHILWA MINERALS LIMITED
WARRANT CERTIFICATE
NOT EXERCISABLE AFTER AUGUST [●], 2031
This certifies that the person whose name and address appears below, or registered assigns, is the registered owner of the number of Warrants set forth below. Each Warrant entitles its registered holder to purchase from CHILWA MINERALS Limited (the “Company”) at any time prior to 5:00 P.M. (New York City time) on August [●], 2031, at the designated office of Computershare Inc., a Delaware corporation (“Computershare”), and its Affiliate, Computershare Trust Company, N.A., a federally chartered trust company, collectively as Warrant Agent (the “Warrant Agent”) set forth below, one American depositary share (each, an “ADS”), each ADS representing 10 ordinary shares, no par value, of the Company (each, a “Share” and collectively, the “Shares”), at price of US$ , subject to possible adjustments as provided in the Warrant Agreement (as defined below). The Company shall pay the issuance fees of the Depositary for the issuance of new ADSs upon exercise of the Warrants.
This Global Certificate upon surrender at the designated office of the Warrant Agent, may be exchanged for another Global Certificate evidencing the same number of Warrants as the Global Certificate surrendered. A transfer of the Warrants evidenced hereby may be registered upon surrender of this Global Certificate at the designated office of the Warrant Agent by the registered holder in person or by a duly authorized attorney, properly endorsed or accompanied by proper instruments of transfer, a signature guarantee, and such other and further documentation as the Warrant Agent may reasonably request and duly stamped as may be required by the laws of the State of New York and of the United States of America.
The terms and conditions of the Warrants and the rights and obligations of the holder of this Global Certificate are set forth in an ADS Warrant Agreement dated as of August [●], 2026 (the “Warrant Agreement”) between the Company and the Warrant Agent. A copy of the Warrant Agreement is available for inspection during business hours at the office of the Warrant Agent.
This Global Certificate shall not be valid or obligatory for any purpose until it shall have been countersigned by an authorized signatory of the Warrant Agent.
WITNESS the facsimile signature of a proper officer of the Company.
| CHILWA MINERALS LIMITED | ||
| By: | ||
| Name: | Cadell Buss | |
| Title: | Chief Executive Officer | |
| By: | ||
| Name: | Susan Park | |
| Title: | Company Secretary |
| Dated: August [●], 2026 | ||
| Countersigned: | ||
COMPUTERSHARE INC. and COMPUTERSHARE TRUST COMPANY, N.A., as Warrant Agent |
||
| By: | ||
| Name: | ||
| Title: | ||
PLEASE DETACH HERE
Certificate No.: Number of Warrants:
WARRANT CUSIP NO.: 16934F 111
CHILWA MINERALS LIMITED
| [Name & Address of Holder] | COMPUTERSHARE INC. and COMPUTERSHARE TRUST COMPANY, Warrant Agent | |
| By mail: | ||
| [please insert] | ||
| By hand or overnight courier: | ||
| [please insert] | ||
ANNEX B
Authorized Representatives
| Name | Title | Signature | ||
| Cadell Buss | Chief Executive Officer | |||
| Mark Laybourn | Chief Financial Officer | |||
| Susan Park | Company Secretary |
Exhibit 5.1
August 20, 2026
Chilwa Minerals Limited
Level 28, 140 St George’s Terrace
Perth, WA 6005
Australia
| Re: | Registration Statement on Form F-1 |
Ladies and Gentlemen:
We have acted as Australian counsel to Chilwa Minerals Limited, an Australian corporation (the “Company”), in connection with its filing of a registration statement on Form F-1, No. 333-297336, and any amendment thereto (the “Registration Statement”), under the U.S. Securities Act of 1933, as amended (the “Securities Act”), with the U.S. Securities and Exchange Commission (the “Commission”).
The Registration Statement relates to the proposed offer and sale by the Company of up to 8,000,000 ordinary shares of the Company (the “Shares”) represented by 800,000 American Depositary Shares (the “ADSs”), warrants to purchase up to 800,000 ADSs (the “Warrants”) representing 8,000,000 Shares and 40,000 warrants offered to the Underwriter (the “Representative’s Warrants”) entitling the holder to purchase up to 5% of ADSs sold and representing 400,000 Shares (collectively, the “Securities”).
