☒ | REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR (g) OF THE SECURITIES EXCHANGE ACT OF 1934 |
☐ | ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
☐ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
☐ | SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
N/A | | | AUSTRALIA |
(Translation of Registrant’s name into English) | | | (Jurisdiction of incorporation or organization) |
Title of each class: | | | Name of each exchange on which registered or to be registered: |
American Depositary Shares each representing 10 Ordinary Shares, no par value(1) | | | The Nasdaq Stock Market LLC |
(1) | Evidenced by American Depositary Receipts |
Large accelerated filer | | | ☐ | | | Accelerated filer | | | ☐ | | | Non-accelerated filer | | | ☒ | | | Emerging growth company | | | ☒ |
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• | “IperionX” refers to IperionX Limited, an Australian corporation; |
• | “the Company,” “we,” “us,” or “our” refer to IperionX and its consolidated subsidiaries, through which it conducts its business, unless otherwise indicated; |
• | “shares” or “ordinary shares” refers to ordinary shares of IperionX; |
• | “ADS” refers to the American depositary shares; and |
• | “ASX” refers to the Australian Securities Exchange. |
IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS |
Name | | | Position |
Anastasios (Taso) Arima | | | Chief Executive Officer and Managing Director |
Todd W. Hannigan | | | Executive Chairman |
Lorraine M. Martin | | | Independent Non-Executive Director |
Vaughn W. Taylor | | | Independent Non-Executive Director |
Melissa G. Waller | | | Independent Non-Executive Director |
Beverly M. Wyse | | | Independent Non-Executive Director |
Dominic P. Allen | | | Vice President and Chief Commercial Officer |
Lamont Leatherman | | | Vice President and Chief Geologist |
Toby Symonds | | | Vice President and Chief Strategy Officer |
Jeanne McMullin | | | Vice President and Chief Legal Officer |
Gregory D. Swan | | | Vice President and Company Secretary (principal financial officer) |
OFFER STATISTICS AND EXPECTED TIMETABLE |
KEY INFORMATION |
| | As of December 31, 2021 (US$) | |
Cash and cash equivalents | | | US$14,256,359 |
Non-current debt | | | — |
Equity | | | |
Contributed equity | | | 29,669,773 |
Reserves | | | 9,175,176 |
Accumulated losses | | | (23,792,992) |
Total equity | | | US$15,051,957 |
Total capitalization | | | US$15,051,957 |
• | Nasdaq’s requirement that our independent directors meet regularly in executive sessions. The ASX Listing Rules and the Corporations Act do not require the independent directors of an Australian company to have such executive sessions and, accordingly, we have claimed this exemption. |
• | Nasdaq’s requirement that an issuer provide for a quorum as specified in its bylaws for any meeting of the holders of ordinary shares, which quorum may not be less than 33 1/3% of the outstanding shares of an issuer’s voting ordinary shares. In compliance with Australian law, our Constitution provides that two shareholders present shall constitute a quorum for a general meeting. |
• | Nasdaq’s requirement that issuers obtain shareholder approval prior to the issuance of securities in connection with certain acquisitions, changes of control or private placements of securities, or the establishment or amendment of certain stock option, purchase or other compensation plans. Applicable Australian law and 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 an additional 10% capacity to issue equity securities for the proceeding 12-month period if shareholder approval by special resolution is sought at the Company’s annual general meeting) of our issued share capital in any 12-month period (but, in determining the available issue 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) directors or their associates acquiring securities under an employee incentive plan. |
• | We have not sufficiently designed, implemented and documented internal controls at the entity level and across the key business and financial processes to allow us to achieve complete, accurate and timely financial reporting. |
• | We have not designed and implemented controls to maintain appropriate segregation of duties in our manual and IT based business processes. |
INFORMATION ON THE COMPANY |
• | Continue to research, investigate, scale-up and commercialize the Technologies to produce titanium metal powders for the stakeholders within defense, space, aerospace, electric vehicles and additive manufacturing. |
• | Complete techno-economic evaluations, including providing titanium samples produced using the Technologies for potential customers, to outline material physical and economic metrics of the development of the Technologies as well as securing long term offtake contracts. |
• | Continue to investigate potential alternative applications of the Technologies to develop additional value-added metal closed-loop production capabilities, including zircon and synthetic rutile, and the potential production of rare earth elements. |
• | Continue to progress Environmental, Sustainability and Corporate Governance (“ESG”) assessments and integration studies to outline material physical and economic ESG metrics as well as major development milestones and timelines. |
• | Continue discussions with potential customers and strategic partners for future production and sale of titanium metal products and critical minerals, including, but not limited to rare earth elements. |
• | Continue to expand IperionX’s land position in the United States, explore for additional critical minerals and secure relevant permit and zoning approvals. |
• | Patented titanium metal production technologies. We have an exclusive option to acquire Blacksand which holds the exclusive commercial licensing rights for the patented Technologies to produce low carbon titanium metal and spherical powders developed by Blacksand at the University of Utah with support from ARPA-E. |
• | Market opportunity that capitalizes on a shift to low carbon metal production. The social and macroeconomic shift to the low carbon production of metals and a circular economy provides a significant opportunity for IperionX to apply the Technologies and position us to take advantage of a compelling high growth market. |
• | Ability to recycle existing titanium metal feedstock and titanium metal products in a closed-loop process. The Technologies have demonstrated, at pilot-scale, to be capable of producing fully recycled titanium metal powders using titanium scrap as feedstock in a closed-loop process, technology that potentially offers lower cost, low carbon titanium metal and powders. |
• | Differentiated and integrated U.S. domestic supply chain. We believe that our integrated business model in the U.S. will allow us to achieve our objective to provide a domestic end-to-end supply chain of low-cost and low carbon titanium metal for strategic and high value applications including light-weighting for electric vehicles and battery packs as well as broad defense and light-weighting applications for commercial and military applications. |
• | Sales of critical minerals. The Titan Project contains titanium minerals that can supply the titanium pigment and metals markets as well as the Technologies. It also contains significant volumes of other highly valuable critical minerals which may be sold as co-products, including zircon and rare earth elements. |
• | Strategically located close to existing processing facilities. The Titan Project is strategically located in the southeastern U.S., close to significant manufacturing capacity, including the Chemours facility in New Johnsonville TN, one of the world’s largest producers of titanium dioxide. |
• | Significant existing infrastructure available. The Titan Project’s location enjoys low-cost access to road, rail and water logistics connecting it to world class manufacturing industries. The Titan Project is also well situated to take advantage of a highly skilled labor force and low-cost renewable baseload grid power. |
• | First mover in restarting exploration of critical minerals in the West Tennessee area. As a first mover in restarting exploration of critical minerals in West Tennessee, IperionX aims to develop a strategic, U.S. domestic source of high-quality, low-cost and low carbon titanium metal products and other critical minerals, including rare earths and silica sand. The Titan Project is located in an area which saw significant historic exploration from the 1950’s to the 1990’s by companies including DuPont, Kerr-McGee Corp., BHP Group, RGC Ltd and Altair International Corp. |
• | Experienced management team. Our senior management team has significant experience in acquiring, developing, and financing minerals extraction projects in the United States. They have previously held senior business development, financial, and operational positions at both large, publicly traded extraction companies as well as successful private extraction operations. |
• | IperionX has a non-binding Memorandum of Understanding (“MOU”) to potentially establish a partnership with Energy Fuels that aims to build an integrated, all-American rare earths supply chain. |
• | IperionX has a non-binding MOU with Chemours to investigate a potential supply agreement between IperionX and Chemours for up to 50,000 metric tons of ilmenite, 10,000 metric tons of rutile, and 10,000 metric tons of staurolite. Chemours operates one of the largest titanium dioxide plants at its New Johnsonville plant which is located approximately 20 miles from IperionX’s Titan Project in Tennessee. |
• | IperionX has a non-binding MOU with EOS to accelerate the deployment of the Technologies for the potential production of low-cost, low carbon titanium metal powders. IperionX and EOS have agreed to negotiate in good faith to enter into definitive agreements to give effect to a partnership that allows IperionX and EOS to work together to advance deployment of spherical and non-spherical titanium metal powders for use in the additive manufacturing industry. |
• | IperionX has a non-binding MOU with Mario Pilato BLAT S.A. for the potential supply of zircon products. The MOU contemplates a supply agreement for an initial five-year term on an agreed market-based pricing methodology for the annual supply of up to 20,000 tonnes of zircon products from IperionX’s Titan Project in Tennessee. |
• | Fluctuations in the market prices for critical materials, titanium metal, titanium minerals and rare earth minerals; |
• | Fluctuating supplies of critical materials, titanium metal, titanium minerals and rare earth minerals; |
• | Fluctuating demand for critical materials, titanium metal, titanium minerals and rare earth minerals; and |
• | Metals and extraction activities of others. |
• | completing our exploration drilling program on initial land position and continuing to secure additional land leases to undertake additional exploration; |
• | undertaking necessary technical studies to assess the economic potential of the Titan Project and defining a critical minerals reserve base; |
• | completing required permitting and zoning activities; |
• | undertaking discussions with potential customers for future sale of titanium and other critical minerals, including rare earths; |
• | completing required financing activities; |
• | completing construction of the Titan Project’s minerals extraction and processing facilities; and |
• | commencing minerals extraction and processing activities to supply the United States demand for clean, low-cost domestic sources of titanium and other critical minerals, including rare earths. |
• | the last day of the fiscal year during which we have total annual gross revenues of US$1,070,000,000 (as such amount is indexed for inflation every five years by the SEC) or more; |
• | the last day of our fiscal year following the fifth anniversary of the completion of our first sale of common equity securities pursuant to an effective registration statement under the Securities Act; |
• | the date on which we have, during the previous three-year period, issued more than US$1,070,000,000 in non-convertible debt; or |
• | the date on which we are deemed to be a “large accelerated filer”, as defined in Rule 12b-2 of the U.S. Securities Exchange Act of 1934, as amended, or the Exchange Act, which would occur if the market value of our ordinary shares and ADSs that are held by non-affiliates exceeds US$700,000,000 as of the last day of our most recently completed second fiscal quarter. |
• | Nasdaq’s requirement that our independent directors meet regularly in executive sessions. The ASX Listing Rules and the Corporations Act do not require the independent directors of an Australian company to have such executive sessions and, accordingly, we have claimed this exemption. |
• | Nasdaq’s requirement that an issuer provide for a quorum as specified in its bylaws for any meeting of the holders of ordinary shares, which quorum may not be less than 33 1/3% of the outstanding shares of an issuer’s voting ordinary shares. In compliance with Australian law, our Constitution provides that two shareholders present shall constitute a quorum for a general meeting. |
• | Nasdaq’s requirement that issuers obtain shareholder approval prior to the issuance of securities in connection with certain acquisitions, changes of control or private placements of securities, or the |
• | National Environmental Protection Act (“NEPA”), which requires careful evaluation of the environmental impacts of extraction operations that require federal approvals; |
• | Clean Air Act (“CAA”) and its amendments, which governs air emissions; |
• | Clean Water Act (“CWA”), which governs discharges to and excavations within the waters of the United States; |
• | Safe Drinking Water Act (“SDWA”), which governs the underground injection and disposal of wastewater; |
• | Resource Conservation and Recovery Act (“RCRA”), which governs the management of solid waste; |
• | Comprehensive Environmental Response, Compensation, and Liability Act (“CERCLA”), which imposes liability where hazardous substances have been released into the environment (commonly known as Superfund); and |
• | Federal Mine Safety and Health Act, which established the primary safety and health standards regarding working conditions of employees engaged in extraction, related operations, and preparation and milling of the minerals extracted, as well as the Occupation Safety and Health Act, which regulates the protection of the health and safety of workers to the extent such protection is not already addressed by the Federal Mine Safety and Health Act. |
• | Require notice to stakeholders of proposed and ongoing operations. |
