Firefinch : Short Form Prospectus

Firefinch Limited ABN 11 113 931 105

Short Form Prospectus

For an offer to transfer Leo Lithium Shares to Firefinch Shareholders pursuant to a Capital Reduction by way of In-Specie Distribution being the subject of the Demerger Resolution in the Notice of Meeting dated 29 April 2022 and to facilitate secondary trading of those Leo Lithium Shares.

IMPORTANT INFORMATION

This Prospectus is important and requires your immediate attention. You should read this Prospectus in its entirety and consult your professional adviser in respect of the contents of this Prospectus.

This Prospectus is a short form prospectus prepared in accordance with section 712 of the Corporations Act. This Prospectus does not of itself contain all the information that is generally required to be set out in a document of this type, but refers to parts of other documents lodged with ASIC, the contents of which are therefore taken to be included in this Prospectus.

The Firefinch Directors consider an investment in Leo Lithium Shares that will be distributed and transferred under this Prospectus and the Demerger Resolution to be speculative.

Contents

Page

1	Important notices	2
2	The Offer	4
3	Information deemed to be incorporated in this Prospectus	6
4	Additional information	9
5	Directors' authorisation	11
6	Glossary	12

Gilbert + Tobin

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1 Important notices

• 1.1 General

  This Prospectus is issued by Firefinch Ltd ACN 113 931 105 (Firefinch or the Company).

  This Prospectus is dated 29 April 2022 (Prospectus Date) and was lodged with the Australian Securities and Investments Commission (ASIC) on that date. None of ASIC, the Australian Securities Exchange (ASX) nor any of their respective officers takes any responsibility for the contents of this Prospectus or the merits of the investment to which this Prospectus relates.

  This Prospectus expires on the date which is 13 months after the Prospectus Date (Expiry Date). No Leo Lithium Shares will be offered or transferred on the basis of this Prospectus after the Expiry Date.

  The information contained in this Prospectus is not investment or financial product advice and has been prepared as general information only, without consideration for your particular investment objectives, financial situation or particular needs.

  It is important that you read this Prospectus, including the Notice of Meeting, which is incorporated by reference into this Prospectus, carefully and in full.

  In particular, you should consider the risk factors that could affect the business, financial condition and financial performance of the Company. You should carefully consider these risks in light of your investment objectives, financial situation and particular needs (including financial and taxation issues) and seek professional advice from your accountant, financial adviser, stockbroker, lawyer or other professional adviser.

  Except as required by law, and only to the extent required, no person named in this Prospectus, nor any other person, warrants or guarantees the performance of the Company, the repayment of capital by the Company or any return on investment made pursuant to this Prospectus.

  No person is authorised to give any information or to make any representation in connection with this Prospectus which is not contained in this Prospectus. Any information or representation not so contained may not be relied on as having been authorised by the Company, the Firefinch Directors, or any other person in connection with this Prospectus. You should rely only on information in this Prospectus.

  Defined terms and abbreviations used in this Prospectus have the meanings given in the Glossary or as provided in the context in which they appear.

  Unless otherwise stated or implied, references to times in this Prospectus are to Perth Time. Unless otherwise stated or implied, references to dates or years are calendar year references.

  References to '$', 'A$' or 'AUD' are references to Australian currency, unless otherwise stated.

• 1.2 Short form prospectus

  This Prospectus is a short form prospectus issued in accordance with section 712 of the Corporations Act. This means this Prospectus alone does not contain all the information that is generally required to satisfy the disclosure requirements of the Corporations Act. Rather, it incorporates all other necessary information by reference to information contained in the Notice of Meeting lodged with ASIC on 29 April 2022.

In referring to the Notice of Meeting, the Company:

• (a) identifies the Notice of Meeting as being relevant to the Offer of Leo Lithium Shares under this Prospectus and contains information for Firefinch Shareholders and their professional advisers to assist them in making an informed assessment of:

  • (i) the rights and liabilities attaching to the Leo Lithium Shares;

  • (ii) the assets, liabilities and financial position and prospects of Leo Lithium;

• (b) refers Firefinch Shareholders and their professional advisers to this Prospectus which summarises the material information in the Notice of Meeting deemed to be incorporated in this Prospectus;

• (c) informs Firefinch Shareholders and their professional advisers that they are able to obtain, free of charge, a copy of the Notice of Meeting or the Firefinch Constitution by contacting the Company at its registered office during normal business hours during the period of the Offer; and

• (d) advises that the information in the Notice of Meeting will be primarily of interest to Firefinch Shareholders and their professional advisers or analysts.

