Announcement PDF PROSPECTUS CELSIUS RESOURCES LIMITED (ACN 009 162 949) This Prospectus is being issued for an offer of 1,000 Shares at an issue price of £0.004 each (Offer). IMPORTANT NOTICE This is an important document and requires your immediate attention. It should be read in its entirety. If you are in doubt about what to do, you should consult your professional adviser without delay. An investment in the Shares offered in connection with this Prospectus should be considered of a speculative nature. Table of Contents Important information 5 Corporate directory 7 Indicative timetable 8 Key details of the Offer 9 Capital structure 9 Investment overview 10 1. Background to the Offer 15 2. Effect of the Offer 20 3. Risk factors 22 4. Rights attaching to Shares 29 5. Additional information 31 6. Directors’ statement and consent 37 7. Definitions 38 Prospectus (Celsius Resources Limited) Page 4 Important information General This Prospectus is issued by Celsius Resources Limited (ACN 009 162 949) (Company) for the purposes of Chapter 6D of the Corporations Act 2001 (Cth) (Corporations Act). This Prospectus is dated 16 December 2024 and was lodged with the ASIC on that date with the consent of all Directors. Neither ASIC nor ASX nor their respective officers take any responsibility for the contents of this Prospectus. No Shares will be issued on the basis of this Prospectus any later than 13 months after the date of this Prospectus (being the expiry date of this Prospectus). Application will be made to ASX no later than 7 days after the date of this Prospectus for official quotation of the Shares offered under the Offer. If permission is not granted by ASX for the official quotation of the Shares offered by this Prospectus within 3 months after the Prospectus Date (or such period as the ASX allows), the Company will repay, as soon as practicable, without interest, all Application Monies for Shares received pursuant to this Prospectus. The Shares offered by this Prospectus should be considered speculative. Please refer to Section 3 for details relating to investment risks. A copy of this Prospectus is available for inspection at the registered office of the Company at Level 5, 191 St Georges Terrace Perth WA 6000, during normal business hours. The Prospectus will also be made available in electronic form. Persons having received a copy of this Prospectus in its electronic form may obtain an additional paper copy of this Prospectus (free of charge) from the Company’s registered office by contacting the Company. The Offer contemplated by this Prospectus is only available in electronic form to persons receiving an electronic version of this Prospectus within Australia. Prospectus (Celsius Resources Limited) The Company will also provide copies of other documents on request free of charge (see Section 5.3). This Prospectus is a “transaction specific” prospectus for an offer of continuously quoted securities and has been prepared in accordance with section 713 of the Corporations Act. It does not contain the same level of disclosure as an initial public offering prospectus and is only required to contain, amongst other things, information in relation to the effect of the issue of securities on a company and the rights attaching to the securities. It is not necessary to include general information in relation to all of the assets and liabilities, financial position, profits and losses or prospects of the issuing company. No person is authorised to give any information or to make any representation in connection with the Offer in this Prospectus. Any information or representation not so contained may not be relied on as having been authorised by the Company or the Directors in connection with the Offer. No investment advice The information in this Prospectus is not financial product advice and does not take into account your investment objectives, financial situation or particular needs. It is important that you read this Prospectus in its entirety and seek professional advice where necessary. This document is important and should be read in its entirety before deciding to participate in the Offer. Before making any investment in the Company, each Applicant should consider whether such an investment is appropriate to his/her particular needs, and considering their individual risk profile for speculative investments, investment objectives and individual financial circumstances. Each Applicant should consult his/her stockbroker, solicitor, accountant or other professional adviser without delay. Page 5 Disclosing entity As a disclosing entity, the Company has issued this Prospectus in accordance with section 713 of the Corporations Act applicable to prospectuses for an offer to acquire securities which are quoted enhanced disclosure securities and the securities are in a class of securities that were quoted enhanced disclosure securities at all times in the 3 months before the issue of