• | Require the installation of pollution control equipment. |
• | Restrict the types, quantities and concentration of various substances that can be released into the environment in connection with minerals extraction or drilling activities. |
• | Limit or prohibit extraction or drilling activities on lands located within wetlands, areas inhabited by endangered species and other protected areas, or otherwise restrict or prohibit activities that could impact the environment, including water resources. |
• | Impose substantial liabilities for pollution resulting from current or former operations on or for any preexisting environmental impacts at the Titan Project site. |
• | Require preparation of an Environmental Assessment or an Environmental Impact Statement. |
OPERATING AND FINANCIAL REVIEW AND PROSPECTS |
Continuing operations | | | Six Months Ended December 31, 2021 US$ | | | Six Months Ended December 31, 2020 (restated) US$ |
Exploration and evaluation expenses | | | (3,431,522) | | | (285,215) |
Corporate and administrative expenses | | | (998,378) | | | (185,031) |
Business development expenses | | | (1,501,724) | | | (71,946) |
Share-based payment expense | | | (4,764,135) | | | (841,896) |
Finance income | | | 157,435 | | | 118 |
Finance costs | | | (23,831) | | | — |
Cost of listing on reverse acquisition | | | — | | | (5,141,126) |
Unaudited Pro Forma Combined Statement of Profit or Loss | | | HMAPL (accounting acquirer) For the period from July 20, 2020 to June 30, 2021 (historical) US$ | | | TAO (accounting acquiree) For the period from July 1 to December 1, 2020 (historical) US$ | | | Acquisition Adjustments US$ | | | Pro Forma Combined US$ |
Continuing operations | | | | | | | | | ||||
Exploration and evaluation expenses | | | (2,568,386) | | | (43,620) | | | — | | | (2,612,006) |
Corporate and administrative expenses | | | (852,944) | | | (262,889) | | | — | | | (1,115,833) |
Business development expenses | | | (581,200) | | | — | | | — | | | (581,200) |
Share based payment expenses | | | (4,084,764) | | | (62,716) | | | — | | | (4,147,480) |
Finance income | | | 5,075 | | | 2,775 | | | — | | | 7,850 |
Finance costs | | | (7,492) | | | — | | | — | | | (7,492) |
Cost of listing on reverse acquisition | | | (5,141,126) | | | — | | | — | | | (5,141,126) |
Impairment expenses | | | — | | | (332,881) | | | — | | | (332,881) |
Other expenses | | | — | | | (47,917) | | | — | | | (47,917) |
Loss before income tax | | | (13,230,837) | | | (747,248) | | | — | | | (13,978,085) |
Income tax expense | | | — | | | — | | | — | | | — |
Loss for the year | | | (13,230,837) | | | (747,248) | | | — | | | (13,978,085) |
| | | | | | | | |||||
Loss per share: | | | | | | | | | ||||
Weighted average number of ordinary shares – basic and diluted | | | 60,336,252 | | | 31,737,316 | | | — | | | 60,336,252 |
Loss per ordinary share – basic and diluted | | | US$0.22 | | | US$0.02 | | | — | | | US$0.23 |
• | the audited financial statements of HMAPL for the period from July 20, 2020 to June 30, 2021 and related notes, included elsewhere in this Form 20-F, which have been prepared as a continuation of the financial statements of HMAPL, due to the fact that, for accounting purposes, HMAPL is deemed to be the acquirer of the Company; and |
• | the audited financial statements of TAO for the period from July 1, 2020 to December 1, 2020 and related notes, included elsewhere in this Form 20-F, which have been prepared on a standalone basis for the period prior to consummation of the Reverse Asset Acquisition on December 1, 2020. |
| | Six Months Ended December 31, | | | Year Ended June 30, | |
| | 2021 | | | 2021 | |
Net cash provided by (used in): | | | | | ||
Operating activities | | | $(5,900,944) | | | $(3,558,025) |
Investing activities | | | (744,865) | | | (571,568) |
Financing activities | | | 19,295,299 | | | 5,829,916 |
Net increase (decrease) in cash and cash equivalents | | | $12,649,490 | | | US$1,700,323 |
DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES |
Name | | | Age | | | Position |
Anastasios (Taso) Arima | | | 37 | | | Chief Executive Officer and Managing Director |
Todd W. Hannigan | | | 49 | | | Executive Chairman |
Lorraine M. Martin | | | 59 | | | Independent Non-Executive Director |
Vaughn W. Taylor | | | 37 | | | Independent Non-Executive Director |
Melissa G. Waller | | | 51 | | | Independent Non-Executive Director |
Beverly M. Wyse | | | 59 | | | Independent Non-Executive Director |
Dominic P. Allen | | | 38 | | | Vice President and Chief Commercial Officer |
Lamont Leatherman | | | 56 | | | Vice President and Chief Geologist |
Toby Symonds | | | 53 | | | Vice President and Chief Strategy Officer |
Jeanne McMullin | | | 55 | | | Vice President and Chief Legal Officer |
Gregory D. Swan | | | 40 | | | Vice President and Company Secretary (principal financial officer) |
• | recruit, incentivize and retain KMP and other key employees and contractors needed to achieve our business objectives; |
• | link the reward of key staff with the achievement of strategic goals and the long-term performance of the Company; |
• | align the financial interest of participants of the Plan with those of shareholders; and |
• | provide incentives to participants of the Plan to focus on superior performance that creates shareholder value. |
2021 | | | Short-term benefits | | | Post- employment benefits US$ | | | Termination benefits US$ | | | Share-based payments US$ | | | Total US$ | | | Performance related % | |||
| Salary & fees US$ | | | Other US$ | | ||||||||||||||||
Current KMP | | | | | | | | | | | | | | | |||||||
Todd Hannigan(1) | | | 18,670 | | | — | | | 1,774 | | | — | | | 981,359 | | | 1,001,803 | | | 98% |
Anastasios Arima(2) | | | 87,514 | | | — | | | 1,543 | | | — | | | 1,052,363 | | | 1,141,420 | | | 92% |
Vaughn Taylor(3) | | | 8,962 | | | — | | | — | | | — | | | 73,167 | | | 82,129 | | | 89% |
Dominic Allen(4) | | | 45,704 | | | — | | | — | | | — | | | 496,205 | | | 541,909 | | | 92% |
Lamont Leatherman(5) | | | 45,000 | | | — | | | — | | | — | | | 74,483 | | | 119,483 | | | 62% |
Gregory Swan(6) | | | — | | | — | | | — | | | — | | | 391,309 | | | 391,309 | | | 100% |
Former KMP | | | | | | | | | | | | | | | |||||||
Patric Glovac(7) | | | 48,168 | | | — | | | 1,490 | | | — | | | 335,930 | | | 385,588 | | | 87% |
Mark Connelly(8) | | | 8,908 | | | — | | | 846 | | | — | | | 216,756 | | | 226,510 | | | 96% |
Frank Knezovic(9) | | | 4,481 | | | — | | | 426 | | | — | | | 59,587 | | | 64,494 | | | 92% |
Alastair Smith(10) | | | 7,839 | | | — | | | — | | | — | | | — | | | 7,839 | | | — |
| | 275,246 | | | — | | | 6,079 | | | — | | | 3,681,159 | | | 3,962,484 | | |
(1) | Mr. Hannigan was appointed effective February 1, 2021. |
(2) | Mr. Arima was appointed as Executive Director of the Company effective December 1, 2020 and as CEO and Managing Director of the Company effective from March 1, 2021. Mr. Arima was appointed as Director of HMAPL on July 20, 2020. |
(3) | Mr. Taylor was appointed effective March 3, 2021. |
(4) | Mr. Allen was appointed Corporate Development Officer of the Company effective December 1, 2020. Mr. Allen was appointed as Director of HMAPL on July 20, 2020. |
(5) | Mr. Leatherman was appointed effective December 1, 2020. Mr. Leatherman was appointed as a consultant of HMAPL on July 20, 2020. |
(6) | Mr. Swan was appointed Company Secretary of the Company effective December 16, 2020. Mr. Swan provides services as the Company Secretary through a services agreement with Apollo Group Pty Ltd (“Apollo”). During the period, Apollo was paid or is payable A$105,000 for the provision of serviced office facilities and administrative, accounting and company secretarial services to the Group. Mr. Swan was appointed as Director of HMAPL on July 20, 2020. |
(7) | Mr. Glovac resigned effective March 1, 2021. US$33,905 received by Mr. Glovac prior to completion of the reverse acquisition on December 1, 2020 has been excluded. |
(8) | Mr. Connelly resigned effective February 18, 2021. US$20,444 received by Mr. Connelly prior to completion of the reverse acquisition on December 1, 2020 has been excluded. |
(9) | Mr. Knezovic resigned effective December 29, 2020. US$12,266 received by Mr. Knezovic prior to completion of the reverse acquisition on December 1, 2020 has been excluded. |
(10) | Mr. Smith appointed effective January 11, 2021 and resigned effective April 23, 2021. |
• | act honestly, in good faith and in the best interests of the Company as a whole; |
• | exercise their duty to use due care and diligence in fulfilling the functions of their position; |
• | recognize that their primary responsibility is to the Company’s shareholders as a whole; |
• | not take advantage of their position for personal gain, or the gain of their associates; and |
• | preserve the confidentiality of sensitive information of the Company. |
| | United States | | | Australia | | | Canada | |
Employees | | | 19 | | | 1 | | | — |
Employee Contractors | | | 19 | | | 2 | | | 3 |
Shareholder | | | Ordinary Shares Beneficially Owned(1) | |||
| Number | | | Percent | ||
Officers and Directors | | | | | ||
Anastasios (Taso) Arima | | | 4,937,500 | | | 3.5% |
Todd W. Hannigan | | | 11,169,086 | | | 7.9% |
Lorraine M. Martin | | | — | | | * |
Vaughn W. Taylor | | | 376,829 | | | * |
Melissa G. Waller | | | — | | | * |
Beverly M. Wyse | | | — | | | * |
Dominic P. Allen | | | 3,352,500 | | | 2.4% |
Lamont Leatherman | | | 3,302,500 | | | 2.3% |
Toby Symonds | | | — | | | * |
Jeanne McMullin | | | — | | | * |
Gregory D. Swan | | | 2,250,000 | | | 1.6% |
Officers and directors as a group (10 persons) | | | 25,388,415 | | | 18.0% |
* | Represents beneficial ownership of less than 1% of the outstanding ordinary shares of IperionX. |
(1) | Beneficial ownership is determined according to the rules of the SEC and generally means that a person has beneficial ownership of a security if he, she or it possesses sole or shared voting or investment power of that security, including options and performance rights that are currently exercisable or exercisable within 60 days of December 31, 2021. |
MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS |
Shareholder | | | Ordinary Shares Beneficially Owned | |||
| Number | | | Percent | ||
FMR LLC (1 St. Martin’s Le Grand, London, EC1A 4AS, United Kingdom) | | | 13,499,999 | | | 9.7% |
DITM Holdings Pty Ltd (15 Lennox Street, Mosman, NSW, 2088, Australia)(1) | | | 11,169,086 | | | 7.9% |
(1) | DITM Holdings Pty Limited is an Australian corporation controlled by Mr. Todd Hannigan. |
• | FMR LLC became a substantial shareholder on August 31, 2021, when it acquired 13,499,999 ordinary shares, or 9.7% of the total voting power, pursuant to a private placement by the Company; |
• | DITM Holdings Pty Ltd became a substantial shareholder on December 1, 2020, when it reported that it held 4,618,357 ordinary shares, or 5.3% of the total voting power, as of that date. On January 27, 2021, DITM Holdings Pty Ltd had a change in substantial holding (due to additional purchases) and reported it held 7,951,691 ordinary shares, or 8.1% of the total voting power, as of that date. DITM Holdings Pty Ltd is an entity associated with Mr. Todd Hannigan, Director of the Company; |
• | Arredo Pty Ltd became a substantial shareholder on December 1, 2020, when it reported that it held 5,475,000 ordinary shares, or 6.3% of the total voting power, as of that date. Arredo Pty Ltd ceased to be a substantial holder on August 31, 2021 (due to dilution); |
• | Syracuse Capital Pty Ltd became a substantial shareholder on June 18, 2019, when it reported that it held 2,107,784 ordinary shares, or 6.8% of the total voting power, as of that date. On October 29, 2019, Syracuse Capital Pty Ltd had a change in substantial holding (due to additional purchases) and reported it held 2,364,854 ordinary shares, or 7.5% of the total voting power, as of that date. On April 20, 2020, Syracuse Capital Pty Ltd had a change in substantial holding (due to additional purchases) and reported it held 2,919,778 ordinary shares, or 9.3% of the total voting power, as of that date. On September 24, 2020, Syracuse Capital Pty Ltd had a change in substantial holding (due to additional purchases) and reported it held 3,464,944 ordinary shares, or 11.0% of the total voting power, as of that date. Syracuse Capital Pty Ltd ceased to be a substantial holder on February 1, 2021 (due to dilution); |
• | IPConcept (Luxembourg) S.A. became a substantial shareholder on October 21, 2020, when it reported that it held 1,700,000 ordinary shares, as of that date. IPConcept (Luxembourg) S.A. ceased to be a substantial holder on December 7, 2021 (due to dilution); |
• | Mounts Bay Investments Pty Ltd became a substantial shareholder on April 16, 2018, when it reported that it held 1,874,444 ordinary shares, or 6.1% of the total voting power, as of that date. On August 3, 2018, Mounts Bay Investments Pty Ltd had a change in substantial holding (due to additional purchases) and reported it held 1,909,444 ordinary shares, or 6.2% of the total voting power, as of that date. On September 24, 2020, Mounts Bay Investments Pty Ltd had a change in substantial holding (due to additional purchases) and reported it held 2,269,444 ordinary shares, or 7.2% of the total voting power, as of that date. Mounts Bay Investments Pty Ltd ceased to be a substantial holder on December 2, 2020 (due to dilution); and |
• | Mr. Patric Glovac became a substantial shareholder on November 3, 2020, when he reported that he held 1,859,445 ordinary shares, or 5.7% of the total voting power, as of that date. Mr. Patric Glovac ceased to be a substantial holder on December 2, 2020 (due to dilution). |
FINANCIAL INFORMATION. |
THE OFFER AND LISTING |
ADDITIONAL INFORMATION |
• | 5,224,000 Unlisted Options exercisable at A$0.25 each on or before December 31, 2023; |
• | 3,650,000 Unlisted Options exercisable at A$0.20 each on or before December 31, 2023; |
• | 5,000,000 Unlisted Options exercisable at A$0.20 each on or before December 1, 2025; |
• | 4,000,000 Class A Performance Unlisted Options exercisable at A$0.20 each on or before December 1, 2025; |
• | 4,000,000 Class B Performance Unlisted Options exercisable at A$0.20 each on or before December 1, 2025; |
• | 1,075,000 Unlisted Options exercisable at A$0.45 each on or before December 31, 2023; and |
• | 1,075,000 Unlisted Options exercisable at A$0.55 each on or before December 31, 2023. |
• | 5,698,331 Performance Rights that vest upon achieving a 30-day VWAP of A$2.00 per share, expiring April 23, 2026; |
• | 6,698,334 Performance Rights that vest upon achieving a 30-day VWAP of A$3.00 per share, expiring April 23, 2026; |
• | 10,808,335 Performance Rights that vest upon achieving a 30-day VWAP of A$4.00 per share, expiring April 23, 2026; |
