HARVEST MINERALS LTD ACN SUPPLEMENTARY PROSPECTUS

Transcription

1 HARVEST MINERALS LTD ACN SUPPLEMENTARY PROSPECTUS IMPORTANT INFORMATION This is a supplementary prospectus (Supplementary Prospectus) intended to be read with the prospectus dated 29 May 2015 (Prospectus), issued by Harvest Minerals Ltd (ACN ) (Company). This Supplementary Prospectus is dated 12 June 2015 and was lodged with ASIC on that date. The ASIC and its officers take no responsibility for the contents of this Supplementary Prospectus. This Supplementary Prospectus should be read together with the Prospectus. Other than as set out below, all details in relation to the Prospectus remain unchanged. Terms and abbreviations defined in the Prospectus have the same meaning in this Supplementary Prospectus. If there is a conflict between the Prospectus and this Supplementary Prospectus, this Supplementary Prospectus will prevail. This is an important document and should be read in its entirety. If you do not understand it you should consult your professional advisers without delay. 1. INTRODUCTION On 11 June 2015, the Company entered into a underwriting agreement with CPS Capital Group Pty Ltd (Underwriter) pursuant to which the Underwriter has agreed to fully underwrite the Offer (Underwriting). As a result of the Underwriting, the Company issues this Supplementary Prospectus to set out the impact on the Prospectus that has been issued in respect of the Offer. To the extent that the Prospectus and this Supplementary Prospectus are inconsistent, the terms of this Supplementary Prospectus shall prevail. 2. UNDERWRITING DETAILS AND UNDERWRITING AGREEMENT To include the details of the Underwriting and to summarise the Underwriting Agreement Section 3.5 of the Prospectus be deleted and replaced as follows: 3.5 Underwriting CPS Capital Group Pty Ltd (CPS Capital or the Underwriter) has agreed to fully underwrite the Offer, being $553,816 (Underwritten Amount) and 55,381,666 Shares (Underwritten Shares), under an agreement entered between the Underwriter and the Company entered on 11 June 2015 (Underwriting Agreement). The material terms of the Underwriting Agreement are set out below. (a) (b) (c) Fee: the Company has agreed to pay the Underwriter a fee of 6% of the Underwritten Amount (being $33,229) in consideration for the Underwriter s underwriting obligations. Expenses: additionally, the Company will reimburse the Underwriter for its reasonable costs and expenses up to a maximum of $15,000. Sub-underwriting arrangements: may at any time in its absolute discretion appoint sub-underwriters to sub-underwrite the Underwritten Amount. However no subunderwriters will be related parties. Additionally the Underwriter will not acquire and will ensure that no other party acquires a relevant interest in more than 20% of the voting Shares on completion of the Offer as a result of any Shortfall being placed to the Underwriter (or its nominees). Harvest Minerals Ltd (ACN ). 1

2 (d) Termination Rights: The obligation of the Underwriter to underwrite the Offer is subject to certain events of termination. The Underwriter may terminate its obligations under the Underwriting Agreement, upon or prior to the issue of the underwritten Shares, if: (i) (ii) (iii) (iv) (v) (vi) (vii) (viii) (ix) (x) (xi) (Share Price) the share price of the Company trading on the ASX under the ASX code of HMI finishes trading for 2 consecutive days with a closing share price that is less than the $0.01 during the Offer period; (Indices fall) the S&P or ASX 200 Index closes on any 2 consecutive trading days before the date that is 4 Business Days after the Closing Date (Shortfall Notice Deadline Date) 4% or more below its respective level as at the close of business on the Business Day prior to the execution date; (Prospectus): the Prospectus or the Offer is withdrawn by the Company; (No Official Quotation): ASX has advised the Company that it will or may not grant official quotation to the Underwritten Shares on or prior to the Shortfall Notice Deadline Date; (Restriction on issue): the Company is prevented from issuing the Underwritten Shares within the time required by the Underwriting Agreement, the Corporations Act, the Listing Rules, any statute, regulation or order of a court of competent jurisdiction by ASIC, ASX or any court of competent jurisdiction or any governmental or semi-governmental agency or authority; (Takeovers Panel): the Takeovers Panel makes a declaration that circumstances in relation to the affairs of the Company are unacceptable circumstances under Pt of the Corporations Act, or an application for such declaration is made to the Takeovers Panel; (Hostilities): there is an outbreak of hostilities or a material escalation of hostilities (whether or not war has been declared) after the date of the Underwriting Agreement involving one or more of Australia, New Zealand, Indonesia, Japan, Russia, the United Kingdom, the United States of America, India, Pakistan, or the People s Republic of China, Israel or any member of the European Union, or a terrorist act is perpetrated on any of those countries or any diplomatic, military, commercial or political establishment of any of those countries anywhere in the world, which in the reasonable opinion of the Underwriter has or is likely to have a material adverse effect on the Offer; (Authorization): any authorization which is material to anything referred to in the Prospectus is repealed, revoked or terminated or expires, or is modified or amended in a manner unacceptable to the Underwriter; (Event of Insolvency): an event of insolvency occurs in respect of a Relevant Company; (Indictable offence): a director or senior manager of a Relevant Company is charged with an indictable offence, which in the reasonable opinion of the Underwriter has or is likely to have a material adverse effect on the Offer; or (Termination Events): upon the occurrence of any of the following events subject to in the reasonable opinion of the Underwriter reached in good faith, it has or is likely to have, or those events together have, or could reasonably be expected to have, a material adverse effect or could give rise to a liability of the Underwriter under the Corporations Act: (A) (Default): default or breach by the Company under the Underwriting Agreement of any terms, condition, covenant or undertaking which is incapable of remedy or is not remedied by the date the Underwriter must apply for the Shortfall Shares; Harvest Minerals Ltd (ACN ). 2