this Prospectus. This Prospectus is intended to be read in conjunction with the publicly available information in relation to the Company which has been notified to the ASX and does not include all the information that would be included in a prospectus for an initial public offering of securities in an entity that is not already listed on a stock exchange. Investors should therefore have regard to the other publicly available information in relation to the Company before making a decision about whether to invest. Having taken such precautions and having made such enquiries as are reasonable, the Company believes that it has complied with the requirements of the ASX as applicable to disclosing entities from time to time, and which require the Company to notify ASIC of information available to the stock market conducted by the ASX, throughout the 3 months before the issue of this Prospectus. Information that is already in the public domain has not been reported in this Prospectus other than that which is considered necessary to make this Prospectus complete. Overseas Shareholders The Offer constituted by this Prospectus in electronic form is only available to persons receiving an electronic version of this Prospectus and accompanying Application Form within Australia. No action has been taken to permit the offer of Shares under this Prospectus in any jurisdiction other than Australia. restricted by law and persons who come into possession of this Prospectus outside of Australia should observe any such restrictions. Any failure to comply with such restrictions may constitute a violation of applicable securities laws. This Prospectus does not constitute an offer of securities in any jurisdiction where, or to any person to whom, it would be unlawful to issue this Prospectus. Forward-looking statements This Prospectus includes forward-looking statements that have been based on current expectations about future acts, events and circumstances. These forward-looking statements are, however, subject to risks, uncertainties and assumptions that could cause those acts, events and circumstances to differ materially from the expectations described in the forward-looking statements. The Directors cannot and do not give any assurance that the results, performance or achievements expressed or implied by the forward-looking statements contained in this Prospectus will actually occur and investors are cautioned not to place undue reliance on these forward-looking statements. The Directors have no intention to update or revise forward-looking statements, or to publish prospective financial information in the future, regardless of whether new information, future events or any other factors affect the information contained in this Prospectus, except where required by law. Definitions, time and currency Definitions of certain terms used in this Prospectus are contained in Section 7. All references to currency are to Australian dollars and all references to time are to the time in Perth, Western Australia, unless otherwise indicated. Expenditures disclosed in this Prospectus are recognised exclusive of the amount of goods and services tax, unless otherwise disclosed. The distribution of this Prospectus in jurisdictions outside of Australia may be Prospectus (Celsius Resources Limited) Page 6 Corporate directory Directors Julito Sarmiento Executive Chairman Mark van Kerkwijk Executive Director Peter Hume Non-Executive Director Paul Dudley Non-Executive Director Attilenore Manero Non-Executive Director Company Secretary Kellie Davis Registered Office Share Registry* Level 5, 191 St Georges Terrace Automic Registry Services Perth WA 6000 Level 5, 191 St Georges Terrace Perth WA 6000 Telephone: +61 2 8072 1400 Email: info@celsiusresources.com.au Website: https://celsiusresources.com/ Telephone: +61 8 9324 2099 Solicitors Hamilton Locke Level 39, 152-158 St Georges Terrace Perth WA 6000 ASX Code: CLA * This entity is included for information purposes only. They have not been involved in the preparation of this Prospectus. Prospectus (Celsius Resources Limited) Page 7 Indicative timetable Event Lodgement of Prospectus with ASIC and ASX Date 16 December 2024 Opening Date of Offer Issue of Placement Securities Lodgement of Appendix 2A and Appendix 3G in relation to the Placement Securities Anticipated lodgment of Appendix 3B for Silvercorp Securities (if applicable) 18 December 2024 Anticipated issue of Silvercorp Securities and lodgement of Appendix 2A and Appendix 3G in relation to the Silvercorp Securities (if applicable) 23 December 2024 Issue of Shares under the Offer and lodgement of Appendix 2A Closing Date of Offer (5:00pm (AWST)) Note: The above dates are indicative only and may change without notice. The Company reserves the right to vary any and all of the above dates without notice, subject to the Corporations Act, Listing Rules and other applicable laws. In particular, the Company reserves the