Classic Minerals Limited announced a private placement of 1,100 unsecured convertible notes at a price of AUD 5,000 per note for gross proceeds of AUD 5,500,000 on December 15, 2022. The convertible notes will be convertible into ordinary shares of the company at any time up to 18 months after the issue of the notes, any note not converted by that date will be redeemed. The price at which notes convert to shares is the lesser of a 20% discount to the 15-day VWAP of shares as at the day prior to conversion; and AUD 0.017 on a post-consolidation basis.

No interest is payable on the notes, however, in lieu of interest the company will issue one free attaching conversion option for every two conversion shares issued. Each conversion option shall entitle the holder to acquire one share upon payment of the sum of AUD 0.025 per option. The conversion options will expire on December 1, 2025.

The transaction is expected to close on January 25, 2023. As part of the transaction, Still Capital Pty Ltd will receive sign on fees AUD 100,000 to cover shareholder management, documentation drafting and associated development costs and expenses to be paid post-completion of the issue of Convertible Notes, and 6% plus GST as capital raising fees and 30,000,000 options exercisable at AUD 0.025 on or before 1 December 2025. The issue of notes and advisor securities is conditional on shareholder approval being obtained at a general meeting of the company to be convened in mid-January 2023.

The transaction has been approved by the board of directors of the company.