For the purposes of this opinion, we have examined and relied upon copies of the following documents:
| (a) | the Registration Statement; |
| (b) | the prospectus (“Prospectus”) contained in the Registration Statement; |
| (c) | the Company’s Constitution; |
| (d) | a draft of the ADS Warrant Agent Agreement pursuant to which the Warrants will be issued; |
| (e) | a draft of the Representative’s Warrants; and |
| (f) | a search obtained from the Australian Securities and Investments Commission as at August 19, 2026. |
We have also examined and relied upon a certificate, dated the date hereof, of the Company Secretary of the Company certifying the accuracy and completeness of the Constitution of the Company and resolutions of the Board of Directors of the Company dated July 25, 2026 and August 14, 2026. We have also examined such other documents and made such enquiries as to questions of law as we have deemed relevant and necessary in order to render the opinions set forth below.
In such examination, we have assumed (a) the genuineness of all signatures; (b) the authenticity of all documents submitted to us as originals; (c) the conformity to original documents of all documents submitted to us as copies (certified or otherwise); (d) the authenticity of the originals of such copies; (e) all information contained in all documents reviewed by us is true and correct; (f) that resolutions of the Board of Directors of the Company that we have relied upon for the purposes of this opinion have not been, and will not be, varied or revoked after the date of this opinion and that the meetings of the Board of Directors of the Company at which the resolutions were considered were properly convened, all Directors who attended and voted were entitled to do so, the resolutions were properly passed, and the Directors have performed their duties properly and all provisions relating to the declaration of Directors’ interests or the power of interested Directors were duly observed; (g) the accuracy of any searches obtained from the Australian Securities and Investments Commission in relation to the Company; (h) each natural person signing any document reviewed by us had the legal capacity to do so and to perform his or her obligations thereunder; and (i) each person signing in a representative capacity any document reviewed by us had authority to sign in such capacity.
Our opinion is subject to (i) the Registration Statement, and any amendments thereto (including all necessary post-effective amendments), becoming effective under the Securities Act (and on the assumption that it will remain effective at the time of issuance of any Securities thereunder); (ii) the Securities to be sold under the Registration Statement being duly authorized by the Board of Directors and the Company’s shareholders (to the extent required under the listing rules of the Australian Securities Exchange); (iii) the agreed upon consideration being received for the issue of the Securities; (iv) the issuance of the Warrants and the Representative’s Warrants being duly authorized by the Board of Directors and the Company’s shareholders (to the extent required under the listing rules of the Australian Securities Exchange); (v) a definitive purchase, underwriting or similar agreement with respect to any Securities will be duly authorized and validly executed and delivered by the Company and the other parties thereto; (vi) a definitive form of the Warrants will be duly authorized and validly executed and delivered by the Company; and (vii) the terms of the issuance and sale of the Securities and the issuance of the Warrants and Representative’s Warrants being in conformity with the Company’s Constitution, the Australian Corporations Act 2001 (the “Corporations Act”) and the listing rules of the Australian Securities Exchange, and in the manner stated in the Registration Statement, so as not to violate any applicable law or result in a default under or breach of any agreement or instrument binding upon the Company, and so as to comply with any requirement or restriction imposed by any court or governmental body having jurisdiction over the Company.
Based upon and subject to the foregoing, we are of the opinion that:
| (a) | the Company is duly incorporated and validly existing under the laws of the Commonwealth of Australia in good standing (as such term is not defined under the Corporations Act, meaning solely that there are no current orders for the winding up of, or appointment of a receiver or liquidator for the Company or any notice of its proposed deregistration); |
| (b) | the issuance of the Shares, the Warrants and the Representative’s Warrants has been duly authorized; |
| (c) | when issued and paid for as contemplated by Prospectus included in the Registration Statement, the Shares represented by ADSs will be legally issued, fully paid and non-assessable (for the purpose of this opinion, the term “non-assessable”, when used to describe the liability of a person as the registered holder of ordinary shares has no clear meaning under the laws of the Commonwealth of Australia, so we have assumed those words to mean that holders of such ordinary shares, having fully paid all amounts due on such ordinary shares, are under no personal liability to contribute to the assets and liabilities of the Company in their capacities purely as holders of such ordinary shares); |
| (d) | the Warrants and the Representative’s Warrants have been approved by the Company’s Board of Directors and duly authorized, executed and delivered by the Company, and the Warrants and the Representative’s Warrants will be valid and binding obligations of the Company; and |
2
| (e) | upon the exercise of any Warrants and Representative’s Warrants and the Company receiving any additional consideration which is payable upon the exercise of the Warrants and Representative’s Warrants, the ordinary shares representing the ADSs issuable upon the exercise of the Warrants and the Representative’s Warrants will be legally issued, fully paid and non-assessable. |
The opinions expressed above are limited to the laws of the Commonwealth of Australia and we do not express any opinion as to the effect of any other laws, in particular as to whether an agreement or security which is governed by a law other than such laws is valid and binding. This opinion letter is limited to the matters stated herein; no opinion may be inferred beyond the matters expressly stated.