right to vary the Opening Date and the Closing Date without prior notice, which may have a consequential effect on the other dates. Applicants are therefore encouraged to lodge their Application Form as soon as possible after the Opening Date if they wish to invest in the Company. The Company also reserves the right not to proceed with the Offer at any time before the issue of the Shares offered by this Prospectus. Prospectus (Celsius Resources Limited) Page 8 Key details of the Offer Aspect Offer details Size A maximum of 1,000 Shares Issue price £0.004 Eligibility to participate The Offer is being extended to investors who are invited by the Company and is not open to the general public. Capital structure Indicative capital structure Securities on issue at Prospectus Date1 Shares 2,658,524,501 Warrants 261,444,414 Options 33,673,355 Securities on issue on completion of the Offer2,3 Shares 2,669,239,452 Warrants 266,801,390 Options 33,673,355 Notes: 1. Assumes the issue of the Placement Securities. 2. Assumes the Offer is fully subscribed, and no further Securities are issued. 3. Assumes Silvercorp subscribes for and is issued 10,713,951 Shares and 5,356,976 Warrants pursuant to its Participation Right. Refer to Sections 1.2 and 2 for further information regarding Silvercorp’s Participation Right and the effects on the Company’s capital structure. Prospectus (Celsius Resources Limited) Page 9 Investment overview This Section is intended to highlight key information for potential investors. It is an overview only and is not intended to replace the Prospectus. Potential investors should read the Prospectus in full before deciding to invest in the Shares offered by this Prospectus. Key information Further information Transaction specific prospectus - This Prospectus is a transaction specific prospectus for an offer to acquire continuously quoted securities (as defined in the Corporations Act) and has been prepared in accordance with section 713 of the Corporations Act. It does not contain the same level of disclosure as an initial public offering prospectus. In making representations in this Prospectus regard has been had to the fact that the Company is a disclosing entity for the purposes of the Corporations Act and certain matters may reasonably be expected to be known to investors and professional advisers whom potential investors may consult. What is the Offer being made under this Prospectus? Section 1.3 This Prospectus is being issued for an offer of 1,000 Shares at an issue price of £0.004 each (Offer). What is the purpose of this Prospectus? Section 1.4 The purpose of this Prospectus is to comply with section 708A(11) of the Corporations Act to remove any trading restrictions that attach to Shares issued by the Company prior to the Closing Date, so that subscribers of those Shares may, if they choose to, sell those Shares (as applicable) within twelve months from the date of their issue without the issue of a prospectus. What is the intended use of funds from the Offer? Section 2.4 After paying the expenses of the Offer of approximately A$10,706 there will be no proceeds from the Offer. The expenses of the Offer (exceeding any amounts raised under the Offer, which is a maximum of £4.00) will be met from the Company's existing cash reserves. The Offer is expected to have a nominal effect on the Company's financial position. What is the effect of the Offer? Section 2 Capital structure The effect of the Offer on the capital structure is set out below: Indicative capital structure Securities on issue at Prospectus Date Shares 2,658,524,501 Warrants 261,444,414 Prospectus (Celsius Resources Limited) Page 10 33,673,355 Options Securities on issue on completion of the Offer Shares 2,669,239,452 Warrants 266,801,390 Options 33,673,355 Control of the Company The Company is of the view that the Offer will not affect the control (as defined by section 50AA of the Corporations Act) of the Company. No investor or existing Shareholder will have a voting power greater than 20% as a result of the completion of the Offer. Substantial Shareholders Based on available information as at the Prospectus Date and to the extent known by the Company, those persons which together with their associates have a voting power in 5% or more of the Shares on issue are set out below: Substantial Shareholder Silvercorp Metals Inc. Shares Voting Power 280,467,602 10.55% In addition to the above, Silvercorp has the right, but not the obligation, to subscribe for up to a maximum of 10,713,951 Shares and 5,356,976 Warrants on the same terms as the Placement pursuant to its Participation Right (Silvercorp Securities). As at the Prospectus Date, Silvercorp has indicated that it intends to exercise its Participation Right in respect to the Placement, however no binding agreement has been executed. If any subscription agreement is entered into in relation to the Silvercorp Securities, the Company will update