• | 175,000 Performance Rights that vest upon achieving a 30-day VWAP of A$2.00 per share, expiring April 23, 2024; |
• | 275,000 Performance Rights that vest upon achieving a 30-day VWAP of A$3.00 per share, expiring April 23, 2024; |
• | 125,000 Performance Rights that vest upon achieving a 30-day VWAP of A$4.00 per share, expiring April 23, 2024; |
• | 150,000 Performance Rights that vest upon achieving a 30-day VWAP of A$2.00 per share, expiring March 1, 2026; |
• | 150,000 Performance Rights that vest upon achieving a 30-day VWAP of A$3.00 per share, expiring March 1, 2026; |
• | 150,000 Performance Rights that vest upon achieving a 30-day VWAP of A$4.00 per share, expiring March 1, 2026; |
• | 600,000 Unlisted Options exercisable at A$1.33 each on or before September 9, 2025; and |
• | 600,000 Restricted Stock Units that vest upon achieving various service-based conditions, expiring September 9, 2025; |
• | 19,800,000 Class A Performance Shares expiring on December 1, 2024, that will convert into an equivalent number of ordinary shares upon completion of a positive pre-feasibility study (prepared in accordance with the JORC Code and independently verified by a Competent Person) for heavy mineral sands extraction and processing on any of the Titan Project area which demonstrates a net present value of at least A$200,000,000 before September 17, 2024; |
• | 19,800,000 Class B Performance Shares expiring on December 1, 2025, that will convert into an equivalent number of ordinary shares upon the commencement of commercial production from the Titan Project area before September 17, 2025; |
• | 50,000 Performance Rights that vest upon achieving a 30-day VWAP of A$2.00 per share, expiring December 22, 2026; |
• | 100,000 Performance Rights that vest upon achieving a 30-day VWAP of A$3.00 per share, expiring December 22, 2026; |
• | 150,000 Performance Rights that vest upon achieving a 30-day VWAP of A$4.00 per share, expiring December 22, 2026; |
• | 259,000 Performance Rights that vest upon achieving various performance conditions, expiring December 22, 2024; |
• | 261,000 Performance Rights that vest upon achieving various performance conditions, expiring December 22, 2025; and |
• | 265,000 Performance Rights that vest upon achieving various performance conditions, expiring December 22, 2026. |
• | On October 19, 2018, we issued 220,000 ordinary shares to a consultant in lieu of fees for services; |
• | On October 25, 2019, we issued 416,667 ordinary shares representing an exclusive option fee to acquire a portfolio of iron ore tenements. The option was never exercised by the Company; |
• | On September 3, 2020, we issued 15,693,334 listed options pursuant to a pro-rata non-renounceable entitlement issue, with an exercise price of A$0.20 per share and expiring August 31, 2021. As at September 30, 2021, 15,675,824 of these options have been exercised, and 17,510 of these options have lapsed without being exercised; |
• | On December 1, 2020, we issued 25,000,000 ordinary shares as part of a private placement at A$0.08 per share to institutional and sophisticated investors; |
• | On December 1, 2020, we issued 29,150,000 ordinary shares, 5,000,000 unlisted options, 8,000,000 performance options and 39,600,000 performance shares in the Company in relation to the acquisition of the Titan Project; |
• | On January 27 and 29, 2021, we issued 12,150,000 ordinary shares as part of a private placement at A$0.30 per share to institutional and sophisticated investors; |
• | On August 31, 2021, we issued 20,000,000 ordinary shares as part of a private placement at A$1.20 per share to institutional and sophisticated investors; |
• | From time to time since July 1, 2018 through December 31, 2021, we have granted unlisted options to directors, employees, and consultants covering an aggregate of 14,750,000 ordinary shares, with exercise prices ranging from A$0.20 to A$1.33 per share. As at December 31, 2021, 3,126,000 of these options have been exercised; |
• | From time to time since July 1, 2018 through December 31, 2021, we have granted performance rights to directors, employees, and consultants covering an aggregate of 28,315,000 ordinary shares, that each convert into one ordinary share upon the satisfaction of various performance conditions. As at December 31, 2021, 3,000,000 of these performance rights have vested and been converted into ordinary shares. |
• | From time to time since July 1, 2018 through December 31, 2021, we have granted restricted stock units (“RSUs”) to directors covering an aggregate of 600,000 ordinary shares, with a nil exercise price that each convert into one ordinary share upon the satisfaction of various service-based vesting conditions. As at December 31, 2021, none of these RSUs have vested and been converted into ordinary shares and none of these RSUs have lapsed or been forfeited without being exercised. |
• | a special resolution passed by members holding shares in that class; or |
• | the written consent of members who are entitled to at least 75% of the votes that may be cast in respect of shares in that class. |
• | the acquisition of a substantial interest if the Australian corporation is valued in excess of the applicable monetary threshold (see below); |
• | any direct investment by a foreign government investor; |
• | any acquisition of shares in an Australian land corporation; and |
• | any proposed direct investment in a national security business (including starting such a business) or proposed investment in national security land. |
• | a natural person not ordinarily resident in Australia; |
• | a corporation in which a natural person not ordinarily resident in Australia, or a corporation incorporated outside of Australia, holds direct or indirect, actual or potential, voting power of 20% or more; |
• | a corporation in which two or more persons, each of whom is either a non-Australian resident or a non-Australian corporation, hold direct or indirect, actual or potential, voting power in aggregate of 40% or more; |
• | a trustee of a trust estate in which a non-Australian resident or non-Australian corporation holds 20% or more of the corpus or income of the trust estate; |
• | a trustee of a trust estate in which two or more persons, each of whom is either a non-Australian resident or a non-Australian corporation, hold in aggregate 40% or more of the corpus or income of the trust estate; or |
• | a foreign government investor, |
• | the person’s spouse or de facto partner, lineal ancestors and descendants, and siblings; |
• | any partner of the person; |
• | any corporation of which the person is an officer, any officer of a corporation (where the person is a corporation), employers and employees, any employee of a natural person of whom the person is an employee; |
• | any corporation whose directors are accustomed or under an obligation, whether formal or informal, to act in accordance with the directions, instructions or wishes of the person or, where the person is a corporation, of the directors of the person; |
• | any corporation in accordance with the directions, instructions or wishes of which, or of the directors of which, the person is accustomed or under an obligation, whether formal or informal, to act; |
• | any corporation in which the person holds a substantial interest; |
• | where the person is a corporation—a person who holds a substantial interest in the corporation; |
• | the trustee of a trust estate in which the person holds a substantial interest; |
• | where the person is the trustee of a trust estate—a person who holds a substantial interest in the trust estate; |
• | any person who is an associate of any other person who is an associate of the person. |
• | control of 20% or more of the actual or potential voting power or issued shares in a target by a single foreign person (together with associates); or |
• | control of 40% or more of the actual or potential voting power or issued shares in a target by multiple foreign persons (together with associates). |
• | preferential, special or veto voting rights; |
• | the ability to appoint directors or asset managers; |
• | contractual agreements including, but not restricted to, agreements for loans, provision of services and off take agreements; or |
• | building or maintaining a strategic or long-term relationship with a target entity. |
• | a body politic of a foreign country; |
• | entities in which governments, their agencies or related entities from a single foreign country have an aggregate interest (direct or indirect) of 20% or more; |
• | entities in which governments, their agencies or related entities from more than one foreign country have an aggregate interest (direct or indirect) of 40% or more; or |
• | entities that are otherwise controlled by foreign governments, their agencies or related entities, and any associates, or could be controlled by them including as part of a controlling group. |
• | is a responsible entity (within the meaning of the Security of Critical Infrastructure Act 2018 as enacted) for an asset; |
• | is an entity that is a direct interest holder in relation to a critical infrastructure asset (within the meaning of those terms in the Security of Critical Infrastructure Act 2018 as enacted); |
• | is a carrier or nominated carriage service provider to which the Telecommunications Act 1997 applies; |
• | develops, manufacturers or supplies critical goods or critical technology that are, or are intended to be, for a military use, or an intelligence use, by defense and intelligence personnel, the defense force of another country, or a foreign intelligence agency; |
• | provides, or intends to provide, critical services to defense and intelligence personnel, the defense force of another country, or a foreign intelligence agency; |
• | stores or has access to information that has a security classification; |
• | stores or maintains personal information of defense and intelligence personnel collected by the Australian Defence Force, the Defence Department or an agency in the national intelligence community which, if accessed, could compromise Australia’s national security; |
• | collects, as part of an arrangement with the Australian Defence Force, the Defence Department or an agency in the national intelligence community, personal information on defence and intelligence personnel which , if disclosed, could compromise Australia’s national security; or |
• | stores, maintains or has access to personal information on defense and intelligence personnel which , if disclosed, could compromise Australia’s national security. |
• | “Defence” premises within the meaning of section 71A of the Defence Act 1903. This includes all land owned or occupied by Defence, including buildings, structures and Defence prohibited areas. The definition excludes subparagraph (a)(iii) of the definition which relates to vehicles, vessels or aircraft; or |
• | land in which an agency in the national intelligence community has an interest, if the existence of the interest is publicly known or could be known upon the making of reasonable inquiries. |
• | begins to have, or ceases to have, a substantial holding in a listed company; |
• | has a substantial holding in a listed company and there is movement by at least 1 percent in their holding; or |
• | makes a takeover bid for securities of the listed company, |
• | is the holder of the securities; |
• | has power to exercise, or control the exercise of, a right to vote attached to the securities; or |
• | has the power to dispose of, or control the exercise of a power to dispose of, the securities (including any indirect or direct power or control). |
• | has entered or enters into an agreement with another person with respect to the securities; |
• | has given or gives another person an enforceable right, or has been or is given an enforceable right by another person, in relation to the securities; or |
• | has granted or grants an option to, or has been or is granted an option by, another person with respect to the securities, and the other person would have a relevant interest in the securities if the agreement were performed, the right enforced or the option exercised, the other person is taken to already have a relevant interest in the securities. |
• | when the acquisition results from the acceptance of an offer under a formal takeover bid; |
• | when the acquisition is conducted on market by or on behalf of the bidder under a takeover bid and the acquisition occurs during the bid period; |
• | when shareholders of IperionX approve the takeover by resolution passed at general meeting; |
• | an acquisition by a person if, throughout the six months before the acquisition, that person or any other person has had voting power in IperionX of at least 19% and, as a result of the acquisition, none of the relevant persons would have voting power in IperionX more than three percentage points higher than they had six months before the acquisition; |
• | as a result of a rights issue; |
• | as a result of dividend reinvestment schemes; |
• | as a result of underwriting arrangements; |
• | through operation of law; |
• | an acquisition that arises through the acquisition of a relevant interest in another listed company; |
• | arising from an auction of forfeited shares conducted on market; or |
• | arising through a compromise, arrangement, liquidation or buy-back. |
• | insurance companies; |
• | banks or other financial institutions; |
• | individual retirement and other tax-deferred accounts; |
• | regulated investment companies; |
• | real estate investment trusts; |
• | individuals who are former U.S. citizens or former long-term U.S. residents; |
• | brokers, dealers or traders in securities, commodities or currencies; |
• | traders that elect to use a mark-to-market method of accounting; |
• | persons holding our ADSs or ordinary shares through a partnership (including an entity or arrangement treated as a partnership for U.S. federal income tax purposes) or S corporation; |
• | persons that received ADSs or ordinary shares as compensation for the performance of services; |
• | grantor trusts; |
• | tax-exempt entities; |
• | persons that hold ADSs or ordinary shares as a position in a straddle or as part of a hedging, constructive sale, conversion or other integrated transaction for U.S. federal income tax purposes; |
• | persons that have a functional currency other than the U.S. dollar; |
• | persons that own (directly, indirectly or constructively) 10% or more of our equity (by vote or value); or |
• | persons that are not U.S. Holders. |
• | an individual who is a citizen or resident of the United States; |