This opinion letter will be deemed to have been delivered as of the date of effectiveness of the Registration Statement and will speak as of such date.
We hereby consent to the use of our opinion as herein set forth as an exhibit to the Registration Statement and to the use of our name under the caption “Legal Matters” in the prospectus forming a part of the Registration Statement. In giving this consent, we do not hereby admit that we come within the category of persons whose consent is required under Section 7 of the Securities Act or the rules and regulations of the Commission promulgated thereunder.
Very truly yours,
| /s/ Rimôn Law Pty Ltd | |
| Rimôn Law Pty Ltd |
3
Exhibit 5.2
August 20, 2026
Chilwa Minerals Limited
Level 28, 140 St George’s Terrace
Perth, WA 6005
Australia
| Re: | Registration Statement on Form F-1 |
Ladies and Gentlemen:
We have acted as special United States counsel to Chilwa Minerals Limited, an Australian corporation (the “Company”), in connection with its filing of a registration statement on Form F-1, No. 333-297336, and any amendment thereto (the “Registration Statement”), under the U.S. Securities Act of 1933, as amended (the “Securities Act”), with the U.S. Securities and Exchange Commission (the “Commission”).
The Registration Statement relates to the proposed offer and sale by the Company of up to 8,000,000 ordinary shares of the Company (the “Shares”) represented by 800,000 American Depositary Shares (the “ADSs”), warrants to purchase up to 800,000 ADSs (the “Warrants”) representing 8,000,000 Shares and 40,000 warrants offered to the Underwriter (the “Representative’s Warrants”) entitling the holder to purchase up to 5% of ADSs sold (the “Warrant ADSs”).
We have reviewed the Registration Statement and the forms of the ADS Warrant Agent Agreement to be entered into between the Company and Computershare Inc. and its affiliate, Computershare Trust Company, N.A. as Warrant Agent (the “Warrant Agent”) relating to the issuance of the Warrants (the “Warrant Agent Agreement”) and the Representative’s Warrant. We have examined the originals, or photostatic or certified copies, of such records of the Company, of certificates of officers of the Company and of public documents, and such other documents as we have deemed relevant and necessary as the basis of the opinions set forth below. In such examination, we have assumed the genuineness of all signatures, the authenticity of all documents submitted to us as originals, the conformity to original documents of all documents submitted to us as photostatic or certified copies and the authenticity of the originals of such copies.
We have assumed that (i) the Company has been duly incorporated and is validly existing and in good standing under the laws of its jurisdiction of incorporation (to the extent that concept of good standing or such equivalent concept exists under the laws of such jurisdiction), and (ii) all corporate proceedings taken by the Company in connection with the authorization, issuance and sale of the Shares, the ADSs, the Representative’s Warrant, the Warrants and the Warrant ADSs have been duly taken by the Company.
Based upon and subject to the foregoing, we are of the opinion that upon (i) the due execution and delivery of the Warrant Agent Agreement by the Company and the Warrant Agent, (ii) the due execution and delivery of the Representative’s Warrants by the Company and (ii) the issuance and sale of the Warrants and the Representative’s Warrants in the manner referred to in the Registration Statement, the Warrants and the Representative’s Warrants will constitute the valid and binding obligation of the Company, enforceable against the Company in accordance with their terms, except as may be limited by bankruptcy, insolvency, fraudulent conveyance, reorganization, liquidation, moratorium, and other similar laws affecting creditors’ rights generally and by general principles of equity (regardless of whether considered in a proceeding in equity or at law).
The opinions expressed above are limited to the laws of the State of New York and the federal laws of the United States of America.
This opinion letter is limited to the matters stated herein, and no opinion is implied or may be inferred beyond the matters expressly stated. We hereby consent to the use of our opinion as herein set forth as an exhibit to the Registration Statement and to the use of our name under the caption “Legal Matters” in the prospectus forming a part of the Registration Statement. In giving this consent, we do not hereby admit that we come within the category of persons whose consent is required under Section 7 of the Securities Act or the rules and regulations of the SEC promulgated thereunder or Item 509 of Regulation S-K.
Very truly yours,
| /s/ Rimôn Law Pty Ltd | |
| Rimôn Law Pty Ltd |
Exhibit 23.1
CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
We hereby consent to the use in the Prospectus constituting a part of this Registration Statement of our report dated March 12, 2026, relating to the consolidated financial statements of Chilwa Minerals Limited (the Company), which is contained in that Prospectus. Our report contains an explanatory paragraph regarding the Company’s ability to continue as a going concern. We also consent to the reference to us under the caption “Experts” in the Prospectus.
/s/ BDO Audit Pty Ltd
Brisbane, Australia
August 20, 2026