Shareholders in accordance with its continuous disclosure obligations. On completion of the Offer and assuming Silvercorp takes up the Silvercorp Securities in full, it is anticipated that Silvercorp will have a relevant interest in 291,181,553 Shares (representing a 10.91% voting power in the Company). Refer to Sections 1.2 and 2 for further information regarding Silvercorp’s Participation Right and the effects on the Company’s capital structure. Pro forma balance sheet As the Offer will not have a material impact on the Company’s financial position, a proforma statement of financial position of the Company showing the financial effect of the Offer has not been included in this Prospectus. Directors’ interests Section 5.8 The relevant interest of each of the Directors as at the Prospectus Date, is as follows: Director Shares Voting power Warrants Julito Sarmiento 4,000,000 0.15% - Prospectus (Celsius Resources Limited) Page 11 Mark van Kerkwijk 23,038,273 0.87% - Peter Hume 26,000,000 0.98% - Paul Dudley - - 10,000,000 21,000,000 0.79% - Attilenore Manero What are the risks of a further investment in the Company? Section 3 Potential investors should be aware that subscribing for Shares in the Company involves a number of risks. The key risk factors of which investors should be aware are set out in Section 3, including (but not limited to) risks in respect of: • Additional capital requirements: The Company currently does not have operating revenue, is unlikely to generate any operating revenue unless and until a project or projects are successfully developed and production commences. The future capital requirements of the Company will depend on many factors including its business development activities. In order to successfully develop its projects and for production to commence, the Company will likely require further financing in the future. Any additional equity financing may be dilutive to Shareholders and may be undertaken at potentially lower prices than the then market price or could involve restrictive covenants which limit the Company's operations and business strategy. Debt financing may involve restrictions on financing and operating activities which could further impact the Company’s operational flexibility. No assurances can be made that appropriate capital or funding, if and when needed, will be available on terms favourable to the Company or at all. In the absence of sufficient funding, the Company might face significant operational constraints, including potential delays in project timelines and the inability to meet contractual obligations. If the Company is unable to obtain additional financing as needed, it may be required to reduce the scope of its activities, and this could have a material adverse effect on the Company's activities including but not limited to resulting in the tenements being subject to forfeiture and could affect the Company's ability to continue as a going concern. The Company may undertake additional offerings of Securities in the future. The increase in the number of Shares issued and the possibility of sales of such Shares may have a depressive effect on the price of the Company’s Shares. In addition, as a result of such additional Shares, the voting power of the Company's existing Shareholders will be diluted. • Assets in the Philippines: The Company’s MCB Project, Sagay Project and Botilao Prospects are all located in the Philippines. Possible sovereign risks include, without limitation, changes in the terms of legislation that pertains to mining activities, changes to royalty arrangements, changes to taxation rates and concessions and changes in the ability to enforce legal rights. These risks may, in the future, adversely affect the financial performance of the Company and the market price of its Shares. No assurance can be given regarding future stability in the Philippines or any other country in which the Company may have, or seek to establish, project interests. Additionally, if a dispute arises regarding the Company’s project interests in the Philippines, the Company may not be able to rely on western legal standards. • MCB Project Mining Permit risk: As announced on 18 March 2024, the Company (via its wholly owned Philippine subsidiary, Makilala Mining Company, Inc. (MMCI)) obtained a Mineral Production Sharing Agreement (MPSA) with the Philippine Government for its flagship MCB Project. The MPSA has a term of 25 years and is renewable for another 25 years. The MPSA had an initial term of six Prospectus (Celsius Resources Limited) Page 12 (6) months from the date of grant. During this initial term, MMCI was required to submit the following: o Additional proof of financial capability to undertake the implementation of the pertinent approved Work Programs; and o Certification Pre-condition issued by the National Commission on Indigenous Peoples (NCIP). On 4 September 2024, the Company announced that MMCI completed the process of