You may, prior to the General Meeting, obtain a paper copy of this Prospectus (free of charge) by contacting the Company Secretary on [phone] or by sending an email [e-mail].

• 1.3 Exposure period

  The Corporations Act prohibits the Company from transferring the Leo Lithium Shares in the seven day period after the date of lodgement of the Prospectus (Exposure Period). The Exposure Period may be extended by ASIC by up to a further seven days. The purpose of the Exposure Period is to enable this Prospectus to be examined by market participants prior to the transfer of the Leo Lithium Shares. As the General Meeting will be held on 31 May 2022 and the Demerger will occur after that date, the Exposure Period will have expired by the time the Demerger occurs.

• 1.4 Forward looking statements

  This Prospectus contains forward looking statements which may be identified by words such as 'anticipates', 'may', 'should', 'could', 'likely', 'believes', 'estimates', 'expects', 'targets', 'predicts', 'projects', 'forecasts', 'intends', 'guidance', 'plan' and other similar words that involve risks and uncertainties.

  These forward looking statements are based on an assessment of present economic and operating conditions, and on a number of assumptions regarding future events and actions that, at the date of the Prospectus, are expected to take place. The Company does not undertake to, and does not intend to, update or revise any forward looking statements, or 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.

  Any forward looking statements are subject to various risks that could cause the Company's actual results to differ materially from the results expressed or anticipated in these statements. Forward looking statements should be read in conjunction with, and are qualified by reference to, the risk factors as set out in the Notice of Meeting and other information in this Prospectus. Such forward looking statements are not guarantees of future performance and are subject to known and unknown risks, uncertainties, assumptions and other important factors, many of which are outside the control of the

Company, the Firefinch Directors and the Company's management. The Company, the Firefinch Directors and the Company's management 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.

1.5 Selling restrictions

This Prospectus does not constitute an offer or invitation in any place in which, or to any person to whom, it would not be lawful to make such an offer or invitation. No action has been taken to register or qualify the Offer in any jurisdiction outside Australia. The distribution of this Prospectus outside Australia (including electronically) may be restricted by law and persons who come into possession of this Prospectus outside Australia should seek advice on and observe any such restrictions. Any failure to comply with such restrictions may constitute a violation of applicable securities laws.

This Prospectus may not be distributed to, or relied upon by, persons in the United States. Leo Lithium Shares have not been, and will not be, registered under the United States Securities Act of 1933, as amended (US Securities Act) or the securities laws of any state or other jurisdiction of the United States and may not be offered, sold, pledged or transferred directly or indirectly, in the United States unless the Leo Lithium Shares have been registered under the US Securities Act or an exemption from the registration requirements of the US Securities Act and any other applicable US state securities laws is available. Upon completion of the In-Specie Distribution, the Leo Lithium Shares will be issued pursuant to an exemption to the registration requirements under the US Securities Act and applicable US state securities laws.

2 The Offer

2.1 Terms and conditions of the Offer

The terms and conditions of the Offer are detailed in the Notice of Meeting accompanying this Prospectus.

In broad terms, the Notice of Meeting includes the Demerger Resolution pursuant to which Firefinch proposes an equal capital reduction to be satisfied by the distribution and transfer of 843,745,158 Leo Lithium Shares held by Firefinch to Eligible Firefinch Shareholders registered as such on the Demerger Record Date in proportion to their respective holdings of Firefinch Shares as at that date.

The Demerger will only proceed if the following conditions are met (together, the Demerger Conditions):

• (a) (Firefinch approvals) Firefinch obtaining all necessary shareholder approvals required by the Corporations Act and its Constitution to give effect to the Demerger;

• (b) (Leo Lithium Offer and ASX admission) Leo Lithium completing the Leo Lithium Offer and ASX granting Leo Lithium conditional approval for its admission to the Official List on conditions satisfactory to Firefinch;

• (c) (ATO class ruling) Firefinch receiving a favourable draft class ruling or other ATO confirmation (to the satisfaction of Firefinch); and

• (d) (No regulatory intervention) no regulatory intervention occurring that would otherwise prevent the Demerger from proceeding.