3 (B) (Incorrect or untrue representation): any representation, warranty or undertaking given by the Company in the Underwriting Agreement is or becomes untrue or incorrect; (C) (D) (E) (F) (G) (H) (I) (J) (K) (L) (M) (N) (Contravention of constitution or Act): a contravention by the Company or any of its subsidiaries (Relevant Companies) of any provision of its constitution, the Corporations Act, the Listing Rules or any other applicable legislation or any policy or requirement of ASIC or ASX; (Adverse change): an event occurs which gives rise to a material adverse effect in relation to the Company s assets, liabilities, financial position, trading results, profits, forecasts, losses, prospects, business or operations of any Relevant Company; (Error in Due Diligence Results): it transpires that any of the due diligence results or any part of the verification material was false, misleading or deceptive or that there was an omission from them that is materially adverse from the point of view of an investor (Significant change): a "new circumstance" as referred to in Section 719(1) of the Corporations Act arises that is materially adverse from the point of view of an investor; (Public statements): without the prior approval of the Underwriter a public statement is made by the Company in relation to the Offer or the Prospectus; (Misleading information): any information supplied at any time by the Company or any person on its behalf to the Underwriter in respect of any aspect of the Offer or the affairs of any Relevant Company is or becomes misleading or deceptive or likely to mislead or deceive; (Change in Act or policy): there is introduced, or there is a public announcement of a proposal to introduce, into the Parliament of Australia or any of its States or Territories any Act or prospective Act or budget or the Reserve Bank of Australia or any Commonwealth or State authority adopts or announces a proposal to adopt any new, or any major change in, existing, monetary, taxation, exchange or fiscal policy; (Prescribed Occurrence): a prescribed occurrence occurs, other than as disclosed in the Prospectus; (Suspension of debt payments): the Company suspends payment of its debts generally; (Judgment against a Relevant Company): a judgment in an amount exceeding $50,000 is obtained against a Relevant Company and is not set aside or satisfied within 7 days; (Litigation): litigation, arbitration, administrative or industrial proceedings are after the date of the Underwriting Agreement commenced against any Relevant Company, other than any claims foreshadowed in the Prospectus; (Board and senior management composition): there is a change in the composition of the Board or a change in the senior management of the Company before the date of issue of the Underwritten Shares without the prior written consent of the Underwriter; Harvest Minerals Ltd (ACN ). 3

4 (O) (P) (Q) (R) (S) (T) (U) (V) (Change in shareholdings): there is a material change in the major or controlling shareholdings of a Relevant Company or a takeover offer or scheme of arrangement pursuant to Chapter 5 or 6 of the Corporations Act is publicly announced in relation to a Relevant Company; (Timetable): there is a delay in any specified date in the Timetable which is greater than 3 Business Days; (Force Majeure): a force majeure affecting the Company's business or any obligation under the Agreement lasting in excess of 7 days occurs; (Certain resolutions passed): a Relevant Company passes or takes any steps to pass a resolution under Section 254N, Section 257A or Section 260B of the Corporations Act or a resolution to amend its constitution without the prior written consent of the Underwriter; (Capital Structure): any Relevant Company alters its capital structure in any manner not contemplated by the Prospectus & the Mandate; (Breach of Material Contracts): any of the material contracts is terminated or substantially modified; (Investigation): any person is appointed under any legislation in respect of companies to investigate the affairs of a Related Company; or (Market Conditions): a suspension or material limitation in trading generally on ASX occurs or any material adverse change or disruption occurs in the existing financial markets, political or economic conditions of Australia, Japan, the United Kingdom, the United States of America or other international financial markets. 3. EFFECT OF CONTROL To address the effect on control of the underwriting the following section is included after Section A Effect of the Underwriting on control of the Company 4. LEAD MANAGER MANDATE The Underwriter is not presently a Shareholder of the Company. Therefore assuming no Shareholder takes up their Entitlement the maximum potential voting power of the Underwriter as a result of the Underwriting will be 10.71%. However, it is noted that the Underwriter intends to enter into sub-underwriting agreements with non-associated and non-related party entities to sub-underwrite the Underwritten Shares. It is also unlikely that no Shareholders, will take up entitlements under the Offer. Accordingly, the voting power of the Underwriter is likely to be less than the maximum disclosed. To include the Underwriters lead manager role in the Offer the following section is included after Section 3.5A. 3.5B Lead manager/broker In addition to underwriting the Offer, CPS Capital has also been appointed as lead manager and broker to the Offer under a mandate entered between the Company and CPS Capital (Mandate). Harvest Minerals Ltd (ACN ). 4