• | a corporation (or any other entity treated as a corporation for U.S. federal income tax purposes) created or organized in or under the laws of the United States or any state thereof or the District of Columbia; |
• | an estate the income of which is subject to U.S. federal income taxation regardless of its source; or |
• | a trust (i) the administration of which is subject to the primary supervision of a court in the United States and for which one or more U.S. persons have the authority to control all substantial decisions or (ii) that has an election in effect under applicable income tax regulations to be treated as a U.S. person for U.S. federal income tax purposes. |
• | the excess distribution or gain will be allocated ratably over your holding period for the ADSs or ordinary shares; |
• | the amount allocated to the current taxable year, and any taxable year prior to the first taxable year in which we were classified as a PFIC in your holding period, will be treated as ordinary income arising in the current taxable year (and would not be subject to the interest charge discussed below); and |
• | the amount allocated to each other taxable year during your holding period in which we were classified as a PFIC (i) will be subject to income tax at the highest rate in effect for that year and applicable to you and (ii) will be subject to an interest charge generally applicable to underpayments of tax with respect to the resulting tax attributable to each such year. |
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK |
DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES |
• | 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. |
• | 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. |
• | 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 ADS holders, (ii) distribute those rights to ADS holders or (iii) sell those rights and distribute the net proceeds to ADS holders, 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. Or, it may decide to hold what we distributed, in which case ADSs will also represent the newly distributed property. However, the depositary is not required to distribute any securities (other than ADSs) to ADS holders unless it receives satisfactory evidence from us that it is legal to make that distribution. The depositary may sell a portion of the distributed securities or property sufficient to pay its fees and expenses in connection with 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. |
Persons depositing or withdrawing ordinary shares or ADS holders must pay the depositary: | | | For: | |||
| | | | |||
US$5.00 (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 |
| | • | | | Cancellation of ADSs for the purpose of withdrawal, including if the deposit agreement terminates | |
| | | | |||
US$0.05 (or less) per ADS | | | • | | | Any cash distribution to ADS holders |
• | 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 of 1933; |
• | 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. |
• | 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; |
• | have no obligation to become involved in a lawsuit or other proceeding related to the ADSs or the deposit agreement on your behalf or on behalf of any other person; |
• | may rely upon any documents we believe or it believes in good faith to be genuine and to have been signed or presented by the proper 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. |
• | 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. |
• | 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; or |
• | 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. |
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FINANCIAL STATEMENTS | | | |
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FINANCIAL STATEMENTS | | | |
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FINANCIAL STATEMENTS | | | |
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| | Notes | | | 2021 US$ | |
Continuing operations | | | | | ||
Exploration and evaluation expenses | | | | | (2,568,386) | |
Corporate and administrative expenses | | | | | (852,944) | |
Business development expenses | | | | | (581,200) | |
Share-based payment expenses | | | 17(a) | | | (4,084,764) |
Finance income | | | 2 | | | 5,075 |
Finance costs | | | 2 | | | (7,492) |
Cost of listing on reverse acquisition | | | 14 | | | (5,141,126) |
Loss before income tax | | | | | (13,230,837) | |
Income tax expense | | | 3 | | | — |
Loss for the period | | | | | (13,230,837) | |
Loss attributable to members of IperionX Limited | | | | | (13,230,837) | |
| | | | |||
Other comprehensive income/(loss) | | | | | ||
Items that may be reclassified subsequently to profit or loss: | | | | | ||
Exchange differences arising on translation of foreign operations | | | | | (2,419) | |
Other comprehensive loss for the period, net of tax | | | | | (2,419) | |
Total comprehensive loss for the period | | | | | (13,233,256) | |
Total comprehensive loss attributable to members of IperionX Limited | | | | | (13,233,256) | |
| | | | |||
Basic loss per share (US$ per share) | | | 13 | | | (0.22) |
Diluted loss per share (US$ per share) | | | 13 | | | (0.22) |
| | Notes | | | 2021 US$ | |
ASSETS | | | | | ||
Current Assets | | | | | ||
Cash and cash equivalents | | | 5 | | | 1,697,904 |
Trade and other receivables | | | | | 341 | |
Prepayments | | | | | 49,069 | |
Total Current Assets | | | | | 1,747,314 | |
| | | | |||
Non-Current Assets | | | | | ||
Exploration and evaluation assets | | | 6 | | | 504,750 |
Property, plant and equipment | | | 7 | | | 539,619 |
Total Non-Current Assets | | | | | 1,044,369 | |
TOTAL ASSETS | | | | | 2,791,683 | |
| | | | |||
LIABILITIES | | | | | ||
Current Liabilities | | | | | ||
Trade and other payables | | | 8 | | | 544,842 |
Lease liabilities | | | | | 81,104 | |
Provisions | | | | | 11,069 | |
Total Current Liabilities | | | | | 637,015 | |
| | | | |||
Non-Current Liabilities | | | | | ||
Lease liabilities | | | | | 394,548 | |
Total Non-Current Liabilities | | | | | 394,548 | |
TOTAL LIABILITIES | | | | | 1,031,563 | |
| | | | |||
NET ASSETS | | | | | 1,760,120 | |
| | | | |||
EQUITY | | | | | ||
Contributed equity | | | 10 | | | 10,255,369 |
Reserves | | | 11 | | | 4,735,588 |
Accumulated losses | | | 12 | | | (13,230,837) |
TOTAL EQUITY | | | | | 1,760,120 |
| | Contributed Equity US$ | | | Share-Based Payments Reserve US$ | | | Foreign Currency Translation Reserve US$ | | | Accumulated Losses US$ | | | Total Equity US$ | |
Balance at incorporation | | | — | | | — | | | — | | | — | | | — |
Net loss for the period | | | — | | | — | | | — | | | (13,230,837) | | | (13,230,837) |
Exchange differences arising on translation of foreign operations | | | — | | | — | | | (2,419) | | | — | | | (2,419) |
Total comprehensive loss for the period | | | — | | | — | | | (2,419) | | | (13,230,837) | | | (13,233,256) |
Issue of shares – incorporation | | | 1 | | | — | | | — | | | — | | | 1 |
Issue of shares – seed placement | | | 54,011 | | | — | | | — | | | — | | | 54,011 |
Reverse acquisition | | | 6,433,752 | | | 967,582 | | | — | | | — | | | 7,401,334 |
Issue of shares – share placement | | | 2,819,340 | | | — | | | — | | | — | | | 2,819,340 |
Issue of shares – exercise of options and performance rights | | | 1,033,732 | | | (314,339) | | | — | | | — | | | 719,393 |
Share issue costs | | | (85,467) | | | — | | | — | | | — | | | (85,467) |
Share-based payment expense | | | — | | | 4,084,764 | | | — | | | — | | | 4,084,764 |
Balance at June 30, 2021 | | | 10,255,369 | | | 4,738,007 | | | (2,419) | | | (13,230,837) | | | 1,760,120 |
| | Notes | | | 2021 US$ | |
Operating activities | | | | | ||
Payments to suppliers and employees | | | | | (3,562,589) | |
Interest paid | | | | | (511) | |
Interest received | | | | | 5,075 | |
Net cash flows used in operating activities | | | 5 | | | (3,558,025) |
| | | | |||
Investing activities | | | | | ||
Purchase of exploration and evaluation assets | | | 6 | | | (504,750) |
Purchase of property, plant and equipment | | | | | (66,818) | |
Net cash flows from investing activities | | | | | (571,568) | |
| | | | |||
Financing activities | | | | | ||
Proceeds from issue of shares | | | | | 3,592,745 | |
Share issue costs | | | 10(a) | | | (85,467) |
Payment of principal portion of lease liabilities | | | | | (6,473) | |
Net cash inflow on reverse acquisition | | | 14 | | | 2,329,111 |
Net cash flows from financing activities | | | | | 5,829,916 | |
| | | | |||
Net increase in cash and cash equivalents | | | | | 1,700,323 | |
Net foreign exchange differences | | | | | (2,419) | |
Cash and cash equivalents at beginning of period | | | | | — | |
Cash and cash equivalents at the end of the period | | | 5 | | | 1,697,904 |
1. | STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES |
(a) | Basis of preparation |
(b) | New standards, interpretations and amendments |
• | Definition of a Business (Amendments to IFRS 3) |
• | Definition of Material (Amendments to IAS 1 and IAS 8) |
• | Amendments to References to the Conceptual Framework in IFRS Standards |
(c) | Issued standards and interpretations not early adopted |
Standard/Interpretation | | | Application Date of Standard | | | Application Date for the Group |
Annual Improvements to IFRS Standards 2018–2020 | | | January 1, 2022 | | | July 1, 2022 |
Classification of Liabilities as Current or Non-Current (Amendments to IAS 1) | | | January 1, 2023 | | | July 1, 2023 |
Classification of Liabilities as Current or Non-current — Deferral of Effective Date (Amendment to IAS 1) | | | January 1, 2023 | | | July 1, 2023 |
(d) | Principles of Consolidation |
(e) | Foreign Currencies |
(i) | Functional and presentation currency |
(ii) | Transactions and balances |
(iii) | Group companies |
• | assets and liabilities are translated at period-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. |
(f) | Cash and Cash Equivalents |
(g) | Trade and Other Receivables |
(h) | Property, Plant and Equipment |
(i) | Exploration and Development Expenditure |
(i) | the rights to tenure of the area of interest are current; and |
(ii) | at least one of the following conditions is also met: |
• | the exploration and evaluation expenditures are expected to be recouped through successful development and exploitation of the area of interest, or alternatively, by its sale; and |
• | exploration and evaluation activities in the area of interest have not at the reporting date reached a stage which permits a reasonable assessment of the existence or otherwise of economically recoverable reserves, and active and significant operations in, or in relation to, the area of interest are continuing. |
(j) | Trade and other payables |
(k) | Provisions |
(l) | Interest income |
(m) | Income Tax |
(n) | Employee Entitlements |
(o) | Earnings per Share |
(p) | Goods and Services Tax |
(q) | Use and Revision of Accounting Estimates, Judgements and Assumptions |
• | Recognition of tax losses (Notes 1(m) and 3); |
• | Impairment of exploration and evaluation assets (Note 6); |
• | Determination of the accounting acquirer in reverse acquisition and fair value of the consideration paid (Note 14); and |
• | Share-based payments (Note 17). |
(r) | Operating Segments |
• | Nature of the products and services, |
• | Nature of the production processes, |
• | Type or class of customer for the products and services, |
• | Methods used to distribute the products or provide the services, and if applicable, |
• | Nature of the regulatory environment. |
(s) | Impairment of Assets |
(t) | Fair Value Estimation |
(u) | Issued and Unissued Capital |
(v) | Dividends |
(w) | Share-Based Payments |
(x) | Revisions |
2. | INCOME AND EXPENSES |
| | Note | | | 2021 US$ | |
Employee benefits expense | | | | | ||
Wages and salaries | | | | | (509,474) | |
Employee benefits | | | | | (44,325) | |
Post-employment benefits | | | | | (8,929) | |
Share-based payment expenses | | | | | (4,084,764) | |
| | | | (4,647,492) |
3. | INCOME TAX |
| | 2021 US$ | |
Recognised in profit or loss | | | |
Current income tax: | | | |
Current income tax benefit in respect of the current period | | | — |
Deferred income tax: | | | |
Origination and reversal of temporary differences | | | — |
Income tax expense reported in profit or loss | | | — |
| | ||
Reconciliation between tax expense and accounting loss before income tax | | | |
Accounting loss before income tax | | | (13,230,837) |
At the Australian income tax rate of 30% | | | (3,969,251) |
Effect of lower income tax rate in the United States | | | 124,391 |
Expenditure not allowable for income tax purposes | | | 2,942,127 |
Exchange differences | | | (5,365) |
Effect of deferred tax assets not brought to account | | | 908,098 |
Income tax expense reported in profit or loss | | | — |
| | ||
Deferred tax assets and liabilities | | | |
Deferred tax liabilities: | | | |
Right-of-use assets | | | 142,128 |
Deferred tax assets used to offset deferred tax liabilities | | | (142,128) |
| | — | |
Deferred tax assets: | | | |
Accrued expenditures | | | 53,997 |
Provisions | | | 2,893 |
Lease liabilities | | | 142,695 |
Tax losses available to offset against future taxable income | | | 1,260,669 |
Deferred tax assets used to offset deferred tax liabilities | | | (142,128) |
Deferred tax assets acquired on reverse acquisition not brought to account (1) | | | (410,028) |
Other deferred tax assets not brought to account (1) | | | (908,098) |
| | — |
(1) | The benefit of deferred tax assets not brought to account will only be brought to account if: (a) future assessable income is derived of a nature and of an amount sufficient to enable the benefit to be realised; (b) the conditions for deductibility imposed by tax legislation continue to be complied with; and (c) no changes in tax legislation adversely affect the Group in realising the benefit. |
4. | DIVIDENDS PAID OR PROVIDED FOR ON ORDINARY SHARES |
5. | CASH AND CASH EQUIVALENTS |
| | 2021 US$ | |
Cash at bank and on hand | | | 1,697,904 |
| | 1,697,904 | |
| | ||
Reconciliation of loss before income tax to net cash flows from operations | | | |
Loss for the period | | | (13,230,837) |
Adjustment for non-cash income and expense items | | | |
Share-based payments expense | | | 4,084,764 |
Cost of listing on reverse acquisition | | | 5,141,126 |
Amortisation of right-of-use assets | | | 8,364 |
Depreciation of property, plant and equipment | | | 960 |
Changes in assets and liabilities | | | |
Increase in receivables and prepayments | | | (34,405) |
Increase in payables and provisions | | | 472,003 |
Net cash outflow from operating activities | | | (3,558,025) |
6. | EXPLORATION AND EVALUATION ASSETS |
| | Titan Project(1) US$ | |
2021 | | | |
Carrying amount at incorporation | | | — |
Additions | | | 504,750 |
Carrying amount at June 30, 2021(2) | | | 504,750 |