obtaining the Certificate Precondition (CP) as part of the Free, Prior and Informed Consent (FPIC) Process which is governed by the NCIP. As announced to ASX on 15 November 2022, MMCI signed an agreement with the Balatoc Tribe community setting out the terms and conditions for the use of their land for the purpose of mining. With the issuance of the CP, the only remaining requirement is to submit additional proof of financial capability to carry out the necessary work programs. The CP now allows management to finalise arrangements with interested Philippine and international investors for funding the MCB Project. On 14 November 2024, the Company announced that MMCI had been granted an additional six-month extension by the Philippine Government to comply with the financial capability requirement. Whilst the Directors presently have no reason to believe MMCI will not be able to satisfy the financial capability requirement within the six (6) month extension period, the Company cautions investors that there can be no guarantee that above requirements will be satisfied within the period. If MMCI is unable to satisfy the financial capability requirement this may have an adverse effect on the market price of the Company’s Shares. • Opuwo Cobalt Project: The Company’s Opuwo Cobalt Project is located in Namibia in Southern Africa. Namibia is considered to be a developing country and is subject to emerging and evolving legal and political systems. Possible sovereign risks include, without limitation, changes in the terms of mining legislation, changes to royalty arrangements, changes to taxation rates and concessions and changes in the ability to enforce legal rights. Any of these factors may, in the future, adversely affect the financial performance of the Company and the market price of its Shares. No assurance can be given regarding future stability in Namibia. Additionally, if a dispute arises regarding the Company’s project interests in Namibia, the Company may not be able to rely on western legal standards. As at the Prospectus Date, the Company has agreed the terms of a non-binding agreement with Stewardship Investments (Pty) Ltd concerning the disposal of the Company’s 95% interest in the Opuwo Project (refer to Section 5.4 for further information). The Company reiterates that no binding agreement has been reached and, although discussions are continuing, there can be no certainty that any binding agreement will be reached or the timing of any such agreement. The Company cautions investors that an investment decision should not be made based on any potential transaction. • Exploration and development risks: Mineral exploration and development can be a high-risk undertaking. There can be no assurance that exploration of the projects or any other exploration properties that may be acquired in the future will result in the discovery of an economic resource. Even if an apparently viable resource is identified, there is no guarantee that it can be economically developed and operated due to various factors including availability and cost of financing, adverse government policy, social acceptance, environmental Prospectus (Celsius Resources Limited) Page 13 constraints, accessibility to infrastructures, geological conditions, commodity prices or other technical difficulties. The future exploration activities of the Company may be affected by a range of factors including geological conditions, limitations on activities due to seasonal weather patterns, unanticipated operational and technical difficulties, industrial and environmental accidents, land acquisition process, changing government regulations and many other factors beyond the control of the Company. These challenges can result in delays, increased costs, or the inability to carry out exploration and development activities as planned. The success of the Company will also depend upon the Company having access to sufficient development capital, being able to maintain title to its projects and obtaining all required approvals for its activities. Failure to secure these elements may hinder project development and operational progress. In the event exploration programs are unsuccessful this could lead to a diminution in the value of its projects, a reduction in the cash reserves of the Company and possible relinquishment of part or all of its projects. Forward looking statements - This Prospectus contains forward-looking statements which are identified by words such as ‘may’, ‘could’, ‘believes’, ‘estimates’, ‘targets’, ‘expects’, or ‘intends’ and other similar words that involve risks and uncertainties. These statements are based on an assessment of present economic and operating conditions, and a number of assumptions regarding future events and actions that, at the date of this Prospectus, are considered reasonable. Such forward-looking statements are not guarantees of future performance and involve known and unknown