5 The fees payable under the Underwriting Agreement and summarised above in Section 3.5 are inclusive of the fees payable in respect of the Offer under the Mandate. Additionally, under the Mandate, the Company has agreed to pay CPS Capital a monthly retainer of $5,000 for a period of 12 months for the provision of on-going corporate advisory services to the Company. 5. SHORTFALL OFFER As a result of the Underwriting, the last paragraph in Section 4.6 of the Prospectus will be deleted and replaced as follows: Shortfall Shares will only be issued if the Offer is undersubscribed and will only be issued to the extent necessary to make up any shortfall in subscriptions. Eligible Shareholders applying for in excess of their full Entitlement will have priority under the Shortfall Offer subject to applications being received by the Closing Date of the Offer. In the event of oversubscription from these applications they will be scaled back on a pro-rata basis. Any remaining Shortfall will be subscribed for by the Underwriter in satisfaction of their commitment under the Underwriting Agreement. No issue will be made under the Shortfall Offer if this would result in a person acquiring a relevant interest in more than 20% of the voting Shares immediately following that issue. 6. USE OF FUNDS As a result of the Underwriting and the associated increase to the expenses of the Offer, the table contained in Section 5.1 of the Prospectus is replaced with the following: Item Proceeds of the Offer Full Subscription ($) % 1. Exploration and development of Capella Potash Project 2 Exploration and development of the Arapua Fertilizer Project 258, , Expenses of the Offer 1 51, Total 553, % 7. EFFECT OF THE OFFER As a result of the Underwriting, Section 5.2 of the Prospectus is replaced with the following: The principal effect of the Offer, assuming all Entitlements are accepted and no Options are exercised prior to the Record Date, will be to: (i) (ii) increase the cash reserves by $501,998 (after deducting the estimated expenses of the Offer) immediately after completion of the Offer; and increase the number of Shares on issue from 332,290,000 as at the date of this Prospectus to 387,671,666 Shares. 8. PRO-FORMA BALANCE SHEET As a result of the Underwriting, the associated increase to the expenses of the Offer and in order to correct the wrongful inclusion of the effect of the $600,000 placement (that was announced on 27 May 2015) in the Unaudited 30-Apr-15 figures contained in Pro-forma Balance Sheet, Section 5.3 of the Prospectus is replaced with the following: Harvest Minerals Ltd (ACN ). 5

6 Unaudited 30-Apr-15 Subsequent Event 1 Impact of the Offer Unaudited Pro-forma 30-Apr-15 $ $ $ ASSETS Current Assets Cash and cash equivalents 926, , ,998 2,028,320 Receivables 16, ,766 Total Current Assets 943, , ,998 2,045,086 Non-Current Assets Property, plant and equipment 17, ,209 Exploration 2,172, ,172,653 Total Non-Current Assets 2,189, ,189,862 Total Assets 3,132, , ,998 4,234,948 Current Liabilities Trade and other payables 679, ,749 Total Current Liabilities 679, ,749 Total Liabilities 679, ,749 Net Assets 2,453, , ,998 3,555,199 EQUITY Issued capital 1 13,401, , ,998 14,503,116 Reserves 2,645, ,645,525 Accumulated losses (13,593,442) - - (13,593,442) Total Equity 2,453, , ,998 3,555,199 Note: 1. As announced on the ASX on 27 May 2015 the Company completed a raising of $600,000 from sophisticated investors. This has been included as a subsequent event above. 9. EXPENSES OF THE OFFER As a result of the Underwriting and the associated increase to the expenses of the Offer, Section 8.6 of the Prospectus is deleted and replaced as follows: In the event that all Entitlements are accepted, the total expenses of the Offer are estimated to be approximately $51,818 (excluding GST) and are expected to be applied towards the items set out in the table below: Harvest Minerals Ltd (ACN ). 6

7 Item $ ASIC fees 2,290 ASX fees 3,589 Legal fees 10,000 Underwriting Fees 33,229 Printing, distribution and other expenses 2,710 Total 51, INTEREST AND CONSENT OF UNDERWRITER CPS Capital will be paid an underwriting fee of approximately $33,229 in respect of the Offer. As per the terms of the Mandate, CPS Capital will also receive a monthly retainer of $5,000 for a period of 12 months for providing on-going corporate advisory services to the Company. CPS Capital has given its written consent to being named as Underwriter to the Offer. CPS Capital has not withdrawn its consent prior to the lodgement of the Supplementary Prospectus with the ASIC. 11. DIRECTORS AUTHORISATION This Supplementary Prospectus is issued by the Company and its issue has been authorised by a resolution of the Directors. In accordance with Section 720 of the Corporations Act, each Director has consented to the lodgement of this Supplementary Prospectus with the ASIC. Brian McMaster Executive Chairman For and on behalf of HARVEST MINERALS LTD Harvest Minerals Ltd (ACN ). 7