(1) | At June 30, 2021, the Titan Project comprised of approximately 6,111 acres of surface and associated mineral rights in Tennessee prospective for heavy mineral sands, including titanium, rare earth minerals, high grade silica sand, and zircon, of which approximately 137 acres are owned and approximately 5,974 acres are subject to exclusive option agreements. These exclusive option agreements, upon exercise, allow the Group to purchase or, in some cases lease, the surface property and associated mineral rights. |
(2) | The ultimate recoupment of costs carried forward for exploration and evaluation is dependent on the successful development and commercial exploitation or sale of the respective areas of interest. |
7. | PROPERTY, PLANT AND EQUIPMENT |
| | Plant and equipment US$ | | | Right-of-use assets US$ | | | Total US$ | |
2021 | | | | | | | |||
Carrying amount at incorporation | | | — | | | — | | | — |
Additions | | | 66,818 | | | 482,125 | | | 548,943 |
Depreciation and amortization | | | (960) | | | (8,364) | | | (9,324) |
Carrying amount at June 30, 2021 | | | 65,858 | | | 473,761 | | | 539,619 |
- at cost | | | 66,818 | | | 482,125 | | | 548,943 |
- accumulated depreciation | | | (960) | | | (8,364) | | | (9,324) |
8. | TRADE AND OTHER PAYABLES |
| | 2021 US$ | |
Current | | | |
Trade payables | | | 286,846 |
Accruals | | | 255,965 |
Payroll liabilities | | | 2,031 |
Total trade and other payables | | | 544,842 |
9. | LEASES |
| | Note | | | 2021 US$ | |
Amortisation of right-of-use assets | | | 2 | | | (8,364) |
Interest expense on lease liabilities | | | 2 | | | (3,097) |
Net amount recognised in profit or loss | | | | | (11,461) |
10. | CONTRIBUTED EQUITY |
| | Note | | | 2021 US$ | |
Issued capital | | | | | ||
105,105,787 fully paid ordinary shares | | | 10(a) | | | 10,255,369 |
(a) | Movements in issued capital |
| | Number of Ordinary Shares | | | Number of Class A Performance Shares | | | Number of Class B Performance Shares | | | US$ | |
2021 | | | | | | | | | ||||
Opening balance at incorporation | | | — | | | — | | | — | | | — |
Issue of shares – incorporation (July 2020) | | | 1 | | | — | | | — | | | 1 |
Issue of shares – seed placement (August-October 2020) | | | 99,999 | | | — | | | — | | | 54,011 |
Reverse acquisition – exchange of ordinary shares of HMAPL for ordinary shares and performance shares of IperionX, adjusted to reflect the exchange ratio set forth in the merger agreement | | | 26,400,000 | | | 18,000,000 | | | 18,000,000 | | | — |
Reverse acquisition – shares issued to facilitators of reverse acquisition | | | 2,650,000 | | | 1,800,000 | | | 1,800,000 | | | — |
Reverse acquisition – recognition of legal acquirer shares | | | 57,386,667 | | | — | | | — | | | 6,433,752 |
Issue of shares – share placement (January 2021) | | | 12,150,000 | | | — | | | — | | | 2,819,340 |
Issue of shares – exercise of options and performance rights | | | 6,419,120 | | | — | | | — | | | 1,033,732 |
Share issue costs | | | — | | | — | | | — | | | (85,467) |
Closing balance at June 30, 2021 | | | 105,105,787 | | | 19,800,000 | | | 19,800,000 | | | 10,255,369 |
(b) | Rights attaching to Ordinary Shares |
(i) | Shares - The issue of shares in the capital of the Company and options over unissued shares by the Company is under the control of the directors, subject to the Corporations Act 2001, ASX Listing Rules and any rights attached to any special class of shares. |
(ii) | Meetings of Members - Directors may call a meeting of members whenever they think fit. Members may call a meeting as provided by the Corporations Act 2001.The Constitution contains provisions prescribing the content requirements of notices of meetings of members and all members are entitled to a notice of meeting. A meeting may be held in two or more places linked together by audio-visual communication devices. A quorum for a meeting of members is 2 shareholders. The Company holds annual general meetings in accordance with the Corporations Act 2001 and the Listing Rules. |
(iii) | Voting - Subject to any rights or restrictions at the time being attached to any shares or class of shares of the Company, each member of the Company is entitled to receive notice of, attend and vote at a general meeting. Resolutions of members will be decided by a show of hands unless a poll is demanded. On a show of hands each eligible voter present has one vote. However, where a person present at a general meeting represents personally or by proxy, attorney or representative more than one member, on a show of hands the person is entitled to one vote only despite the number of members the person represents. On a poll each eligible member has one vote for each fully paid share held and a fraction of a vote for each partly paid share determined by the amount paid up on that share. |
(iv) | Changes to the Constitution - The Company's Constitution can only be amended by a special resolution passed by at least three quarters of the members present and voting at a general meeting of the Company. At least 28 days' written notice specifying the intention to propose the resolution as a special resolution must be given. |
(v) | Listing Rules - Provided the Company remains admitted to the Official List, then despite anything in its Constitution, no act may be done that is prohibited by the Listing Rules, and authority is given for acts required to be done by the Listing Rules. The Company's Constitution will be deemed to comply with the Listing Rules as amended from time to time. |
(c) | Rights attaching to Performance Shares |
• | The Performance Shareholders are not entitled to a dividend; |
• | The Performance Shares are not transferable; |
• | The Performance Shareholders shall have no right to vote, subject to the Corporations Act; |
• | The Performance Shares will convert into Ordinary Shares as follows: |
○ | Each Class A Performance Share will convert into one (1) Ordinary Share upon completion of a positive pre-feasibility study (prepared in accordance with the JORC Code and independently verified by a Competent Person) for heavy mineral sands mining and processing on any of the Titan Project area which demonstrates a net present value of at least A$200,000,000 before September 17, 2024 (the “Pre-Feasibility Study Milestone”); |
○ | Each Class B Performance Share will convert into one (1) Ordinary Share upon the commencement of commercial production from the Titan Project area before September 17, 2025 (the “First Production Milestone”); |
○ | All Performance Shares shall automatically convert into Ordinary Shares upon the occurrence of certain change of control events; and |
○ | To the extent that any Performance Shares have not converted into Ordinary Shares by the applicable expiry date, all such Performance Shares for each holder will automatically lapse be combined into one single Performance Share that will then convert into one single Ordinary Share. |
• | The Ordinary Shares issued on conversion of any Performance Share will rank equally with and confer rights identical with all other Ordinary Shares then on issue and application will be made by the Company to ASX for official quotation of the Ordinary Shares upon the date of conversion. |
• | The Company shall allot and issue Ordinary Shares immediately upon conversion of the Performance Shares for no consideration and shall record the allotment and issue in the manner required by the Corporations Act. |
• | The Performance Shares are unquoted. No application for quotation of the Performance Shares will be made by the Company. |
11. | RESERVES |
| | Note | | | 2021 US$ | |
Share-based payments reserve | | | 11(b) | | | 4,738,007 |
Foreign currency translation reserve | | | 11(f) | | | (2,419) |
| | | | 4,735,588 |
(a) | Nature and purpose of reserves |
(i) | Share-based payments reserve |
(ii) | Foreign currency translation reserve |
(b) | Movements in share-based payments reserve during the period |
| | Number of Listed Options (Note 11(c)) | | | Number of Unlisted Options (Note 11(d)) | | | Number of Performance Rights (Note 11(e)) | | | US$ | |
2021 | | | | | | | | | ||||
Opening balance at incorporation | | | — | | | — | | | — | | | — |
Reverse acquisition – options issued to vendors of legal acquiree | | | — | | | 13,000,000 | | | — | | | — |
Reverse acquisition – recognition of legal acquirer options and rights | | | 15,693,334 | | | 5,000,000 | | | 2,000,000 | | | 967,582 |
Issue of employee options and performance rights | | | — | | | 9,150,000 | | | 16,325,000(2) | | | — |
Exercise of options and performance rights | | | (3,069,120) | | | (1,350,000) | | | (2,000,000) | | | (314,339) |
Share-based payment expense | | | — | | | — | | | — | | | 4,084,764 |
Closing balance at June 30, 2021 | | | 12,624,214 | | | 25,800,000 | | | 16,325,000 | | | 4,738,007 |
(1) | For details on the valuation of Unlisted Options and Performance Rights, including models and assumptions used, refer to Note 17 of the financial statements. |
(2) | During the period, the Group agreed, subject to shareholder approval, to grant 3,500,000 performance rights to Mr. Hannigan. These performance rights have not been included in this table as they had not been granted at June 30, 2021. |
(c) | Terms and conditions of Listed Options |
• | Each Listed Option entitles the holder to the right to subscribe for one Share upon the exercise of each Listed Option; |
• | The Listed Options outstanding at the end of the financial period have the following exercise prices and expiry dates: |
○ | 12,624,214 Listed Options exercisable at A$0.20 each on or before August 31, 2021; |
• | The Listed Options are exercisable at any time prior to the Expiry Date; |
• | Shares issued on exercise of the Listed Options rank equally with the then Shares of the Company; |
• | Application will be made by the Company to ASX for official quotation of the Shares issued upon the exercise of the Listed Options; |
• | If there is any reconstruction of the issued share capital of the Company, the rights of the Listed Options holders may be varied to comply with the ASX Listing Rules which apply to the reconstruction at the time of the reconstruction; and |
• | The Listed Options are quoted on ASX (ASX code: HYMOA). |
(d) | Terms and conditions of Unlisted Options |
• | Each Unlisted Option entitles the holder to the right to subscribe for one Share upon the exercise of each Unlisted Option; |
• | The Unlisted Options outstanding at the end of the financial period have the following exercise prices and expiry dates: |
○ | 6,000,000 Unlisted Options exercisable at A$0.25 each on or before December 31, 2023; |
○ | 4,650,000 Unlisted Options exercisable at A$0.20 each on or before December 31, 2023; |
○ | 5,000,000 Unlisted Options exercisable at A$0.20 each on or before December 1, 2025; |
○ | 4,000,000 Class A Performance Unlisted Options exercisable at A$0.20 each on or before December 1, 2025; |
○ | 4,000,000 Class B Performance Unlisted Options exercisable at A$0.20 each on or before December 1, 2025; |
○ | 1,075,000 Unlisted Options exercisable at A$0.45 each on or before December 31, 2023; and |
○ | 1,075,000 Unlisted Options exercisable at A$0.55 each on or before December 31, 2023. |
• | The Unlisted Options are exercisable at any time prior to the Expiry Date, subject to vesting conditions being satisfied (if applicable); |
• | Shares issued on exercise of the Unlisted Options rank equally with the then Shares of the Company; |
• | Application will be made by the Company to ASX for official quotation of the Shares issued upon the exercise of the Unlisted Options; |
• | If there is any reconstruction of the issued share capital of the Company, the rights of the Unlisted Option holders may be varied to comply with the ASX Listing Rules which apply to the reconstruction at the time of the reconstruction; and |
• | No application for quotation of the Unlisted Options will be made by the Company. |
(e) | Terms and conditions of Performance Rights |
• | Each Performance Right automatically converts into one Share upon vesting of the Performance Right; |
• | Each Performance Right is subject to performance conditions (as determined by the Board from time to time) which must be satisfied in order for the Performance Right to vest; |
• | The Performance Rights outstanding at the end of the financial period have the following performance conditions and expiry dates: |
○ | 5,133,333 performance rights that vest upon a 30-day VWAP of A$2.00 per share, expiring April 23, 2026; |
○ | 5,133,333 performance rights that vest upon a 30-day VWAP of A$3.00 per share, expiring April 23, 2026; |
○ | 5,233,334 performance rights that vest upon a 30-day VWAP of A$4.00 per share, expiring April 23, 2026; |
○ | 125,000 performance rights that vest upon a 30-day VWAP of A$2.00 per share, expiring April 23, 2024; |
○ | 125,000 performance rights that vest upon a 30-day VWAP of A$3.00 per share, expiring April 23, 2024; |
○ | 125,000 performance rights that vest upon a 30-day VWAP of A$4.00 per share, expiring April 23, 2024; |
○ | 150,000 performance rights that vest upon a 30-day VWAP of A$2.00 per share, expiring March 1, 2026; |
○ | 150,000 performance rights that vest upon a 30-day VWAP of A$3.00 per share, expiring March 1, 2026; and |
○ | 150,000 performance rights that vest upon achieving a 30-day VWAP of A$4.00 per share, expiring March 1, 2026; |
• | Application will be made by the Company to ASX for official quotation of the Shares issued upon conversion of the Performance Rights; |
• | If there is any reconstruction of the issued share capital of the Company, the rights of the Performance Right holders may be varied to comply with the ASX Listing Rules which apply to the reconstruction at the time of the reconstruction; |
• | No application for quotation of the Performance Rights will be made by the Company; and |
• | Without approval of the Board, Performance Rights may not be transferred, assigned or novated, except, upon death, a participant's legal personal representative may elect to be registered as the new holder of such Performance Rights and exercise any rights in respect of them. |
(f) | Movements in foreign currency translation reserve during the period |
| | 2021 US$ | |
Balance at incorporation | | | — |
Exchange differences arising on translation of foreign operations | | | (2,419) |
Balance at June 30 | | | (2,419) |
12. | ACCUMULATED LOSSES |
| | 2021 US$ | |
Balance at incorporation | | | — |
Net loss for the period | | | (13,230,837) |
Balance at June 30 | | | (13,230,837) |
13. | LOSS PER SHARE |
| | 2021 US$ | |
Basic loss per share | | | (0.22) |
Diluted loss per share | | | (0.22) |
| | 2021 US$ | |
Net loss | | | (13,230,837) |
Loss used in calculating basic and dilutive loss per share | | | (13,230,837) |
| | Number of Ordinary Shares 2021 | |