risks, uncertainties, assumptions and other important factors, many of which are beyond the control of the Company, the Directors and management. Actual outcomes could differ materially from those anticipated in these statements due to these risks and uncertainties. The Directors cannot and do not give any assurance that the results, performance or achievements expressed or implied by the forward-looking statements contained in this Prospectus will actually occur and investors are cautioned not to place undue reliance on these forward-looking statements. The Directors have no intention to update or revise forward-looking statements, or to publish prospective financial information in the future, regardless of whether new information, future events or any other factors affect the information contained in this Prospectus, except where required by law. These forward-looking statements are subject to various risk factors that could cause the Company’s actual results to differ materially from the results expressed or anticipated in these statements. These risk factors are set out in Section 3. Prospectus (Celsius Resources Limited) Page 14 1. Background to the Offer 1.1 Background On 11 December 2024, the Company announced a placement to raise approximately £350,000 (before costs) by the issue of 87,500,000 Shares (Placement Shares) at £0.004 each and 43,750,000 freeattaching Warrants (Placement Warrants) (the Placement). The free-attaching Warrants were issued to Placement participants on the basis of one (1) free-attaching Warrant for every two (2) Placement Share subscribed for and issued under the Placement. The Placement Shares and Placement Warrants were issued to unrelated parties without prior Shareholder approval utilising the Company’s Listing Rule 7.1 placement capacity. 1.2 Silvercorp’s Participation Right In addition to the above, Silvercorp has the right, but not the obligation, to subscribe for up to a maximum of 10,713,951 Shares and 5,356,976 Warrants on the same terms as the Placement (Silvercorp Securities). As announced on 15 May 2023, the Company agreed to provide Silvercorp with a reasonable opportunity to participate in future equity offers in the Company on equivalent terms to other subscribers for a period of two years, provided Silvercorp’s relevant interest in the Company does not fall below 10% (Participation Right). As at the Prospectus Date, Silvercorp has indicated that it intends to exercise its Participation Right in respect to the Placement. There is no guarantee Silvercorp will take up the Silvercorp Securities in whole or in part, or at all. If any subscription agreement is entered into in relation to the Silvercorp Securities, the Company will update Shareholders in accordance with its continuous disclosure obligations. 1.3 The Offer The Company is offering, pursuant to this Prospectus 1,000 Shares at an issue price of £0.004 each to raise £4.00 (before costs). The Offer is being extended to investors who are invited by the Company and is not open to the general public. An Application Form for the Shares offered pursuant to the Offer will only be provided by the Company to these parties, together with a copy of this Prospectus. Shares issued under the Offer will rank equally with the Shares on issue at the Prospectus Date. Please refer to Section 4 for further information regarding the rights and liabilities attaching to the Shares. 1.4 Purpose of this Prospectus Section 707(3) of the Corporations Act generally requires that a prospectus is issued in order for a person to whom securities were issued without disclosure under Part 6D of the Corporations Act to onsell those securities within 12 months of the date of their issue. The Corporations Act provides an exception to section 707(3) where an entity issues a 'cleansing' notice under section 708A(5) within 5 days of the date of issue of the securities. Section 708A(11) of the Corporations Act provides another exemption from the general requirement under section 707(3) where: (a) the relevant securities are in a class of securities of the company that are already quoted on ASX; Prospectus (Celsius Resources Limited) Page 15 (b) (c) a prospectus is lodged with ASIC either: (i) on or after the day on which the relevant securities were issued but before the day on which the sale offer is made; or (ii) before the day on which the relevant securities are issued and offers of securities that have been made under the prospectus are still open for acceptance on the day on which the relevant securities were issued; the prospectus is for an offer of securities issued by the company that are in the same class of securities as the relevant securities. The Company requested a trading halt on ASX on 4 March 2024 to manage the Company’s continuous disclosure obligations pending the release of an announcement in relation to the issuance of the Mineral Production Sharing Agreement (MPSA) for the Maalinao-Caigutan-Biyog Copper-