Weighted average number of Ordinary Shares used in calculating basic and dilutive loss per share | | | 60,336,252 |
(a) | Non-Dilutive Securities |
(b) | Conversions, Calls, Subscriptions or Issues after June 30, 2021 |
(i) | 20,000,000 ordinary shares pursuant to a share placement to institutional, sophisticated and professional investors; |
(ii) | 12,606,704 ordinary shares pursuant to the exercise of listed options; |
(iii) | 1,400,000 ordinary shares pursuant to the exercise of unlisted options; |
(iv) | 600,000 restricted stock units to new Directors of the Company; and |
(v) | 600,000 unlisted options to new Directors of the Company. |
14. | REVERSE ACQUISITION ACCOUNTING |
(1) | The fair value of the equity interests deemed to have been issued by HMAPL has been determined based on the underlying share price of the Company on ASX on the deemed date of acquisition (A$0.26 per share on December 1, 2020), adjusted by the fair value of share-based contingent consideration deemed to have been issued to the existing equity holders of the Company and the fair value of share-based contingent consideration issued to the equity holders of HMAPL, resulting in a deemed value of consideration of US$7,401,334, of which US$6,433,752 has been allocated to issued share capital (i.e. ordinary shares and performance shares) and US$967,582 has been allocated to share-based contingent consideration (i.e. listed options, unlisted options, and unlisted performance rights). Note 17 sets out the key assumptions adopted in the valuation of the unlisted options (Series 2-5) included as contingent consideration. In addition, a probability adjustment has been applied to the valuation of the performance shares and performance options included as contingent consideration reflecting the likelihood that the non-market performance conditions associated with them will vest (80% likelihood that the Pre-Feasibility Study Milestone will be achieved and a 20% likelihood that the First Production Milestone will be achieved). |
15. | RELATED PARTIES |
(a) | Subsidiaries |
| | Country of Incorporation | | | Equity Interest 2021 % | |
Hyperion Metals (Australia) Pty Ltd | | | Australia | | | 100 |
TN Exploration LLC | | | United States | | | 100 |
Hyperion Materials & Technologies LLC | | | United States | | | 100 |
Calatos Pty Ltd LLC | | | United States | | | 100 |
(b) | Ultimate Parent |
(c) | Key Management Personnel |
| | 2021 US$ | |
Short-term employee benefits | | | 275,246 |
Post-employment benefits | | | 6,079 |
Share-based payments | | | 3,681,159 |
Total compensation | | | 3,962,484 |
(d) | Other transactions with Related Parties |
16. | PARENT ENTITY DISCLOSURES |
| | 2021 US$ | | | 2020 US$ | |
Equity | | | | | ||
Contributed equity | | | 13,360,608 | | | 3,372,855 |
Reserves | | | 5,723,616 | | | 845,282 |
Accumulated losses | | | (17,324,104) | | | (2,154,572) |
Total Equity | | | 1,760,120 | | | 2,063,565 |
| | | | |||
(b) Financial Performance | | | | | ||
Loss for the period | | | (15,169,532) | | | (549,740) |
Other comprehensive income | | | 96,762 | | | — |
Total comprehensive loss | | | (15,072,770) | | | (549,740) |
(c) | Other |
17. | SHARE-BASED PAYMENTS |
(a) | Recognised share-based payment expense |
(b) | Summary of securities granted as share-based payments |
| | 2021 Number | | | 2021 WAEP | |
Outstanding at beginning of period | | | — | | | — |
Recognition of legal acquirer Listed Options on reverse acquisition | | | 15,693,334 | | | A$0.20 |
Recognition of legal acquirer Unlisted Options on reverse acquisition | | | 5,000,000 | | | A$0.20 |
Recognition of legal acquirer Performance Rights on reverse acquisition | | | 2,000,000 | | | — |
Unlisted Options granted to vendors of legal acquiree on reverse acquisition | | | 13,000,000 | | | A$0.20 |
Unlisted Options granted during the period | | | 9,150,000 | | | A$0.31 |
Performance Rights granted during the period | | | 16,325,000 | | | — |
Listed Options exercised during the period | | | (3,069,120) | | | (A$0.20) |
Unlisted Options exercised during the period | | | (1,350,000) | | | (A$0.24) |
Performance Rights converted during the period | | | (2,000,000) | | | — |
Outstanding at end of period | | | 54,749,214 | | | A$0.19 |
2021 | | | Security Type | | | Number | | | Grant Date | | | Expiry Date | | | Exercise Price A$ | | | Vesting Hurdle (30-day VWAP) A$ | | | Fair Value A$ |
Series 1 | | | Options | | | 7,000,000 | | | 01-Dec-20 | | | 31-Dec-23 | | | $0.25 | | | — | | | $0.163 |
Series 2 | | | Options | | | 5,000,000 | | | 01-Dec-20 | | | 01-Dec-25 | | | $0.20 | | | — | | | $0.201 |
Series 3 | | | Options | | | 4,000,000 | | | 01-Dec-20 | | | 01-Dec-25 | | | $0.20 | | | — | | | $0.201 |
Series 4 | | | Options | | | 4,000,000 | | | 01-Dec-20 | | | 01-Dec-25 | | | $0.20 | | | — | | | $0.201 |
Series 5 | | | Options | | | 5,000,000 | | | 01-Dec-20 | | | 31-Dec-23 | | | $0.20 | | | — | | | $0.174 |
Series 6 | | | Rights | | | 150,000 | | | 03-Mar-21 | | | 01-Mar-26 | | | — | | | $2.00 | | | $0.694 |
Series 7 | | | Rights | | | 150,000 | | | 03-Mar-21 | | | 01-Mar-26 | | | — | | | $3.00 | | | $0.643 |
Series 8 | | | Rights | | | 150,000 | | | 03-Mar-21 | | | 01-Mar-26 | | | — | | | $4.00 | | | $0.602 |
Series 9 | | | Rights | | | 2,000,000 | | | 14-Apr-21 | | | 23-Apr-26 | | | — | | | $2.00 | | | $0.745 |
Series 10 | | | Rights | | | 2,000,000 | | | 14-Apr-21 | | | 23-Apr-26 | | | — | | | $3.00 | | | $0.693 |
Series 11 | | | Rights | | | 2,000,000 | | | 14-Apr-21 | | | 23-Apr-26 | | | — | | | $4.00 | | | $0.651 |
Series 12 | | | Options | | | 875,000 | | | 14-Apr-21 | | | 31-Dec-23 | | | $0.45 | | | — | | | $0.605 |
Series 13 | | | Options | | | 875,000 | | | 14-Apr-21 | | | 31-Dec-23 | | | $0.55 | | | — | | | $0.575 |
Series 14 | | | Rights | | | 125,000 | | | 15-Apr-21 | | | 23-Apr-24 | | | — | | | $2.00 | | | $0.599 |
Series 15 | | | Rights | | | 125,000 | | | 15-Apr-21 | | | 23-Apr-24 | | | — | | | $3.00 | | | $0.510 |
Series 16 | | | Rights | | | 125,000 | | | 15-Apr-21 | | | 23-Apr-24 | | | — | | | $4.00 | | | $0.445 |
Series 17 | | | Rights | | | 2,875,000 | | | 15-Apr-21 | | | 23-Apr-26 | | | — | | | $2.00 | | | $0.705 |
Series 18 | | | Rights | | | 2,875,000 | | | 15-Apr-21 | | | 23-Apr-26 | | | — | | | $3.00 | | | $0.654 |
Series 19 | | | Rights | | | 2,975,000 | | | 15-Apr-21 | | | 23-Apr-26 | | | — | | | $4.00 | | | $0.613 |
Series 20 | | | Options | | | 200,000 | | | 15-Apr-21 | | | 31-Dec-23 | | | $0.45 | | | — | | | $0.570 |
Series 21 | | | Options | | | 200,000 | | | 15-Apr-21 | | | 31-Dec-23 | | | $0.55 | | | — | | | $0.540 |
Series 22 | | | Rights | | | 258,333 | | | 22-Jun-21 | | | 23-Apr-26 | | | — | | | $2.00 | | | $0.821 |
Series 23 | | | Rights | | | 258,333 | | | 22-Jun-21 | | | 23-Apr-26 | | | — | | | $3.00 | | | $0.763 |
Series 24 | | | Rights | | | 258,334 | | | 22-Jun-21 | | | 23-Apr-26 | | | — | | | $4.00 | | | $0.716 |
(c) | Weighted Average Remaining Contractual Life |
(d) | Weighted Average Fair Value |
(e) | Range of Exercise Prices |
(f) | Weighted Average Share Price of Exercised Options |
(g) | Option and Right Pricing Models |
2021 | | | Series 1 | | | Series 2 | | | Series 3 | | | Series 4 | | | Series 5 | | | Series 6 |
Fair value at grant date | | | A$0.163 | | | A$0.201 | | | A$0.201 | | | A$0.201 | | | A$0.174 | | | A$0.694 |
Share price at grant date | | | A$0.26 | | | A$0.26 | | | A$0.26 | | | A$0.26 | | | A$0.26 | | | A$0.800 |
Vesting hurdle (30-day VWAP) | | | N/A | | | N/A | | | N/A | | | N/A | | | N/A | | | A$2.00 |
Exercise price | | | A$0.25 | | | A$0.20 | | | A$0.20 | | | A$0.20 | | | A$0.20 | | | Nil |
Expected life of options/rights1 | | | 3.08 years | | | 5.00 years | | | 5.00 years | | | 5.00 years | | | 3.10 years | | | 5.00 years |
Risk-free interest rate | | | 0.10% | | | 0.26% | | | 0.26% | | | 0.26% | | | 0.10% | | | 0.700% |
Expected volatility2 | | | 100% | | | 100% | | | 100% | | | 100% | | | 100% | | | 100% |
Expected dividend yield3 | | | — | | | — | | | — | | | — | | | — | | | — |
2021 | | | Series 7 | | | Series 8 | | | Series 9 | | | Series 10 | | | Series 11 | | | Series 12 |
Fair value at grant date | | | A$0.643 | | | A$0.602 | | | A$0.745 | | | A$0.693 | | | A$0.651 | | | A$0.605 |
Share price at grant date | | | A$0.800 | | | A$0.800 | | | A$0.850 | | | A$0.850 | | | A$0.850 | | | A$0.850 |
Vesting hurdle (30-day VWAP) | | | A$3.00 | | | A$4.00 | | | A$2.00 | | | A$3.00 | | | A$4.00 | | | N/A |
Exercise price | | | Nil | | | Nil | | | Nil | | | Nil | | | Nil | | | A$0.450 |
Expected life of options/rights1 | | | 5.00 years | | | 5.00 years | | | 5.03 years | | | 5.03 years | | | 5.03 years | | | 2.72 years |
Risk-free interest rate | | | 0.700% | | | 0.700% | | | 0.680% | | | 0.680% | | | 0.680% | | | 0.105% |
Expected volatility2 | | | 100% | | | 100% | | | 100% | | | 100% | | | 100% | | | 100% |
Expected dividend yield3 | | | — | | | — | | | — | | | — | | | — | | | — |
2021 | | | Series 13 | | | Series 14 | | | Series 15 | | | Series 16 | | | Series 17 | | | Series 18 |
Fair value at grant date | | | A$0.575 | | | A$0.599 | | | A$0.510 | | | A$0.445 | | | A$0.705 | | | A$0.654 |
Share price at grant date | | | A$0.850 | | | A$0.810 | | | A$0.810 | | | A$0.810 | | | A$0.810 | | | A$0.810 |
Vesting hurdle (30-day VWAP) | | | N/A | | | A$2.00 | | | A$3.00 | | | A$4.00 | | | A$2.00 | | | A$3.00 |
Exercise price | | | A$0.550 | | | Nil | | | Nil | | | Nil | | | Nil | | | Nil |
Expected life of options/rights1 | | | 2.72 years | | | 3.02 years | | | 3.02 years | | | 3.02 years | | | 5.02 years | | | 5.02 years |
Risk-free interest rate | | | 0.105% | | | 0.105% | | | 0.105% | | | 0.105% | | | 0.690% | | | 0.690% |
Expected volatility2 | | | 100% | | | 100% | | | 100% | | | 100% | | | 100% | | | 100% |
Expected dividend yield3 | | | — | | | — | | | — | | | — | | | — | | | — |
2021 | | | Series 19 | | | Series 20 | | | Series 21 | | | Series 22 | | | Series 23 | | | Series 24 |
Fair value at grant date | | | A$0.613 | | | A$0.570 | | | A$0.540 | | | A$0.821 | | | A$0.763 | | | A$0.716 |
Share price at grant date | | | A$0.810 | | | A$0.810 | | | A$0.810 | | | A$0.930 | | | A$0.930 | | | A$0.930 |
Vesting hurdle (30-day VWAP) | | | A$4.00 | | | N/A | | | N/A | | | A$2.00 | | | A$3.00 | | | A$4.00 |
Exercise price | | | Nil | | | A$0.450 | | | A$0.550 | | | Nil | | | Nil | | | Nil |
Expected life of options/rights1 | | | 5.02 years | | | 2.71 years | | | 2.71 years | | | 4.84 years | | | 4.84 years | | | 4.84 years |
Risk-free interest rate | | | 0.690% | | | 0.105% | | | 0.105% | | | 0.820% | | | 0.820% | | | 0.820% |
Expected volatility2 | | | 100% | | | 100% | | | 100% | | | 100% | | | 100% | | | 100% |
Expected dividend yield3 | | | — | | | — | | | — | | | — | | | — | | | — |
(1) | The expected life is based on the expiry date of the options or rights. |
(2) | The expected volatility reflects the assumption that the historical volatility is indicative of future trends, which may not necessarily be the actual outcome. |
(3) | The dividend yield reflects the assumption that the current dividend payout will remain unchanged. |
18. | SEGMENT INFORMATION |
(a) | Reconciliation of non-current assets by geographical location |
| | 2021 US$ | |
United States of America | | | 1,044,369 |
| | 1,044,369 |
19. | FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES |
(a) | Overview |
(b) | Credit Risk |
| | Note | | | 2021 US$ | |
Cash and cash equivalents | | | 5 | | | 1,697,904 |
Trade and other receivables | | | | | 341 | |
| | | | 1,698,245 |
(c) | Liquidity Risk |
| | ≤1 year US$ | | | 1-5 years US$ | | | ≥5 years US$ | | | Total contractual cash flows US$ | | | Carrying amount of liabilities US$ | |
2021 | | | | | | | | | | | |||||
Financial liabilities | | | | | | | | | | | |||||
Trade and other payables | | | 544,842 | | | — | | | — | | | 544,842 | | | 544,842 |
Lease liabilities | | | 115,067 | | | 461,903 | | | — | | | 576,970 | | | 475,652 |
| | 659,909 | | | 461,903 | | | — | | | 1,121,812 | | | 1,020,494 |
(d) | Interest Rate Risk |
| | Note | | | 2021 US$ | |
Interest-bearing financial instruments | | | | | ||
Cash at bank and on hand | | | 5 | | | 1,697,904 |
Short term deposits | | | | | — | |
| | | | 1,697,904 |
| | Profit or loss | | | Equity | |||||||
| | +0.5% US$ | | | -0.5% US$ | | | +0.5% US$ | | | -0.5% US$ | |
2021 | | | | | | | | | ||||
Cash and cash equivalents | | | 8,490 | | | (8,490) | | | 8,490 | | | (8,490) |
(e) | Foreign Currency Risk |
(f) | Commodity Price Risk |
(g) | Capital Management |
(h) | Fair Value |
20. | CONTINGENT ASSETS AND LIABILITIES |
21. | EVENTS SUBSEQUENT TO BALANCE DATE |
(a) | On 12 July 2021, the Company announced that PricewaterhouseCoopers was appointed as auditor of the Company following the resignation of BDO Audit (WA) Pty Ltd and ASIC’s consent to the resignation in accordance with section 329(5) of the Corporations Act 2001; |
(b) | On 22 July 2021, the Company announced the execution of a memorandum of understanding (“MOU”) for a technology partnership with EOS GmbH (“EOS”), the world’s leading solution supplier in the field of industrial 3D printing (known as additive manufacturing, or AM) of metals and plastics; |
(c) | On 31 August 2021, the Company completed a placement of 20 million shares at an issue price of A$1.20 per share to institutional, sophisticated and professional investors to raise gross proceeds of A$24.0 million (US$17.6 million) (“Placement”). The Placement was led by cornerstone investor, Fidelity Management & Research Company, an American multinational financial services corporation; |
(d) | On October 21, 2021, the Company announced that it had purchased an option to acquire 100% of the ownership interests of Blacksand Technology, LLC on or before December 31, 2022. Blacksand holds the exclusive commercial licensing rights for more than forty global patents through a license agreement with the University of Utah including the global patents for the patented HAMR and GSD technologies that can produce low-cost and low carbon titanium metal; |
(e) | On December 6, 2021, the Company announced that it had signed a memorandum of understanding with Chemours to investigate the potential supply to Chemours of up to 50,000 metric tons of ilmenite, 10,000 metric tons of rutile, and 10,000 metric tons of staurolite. Chemours operates one of the largest titanium dioxide plants at its New Johnsonville plant which is located approximately 20 miles from the Company’s Titan Project in Tennessee; and |
(f) | On January 6, 2022, the Company announced that it plans to pursue a listing on a national securities exchange in the United States and will change its name to ‘IperionX Limited’; |
(g) | On February 9, 2022, the Company changed its name from ‘Hyperion Metals Limited’ to ‘IperionX Limited’; and |
(h) | The impact of the Coronavirus (COVID-19) pandemic is ongoing and while it has not significantly impacted the Company up to June 30, 2021, it is not practicable to estimate the potential impact, positive or negative, after the reporting date. The situation is rapidly developing and is dependent on measures imposed by the Australian, United States and other governments, such as maintaining social distancing requirements, quarantine, travel restrictions and any economic stimulus that may be provided. |
• | the operations, in financial years subsequent to June 30, 2021, of the Group; |
• | the results of those operations, in financial years subsequent to June 30, 2021, of the Group; or |
• | the state of affairs, in financial years subsequent to June 30, 2021, of the Group. |
| | Notes | | | 1 Jul 2020 to 1 Dec 2020 A$ | | | Restated(1) 1 Jul 2019 to 30 Jun 2020 A$ | |
Continuing operations | | | | | | | |||
Exploration and evaluation expenses | | | | | (60,828) | | | (122,778) | |
Corporate and administrative expenses | | | | | (366,600) | | | (678,772) | |
Share based payment expenses | | | | | (87,458) | | | (89,783) | |
Finance income | | | 2 | | | 3,870 | | | 22,651 |
Finance costs | | | 2 | | | — | | | (4,775) |
Impairment expenses | | | 2 | | | (464,205) | | | — |
Other income/(expenses) | | | 2 | | | (66,820) | | | 4,560 |
Loss before income tax | | | | | (1,042,041) | | | (868,897) | |
Income tax expense | | | 3 | | | — | | | — |
Loss for the period | | | | | (1,042,041) | | | (868,897) | |
Loss attributable to members of IperionX Limited | | | | | (1,042,041) | | | (868,897) | |
| | | | | | ||||
Other comprehensive income | | | | | | | |||
Items that may be reclassified subsequently to profit or loss: | | | | | | | |||
Exchange differences arising on translation of foreign operations | | | | | (33,566) | | | 9,448 | |
Other comprehensive income/(loss) for the period, net of tax | | | | | (33,566) | | | 9,448 | |
Total comprehensive loss for the period | | | | | (1,075,607) | | | (859,449) | |
Total comprehensive loss attributable to members of IperionX Limited | | | | | (1,075,607) | | | (859,449) | |
| | | | | | ||||
Basic loss per share (A$ per share) | | | 12 | | | (0.03) | | | (0.03) |
Diluted loss per share (A$ per share) | | | 12 | | | (0.03) | | | (0.03) |
(1) | With effect from 1 July 2019, the policy for accounting for exploration expenditure has changed from the policy applied in previous reporting periods (refer Note 1(d)). |
| | Notes | | | 1 Dec 2020 A$ | | | Restated(1) 30 Jun 2020 A$ | |
ASSETS | | | | | | | |||
Current Assets | | | | | | | |||
Cash and cash equivalents | | | 5 | | | 2,717,623 | | | 1,649,187 |
Trade and other receivables | | | | | 19,608 | | | 42,438 | |
Loan to Hyperion Metals (Australia) Pty Ltd | | | | | 449,879 | | | — | |
Prepayments | | | | | — | | | 24,875 | |
Total Current Assets | | | | | 3,187,110 | | | 1,716,500 | |
| | | | | | ||||
Non-Current Assets | | | | | | | |||
Exploration and evaluation assets | | | 6 | | | — | | | 487,743 |
Property, plant and equipment | | | | | — | | | 30,800 | |
Total Non-Current Assets | | | | | — | | | 518,543 | |
TOTAL ASSETS | | | | | 3,187,110 | | | 2,235,043 | |
| | | | | | ||||
LIABILITIES | | | | | | | |||
Current Liabilities | | | | | | | |||
Trade and other payables | | | 7 | | | 139,075 | | | 68,602 |
Lease liabilities | | | 8 | | | — | | | 25,960 |
Total Current Liabilities | | | | | 139,075 | | | 94,562 | |
TOTAL LIABILITIES | | | | | 139,075 | | | 94,562 | |
| | | | | | ||||
NET ASSETS | | | | | 3,048,035 | | | 2,140,481 | |
| | | | | | ||||
EQUITY | | | | | | | |||
Contributed equity | | | 9 | | | 5,673,818 | | | 4,577,708 |
Reserves | | | 10 | | | 1,091,451 | | | 1,191,666 |
Accumulated losses | | | 11 | | | (3,717,234) | | | (3,628,893) |
TOTAL EQUITY | | | | | 3,048,035 | | | 2,140,481 |
(1) | With effect from 1 July 2019, the policy for accounting for exploration expenditure has changed from the policy applied in previous reporting periods (refer Note 1(d)). |
| | Contributed Equity | | | Share Based Payments Reserve A$ | | | Option Premium Reserve A$ | | | Foreign Currency Translation Reserve A$ | | | Accumulated Losses A$ | | | Total Equity A$ | |
Balance at 1 July 2020 (restated)(1) | | | 4,577,708 | | | 993,483 | | | 153,750 | | | 44,433 | | | (3,628,893) | | | 2,140,481 |
Net loss for the period | | | — | | | — | | | — | | | — | | | (1,042,041) | | | (1,042,041) |
Exchange differences arising on translation of foreign operations | | | — | | | — | | | — | | | (33,566) | | | — | | | (33,566) |
Total comprehensive loss for the period | | | — | | | — | | | — | | | (33,566) | | | (1,042,041) | | | (1,075,607) |
Share placements | | | 2,000,000 | | | — | | | — | | | — | | | — | | | 2,000,000 |
Share issue costs | | | (991,500) | | | 871,500 | | | — | | | — | | | — | | | (120,000) |
Conversion of performance rights | | | 87,610 | | | (87,600) | | | — | | | — | | | — | | | 10 |
Issue of listed options | | | — | | | — | | | 15,693 | | | — | | | — | | | 15,693 |
Expiry of unlisted options | | | — | | | (953,700) | | | — | | | — | | | 953,700 | | | — |
Share based payments | | | — | | | 87,458 | | | — | | | — | | | — | | | 87,458 |
Balance at 1 December 2020 | | | 5,673,818 | | | 911,141 | | | 169,443 | | | 10,867 | | | (3,717,234) | | | 3,048,035 |
| | | | | | | | | | | | |||||||
Balance at 1 July 2019 | | | 4,527,708 | | | 953,700 | | | 153,750 | | | 56,941 | | | (2,178,110) | | | 3,513,989 |
Effect of change in accounting policy(1) | | | — | | | — | | | — | | | (21,956) | | | (581,886) | | | (603,842) |
Balance at 1 July 2019 (restated)(1) | | | 4,527,708 | | | 953,700 | | | 153,750 | | | 34,985 | | | (2,759,996) | | | 2,910,147 |
Net loss for the period | | | — | | | — | | | — | | | — | | | (868,897) | | | (868,897) |
Exchange differences arising on translation of foreign operations | | | — | | | — | | | — | | | 9,448 | | | — | | | 9,448 |
Total comprehensive loss for the period | | | — | | | — | | | — | | | 9,448 | | | (868,897) | | | (859,449) |
Share based payments | | | 50,000 | | | 39,783 | | | — | | | — | | | — | | | 89,783 |
Balance at 30 June 2020 (restated)(1) | | | 4,577,708 | | | 993,483 | | | 153,750 | | | 44,433 | | | (3,628,893) | | | 2,140,481 |
(1) | With effect from 1 July 2019, the policy for accounting for exploration expenditure has changed from the policy applied in previous reporting periods (refer Note 1(d)). |
| | Notes | | | 1 Jul 2020 to 1 Dec 2020 A$ | | | Restated(1) 1 Jul 2019 to 30 Jun 2020 A$ | |
Operating activities | | | | | | | |||
Payments to suppliers and employees | | | | | (393,110) | | | (809,330) | |
Interest paid | | | | | — | | | (4,775) | |
Interest received | | | | | 3,870 | | | 22,651 | |
Other income | | | | | 12,456 | | | 12,156 | |
Net cash flows used in operating activities | | | 5 | | | (376,784) | | | (779,298) |
| | | | | | ||||
Investing activities | | | | | | | |||
Loan to Hyperion Metals (Australia) Pty Ltd | | | | | (449,879) | | | — | |
Purchase of property, plant and equipment | | | | | (604) | | | (6,423) | |
Net cash flows used in investing activities | | | | | (450,483) | | | (6,423) | |
| | | | | | ||||
Financing activities | | | | | | | |||
Proceeds from issue of shares | | | 9(a) | | | 2,000,000 | | | — |
Share issue costs | | | 9(a) | | | (120,000) | | | — |
Proceeds from conversion of performance rights | | | | | 10 | | | — | |
Proceeds from issue of options | | | | | 15,693 | | | — | |
Payment of principal portion of lease liabilities | | | | | — | | | (31,225) | |
Net cash flows from financing activities | | | | | 1,895,703 | | | (31,225) | |
| | | | | | ||||
Net increase/(decrease) in cash and cash equivalents | | | | | 1,068,436 | | | (816,946) | |
Net foreign exchange differences | | | | | — | | | — | |
Cash and cash equivalents at beginning of period | | | | | 1,649,187 | | | 2,466,133 | |
Cash and cash equivalents at the end of the period | | | 5 | | | 2,717,623 | | | 1,649,187 |
(1) | With effect from 1 July 2019, the policy for accounting for exploration expenditure has changed from the policy applied in previous reporting periods (refer Note 1(d)). |
1. | STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES |
(a) | Basis of preparation |
(b) | New standards, interpretations and amendments |
• | Definition of a Business (Amendments to IFRS 3) |
• | Definition of Material (Amendments to IAS 1 and IAS 8) |
• | Amendments to References to the Conceptual Framework in IFRS Standards |
(c) | Issued standards and interpretations not early adopted |
Standard/Interpretation | | | Application Date of Standard | | | Application Date for the Group |
Annual Improvements to IFRS Standards 2018–2020 | | | January 1, 2022 | | | July 1, 2022 |
Classification of Liabilities as Current or Non-Current (Amendments to IAS 1) | | | January 1, 2023 | | | July 1, 2023 |
Classification of Liabilities as Current or Non-current — Deferral of Effective Date (Amendment to IAS 1) | | | January 1, 2023 | | | July 1, 2023 |
(d) | Changes in Accounting Policy |
• | Such costs are expected to be recouped through successful development and exploitation of the area of interest, or alternatively by its sale; or |
• | Exploration and evaluation activities in the area of interest have not yet reached a stage which permits a reasonable assessment of the existence or otherwise of economically recoverable reserves, and active and significant operations in, or in relation to, the area are continuing. |
Consolidated statement of financial position | | | As previously reported at 1 July 2019 $ | | | Effect of change in accounting policy $ | | | As adjusted at 1 July 2019 $ |
Exploration and evaluation assets | | | 1,081,149 | | | (603,843) | | | 477,306 |
Foreign currency translation reserve | | | 56,941 | | | (21,956) | | | 34,985 |
Accumulated losses | | | (2,178,110) | | | (581,886) | | | (2,759,996) |
Consolidated statement of financial position | | | 30 June 2020 A$ |
Decrease in exploration and evaluation assets | | | (737,153) |
Increase/(decrease) in equity | | | (737,153) |
Consolidated statement of profit or loss and other comprehensive income | | | Year Ended 30 June 2020 A$ |
Increase in exploration and evaluation expenses | | | (122,778) |
Increase/(decrease) in profit or loss | | | (122,778) |
(e) | Principles of Consolidation |
(f) | Foreign Currencies |
(i) | Functional and presentation currency |
(ii) | Transactions and balances |
(iii) | Group companies |
• | 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. |
(g) | Cash and Cash Equivalents |
(h) | Trade and Other Receivables |
(i) | Property, Plant and Equipment |
| | 1 Dec 2020 | | | 30 Jun 2020 | |
Major depreciation periods are: | | | | | ||
Plant and equipment: | | | 5 years | | | 5 years |
(j) | Exploration and Development Expenditure |
(i) | the rights to tenure of the area of interest are current; and |
(ii) | at least one of the following conditions is also met: |
• | the exploration and evaluation expenditures are expected to be recouped through successful development and exploitation of the area of interest, or alternatively, by its sale; and |
• | exploration and evaluation activities in the area of interest have not at the reporting date reached a stage which permits a reasonable assessment of the existence or otherwise of economically recoverable reserves, and active and significant operations in, or in relation to, the area of interest are continuing. |
(k) | Trade and other payables |
(l) | Provisions |
(m) | Interest income |
(n) | Government grant income |
(o) | Income Tax |
(p) | Employee Entitlements |
(q) | Earnings per Share |
(r) | Goods and Services Tax |
(s) | Use and Revision of Accounting Estimates, Judgements and Assumptions |
• | Recognition of tax losses (Note 3); |
• | Write-off of exploration and evaluation expenditures (Note 2); and |
• | Share-based payments (Note 15). |
(t) | Operating Segments |
• | Nature of the products and services, |
• | Nature of the production processes, |
• | Type or class of customer for the products and services, |
• | Methods used to distribute the products or provide the services, and if applicable, |
• | Nature of the regulatory environment. |
(u) | Impairment of Assets |
(v) | Fair Value Estimation |
(w) | Issued and Unissued Capital |
(x) | Dividends |
(y) | Share-Based Payments |
2. | INCOME AND EXPENSES |
| | 1 Dec 2020 A$ | | | 30 Jun 2020 A$ | |
Finance income | | | | | ||
Interest income | | | 3,870 | | | 22,651 |
| | 3,870 | | | 22,651 | |
| | | | |||
Finance costs | | | | | ||
Interest on lease liabilities | | | — | | | (4,775) |
| | — | | | (4,775) | |
| | | | |||
Impairment expenses | | | | | ||
Write-off of exploration and evaluation assets(1) | | | (454,309) | | | — |
Write-off of property, plant and equipment | | | (6,896) | | | — |
Write-off of trade and other receivables | | | (3,000) | | | — |
| | (464,205) | | | — | |
| | | | |||
Other income and expenses | | | | | ||
Grant income(2) | | | 12,456 | | | 37,368 |
Gain on derecognition of right-of-use assets | | | 1,453 | | | — |
Depreciation and amortisation | | | — | | | (32,808) |
Transaction costs related to acquisition of HMAPL | | | (80,729) | | | — |
| | (66,820) | | | 4,560 |
| | 1 Dec 2020 A$ | | | 30 Jun 2020 A$ | |
| | | | |||
Employee benefits expense | | | | | ||
Wages, salaries and other payroll expenses | | | (143,400) | | | (312,611) |
Share-based payments expense | | | (87,458) | | | (39,784) |
| | (230,858) | | | (352,395) |
(1) | During the period, the Group made the decision to write-off all capitalised exploration costs associated with the Milford Project on the basis that minimal future exploration and evaluation expenditures are planned for the Milford Project. Refer to Note 6 for further details. |
(2) | During the period ended 1 December 2020 and the year ended 30 June 2020, the Group received a cash flow boost from the Australian Government as part of temporary cash flow support to businesses that employ staff during the economic downturn associated with COVID-19. |
3. | INCOME TAX |
| | 1 Dec 2020 A$ | | | 30 Jun 2020 A$ | |
Recognised in profit or loss | | | | | ||
Current income tax: | | | | | ||
Current income tax benefit in respect of the current period | | | — | | | — |
Deferred income tax: | | | | | ||
Origination and reversal of temporary differences | | | — | | | — |
Income tax expense reported in profit or loss | | | — | | | — |
| | | | |||
Reconciliation between tax expense and accounting loss before income tax | | | | | ||
Accounting loss before income tax | | | (1,042,041) | | | (868,897) |
At the Australian income tax rate of 30% (2020: 30%) | | | (312,612) | | | (260,669) |
Expenditure not allowable for income tax purposes | | | 186,749 | | | 119,726 |
Income not assessable for income tax purposes | | | — | | | (11,210) |
Other temporary differences | | | — | | | (31,992) |
Effect of deferred tax assets not brought to account | | | 125,863 | | | 184,145 |
Income tax expense reported in profit or loss | | | — | | | — |
| | | | |||
Deferred Tax Assets and Liabilities | | | | | ||
Deferred Tax Liabilities: | | | | | ||
Other temporary differences | | | — | | | 7,462 |
Deferred tax assets used to offset deferred tax liabilities | | | — | | | (7,462) |
| | — | | | — | |
Deferred Tax Assets: | | | | | ||
Property, plant and equipment | | | — | | | 436 |
Capital allowances | | | — | | | 54,459 |
Other temporary differences | | | 24,300 | | | 9,307 |
Tax losses available to offset against future taxable income | | | 552,891 | | | 467,830 |
Deferred tax assets used to offset deferred tax liabilities | | | — | | | (7,462) |
Deferred tax assets not brought to account (1) | | | (577,191) | | | (524,570) |
| | — | | | — |
(1) | The benefit of deferred tax assets not brought to account will only be brought to account if: (a) future assessable income is derived of a nature and of an amount sufficient to enable the benefit to be realised; (b) the conditions for deductibility imposed by tax legislation continue to be complied with; and (c) no changes in tax legislation adversely affect the Group in realising the benefit. |
4. | DIVIDENDS PAID OR PROVIDED FOR ON ORDINARY SHARES |
5. | CASH AND CASH EQUIVALENTS |
| | 1 Dec 2020 A$ | | | 30 Jun 2020 A$ | |
Cash at bank and on hand | | | 2,717,623 | | | 1,649,187 |
| | 2,717,623 | | | 1,649,187 | |
| | | | |||
Reconciliation of loss before income tax to net cash flows from operations | | | | | ||
Loss for the period | | | (1,042,041) | | | (868,897) |
Adjustment for non-cash income and expense items | | | | | ||
Share based payment expenses | | | 87,458 | | | 89,783 |
Write-off of exploration and evaluation assets | | | 454,309 | | | — |
Write-off of property, plant and equipment | | | 6,897 | | | — |
Gain on derecognition of right-of-use assets | | | (1,453) | | | — |
Amortisation of right-of-use assets | | | — | | | 32,678 |
Depreciation of property, plant and equipment | | | — | | | 130 |
Change in assets and liabilities | | | | | ||
(Increase)/decrease in trade and other receivables | | | 22,830 | | | (27,307) |
(Increase)/decrease in prepayments | | | 24,875 | | | (4,991) |
(Decrease)/increase in trade and other payables | | | 70,341 | | | (694) |
Net cash outflow from operating activities | | | (376,784) | | | (779,298) |
6. | EXPLORATION AND EVALUATION ASSETS |
| | Milford Project(1) A$ | |
1 December 2020 | | | |
Carrying amount at 1 July 2020 (restated) | | | 487,742 |
Foreign exchange differences | | | (33,433) |
Write-off(2) | | | (454,309) |
Carrying amount at 1 December 2020(3) | | | — |
| | ||
30 June 2020 | | | |
Carrying amount at 1 July 2019 (restated) | | | 477,306 |
Foreign exchange differences | | | 10,436 |
Carrying amount at 30 June 2020 (restated)(3) | | | 487,742 |
(1) | At 1 December 2020, the Milford Project comprised 100 Mining Rights on U.S. Bureau of Land Management (“BLM”) administered land, situated approximately 6 kilometres west of the town of Milford in Utah, United States. The Milford Project is considered prospective for epithermal and replacement style precious and base metal mineralisation along structural corridors in reactive host rocks. |
(2) | During the period, the Group made the decision to write-off all capitalised exploration costs associated with the Milford Project, being a total of A$454,309, on the basis that minimal future exploration and evaluation expenditures are planned for the Milford Project. |
(3) | The ultimate recoupment of costs carried forward for exploration and evaluation is dependent on the successful development and commercial exploitation or sale of the respective areas of interest. |
7. | TRADE AND OTHER PAYABLES |
| | 1 Dec 2020 A$ | | | 30 Jun 2020 A$ | |
Current | | | | | ||
Trade payables | | | 46,119 | | | 11,478 |
Accruals | | | 81,000 | | | 26,404 |
Payroll liabilities | | | 11,956 | | | 30,720 |
Total trade and other payables | | | 139,075 | | | 68,602 |
8. | LEASES |
| | 1 Dec 2020 A$ | | | 30 Jun 2020 A$ | |
Depreciation of right-of-use assets | | | — | | | (32,678) |
Interest expense on lease liabilities | | | — | | | (4,775) |
Net amount recognised in profit or loss | | | — | | | (37,453) |
9. | CONTRIBUTED EQUITY |
| | Note | | | 1 Dec 2020 A$ | | | 30 Jun 2020 A$ | |
Issued capital | | | | | | | |||
57,386,667 fully paid ordinary shares1 (2020: 31,386,667) | | | 9(a) | | | 5,673,818 | | | 4,577,708 |
(1) | Ordinary shares have no par value and the Company does not have a limited amount of authorised capital. |
(a) | Movements in issued capital |
| | Number of Ordinary Shares | | | A$ | |
1 December 2020 | | | | | ||
Opening balance at 1 July 2020 | | | 31,386,667 | | | 4,577,708 |
Issue of shares – share placement (December 2020) | | | 25,000,000 | | | 2,000,000 |
Issue of shares – conversion of performance rights | | | 1,000,000 | | | 87,610 |
Share issue costs | | | — | | | (991,500) |
Closing balance at 1 December 2020 | | | 57,386,667 | | | 5,673,818 |
| | | | |||
30 June 2020 | | | | | ||
Opening balance at 1 July 2019 | | | 30,970,000 | | | 4,527,708 |
Issue of shares – option fee | | | 416,667 | | | 50,000 |
Closing balance at 30 June 2020 | | | 31,386,667 | | | 4,577,708 |
(b) | Rights attaching to ordinary shares |
(i) | Shares - The issue of shares in the capital of the Company and options over unissued shares by the Company is under the control of the directors, subject to the Corporations Act 2001, ASX Listing Rules and any rights attached to any special class of shares. |
(ii) | Meetings of Members - Directors may call a meeting of members whenever they think fit. Members may call a meeting as provided by the Corporations Act 2001.The Constitution contains provisions prescribing the content requirements of notices of meetings of members and all members are entitled to a notice of meeting. A meeting may be held in two or more places linked together by audio-visual communication devices. A quorum for a meeting of members is 2 shareholders. The Company holds annual general meetings in accordance with the Corporations Act 2001 and the Listing Rules. |
(iii) | Voting - Subject to any rights or restrictions at the time being attached to any shares or class of shares of the Company, each member of the Company is entitled to receive notice of, attend and vote at a general meeting. Resolutions of members will be decided by a show of hands unless a poll is demanded. On a show of hands each eligible voter present has one vote. However, where a person present at a general meeting represents personally or by proxy, attorney or representative more than one member, on a show of hands the person is entitled to one vote only despite the number of members the person represents. On a poll each eligible member has one vote for each fully paid share held and a fraction of a vote for each partly paid share determined by the amount paid up on that share. |
(iv) | Changes to the Constitution - The Company's Constitution can only be amended by a special resolution passed by at least three quarters of the members present and voting at a general meeting of the Company. At least 28 days' written notice specifying the intention to propose the resolution as a special resolution must be given. |
(v) | Listing Rules - Provided the Company remains admitted to the Official List, then despite anything in its Constitution, no act may be done that is prohibited by the Listing Rules, and authority is given for acts required to be done by the Listing Rules. The Company's Constitution will be deemed to comply with the Listing Rules as amended from time to time. |
10. | RESERVES |
| | Note | | | 1 Dec 2020 A$ | | | 30 Jun 2020 A$ | |
Option premium reserve | | | 10(b) | | | 169,443 | | | 153,750 |
Share-based payments reserve | | | 10(c) | | | 911,141 | | | 993,483 |
Foreign currency translation reserve | | | 10(g) | | | 10,867 | | | 44,433 |
| | | | 1,091,451 | | | 1,191,666 |
(a) | Nature and purpose of reserves |
(i) | Option premium reserve |
(ii) | Share-based payments reserve |
(iii) | Foreign currency translation reserve |
(b) | Movements in option premium reserve |
| | Number of Listed Options | | | A$ | |
1 December 2020 | | | | | ||
Opening balance at 1 July 2020 | | | 15,448,351 | | | 153,750 |
Expiry of listed options | | | (15,448,351) | | | — |
Issue of listed options | | | 15,693,334 | | | 15,693 |
Closing balance at 1 December 2020 | | | 15,693,334 | | | 169,443 |
| | | | |||
30 June 2020 | | | | | ||
Opening balance at 1 July 2019 | | | 15,448,351 | | | 153,750 |
Closing balance at 30 June 2020 | | | 15,448,351 | | | 153,750 |
(c) | Movements in share-based payments reserve |
| | Number of Incentive Options | | | Number of Performance Rights | | | A$ | |
1 December 2020 | | | | | | | |||
Opening balance at 1 July 2020 | | | 11,000,000 | | | 3,000,000 | | | 993,483 |
Issue of unlisted placement options | | | 5,000,000 | | | — | | | 871,500 |
Expiry of unlisted options | | | (11,000,000) | | | — | | | (953,700) |
Conversion of performance rights | | | — | | | (1,000,000) | | | (87,600) |
Share-based payment expense | | | — | | | — | | | 87,458 |
Closing balance at 1 December 2020 | | | 5,000,000 | | | 2,000,000 | | | 911,141 |
| | | | | | ||||
30 June 2020 | | | | | | | |||
Opening balance at 1 July 2019 | | | 11,000,000 | | | — | | | 953,700 |
Issue of performance rights | | | — | | | 4,500,000 | | | — |
Lapse of performance rights | | | — | | | (1,500,000) | | | — |
Share-based payment expense | | | — | | | — | | | 39,783 |
Closing balance at 30 June 2020 | | | 11,000,000 | | | 3,000,000 | | | 993,483 |
(1) | For details on the valuation of Unlisted Options and Performance Rights, including models and assumptions used, refer to Note 16 of the financial statements. |
(d) | Terms and conditions of Listed Options |
• | Each Listed Option entitles the holder to the right to subscribe for one Share upon the exercise of each Listed Option; |
• | The Listed Options outstanding at the end of the financial period have the following exercise prices and expiry dates: |
○ | 15,693,334 Listed Options exercisable at A$0.20 each on or before August 31, 2021; |
• | The Listed Options are exercisable at any time prior to the Expiry Date; |
• | Shares issued on exercise of the Listed Options rank equally with the then Shares of the Company; |
• | Application will be made by the Company to ASX for official quotation of the Shares issued upon the exercise of the Listed Options; |
• | If there is any reconstruction of the issued share capital of the Company, the rights of the Listed Options holders may be varied to comply with the ASX Listing Rules which apply to the reconstruction at the time of the reconstruction; and |
• | The Listed Options are quoted on ASX. |
(e) | Terms and conditions of Unlisted Options |
• | Each Unlisted Option entitles the holder to the right to subscribe for one Share upon the exercise of each Unlisted Option; |
• | The Unlisted Options granted as share based payments at the end of the financial period have the following exercise prices and expiry dates: |
○ | 5,000,000 Unlisted Options exercisable at A$0.20 each on or before December 31, 2023. |
• | The Unlisted Options are exercisable at any time prior to the Expiry Date, subject to vesting conditions being satisfied (if applicable); |
• | Shares issued on exercise of the Unlisted Options rank equally with the then Shares of the Company; |
• | Application will be made by the Company to ASX for official quotation of the Shares issued upon the exercise of the Unlisted Options; |
• | If there is any reconstruction of the issued share capital of the Company, the rights of the Unlisted Option holders may be varied to comply with the ASX Listing Rules which apply to the reconstruction at the time of the reconstruction; and |
• | No application for quotation of the Unlisted Options will be made by the Company. |
(f) | Terms and conditions of Performance Rights |
• | Each Performance Right automatically converts into one Share upon vesting of the Performance Right; |
• | Each Performance Right is subject to performance conditions (as determined by the Board from time to time) which must be satisfied in order for the Performance Right to vest; |
• | The Performance Rights outstanding at the end of the financial period have the following performance conditions and expiry dates: |
○ | 1,000,000 performance rights that vest upon a 20-day VWAP of A$0.40 per share, expiring 24 November 2022; and |
○ | 1,000,000 performance rights that vest upon a 20-day VWAP of A$0.55 per share, expiring 24 November 2022; |
• | Application will be made by the Company to ASX for official quotation of the Shares issued upon conversion of the Performance Rights; |
• | If there is any reconstruction of the issued share capital of the Company, the rights of the Performance Right holders may be varied to comply with the ASX Listing Rules which apply to the reconstruction at the time of the reconstruction; |
• | No application for quotation of the Performance Rights will be made by the Company; and |
• | Without approval of the Board, Performance Rights may not be transferred, assigned or novated, except, upon death, a participant's legal personal representative may elect to be registered as the new holder of such Performance Rights and exercise any rights in respect of them. |
(g) | Movements in foreign currency translation reserve |
| | 1 Dec 2020 A$ | | | 30 Jun 2020 A$ | |
Balance at start of period | | | 44,433 | | | 34,985 |
Exchange differences arising on translation of foreign operations | | | (33,566) | | | 9,448 |
Balance at end of period | | | 10,867 | | | 44,433 |
11. | ACCUMULATED LOSSES |
| | 1 Dec 2020 A$ | | | 30 Jun 2020 A$ | |
Balance at start of period (restated) | | | (3,628,893) | | | (2,759,996) |
Net loss for the period (restated) | | | (1,042,041) | | | (868,897) |
Expiry of options | | | 953,700 | | | — |
Balance at end of period (restated) | | | (3,717,234) | | | (3,628,893) |
12. | LOSS PER SHARE |
| | 1 Dec 2020 A$ | | | 30 Jun 2020 A$ | |
Basic loss per share | | | (0.03) | | | (0.03) |
Diluted loss per share | | | (0.03) | | | (0.03) |
| | 1 Dec 2020 A$ | | | 30 Jun 2020 A$ | |
Net loss | | | (1,042,041) | | | (868,897) |
Loss used in calculating basic and dilutive loss per share | | | (1,042,041) | | | (868,897) |
| | Number of Ordinary Shares 1 Dec 2020 | | | Number of Ordinary Shares 30 Jun 2020 | |
Weighted average number of Ordinary Shares used in calculating basic and dilutive loss per share | | | 31,737,316 | | | 31,340,238 |
(a) | Non-Dilutive Securities |
(b) | Conversions, Calls, Subscriptions or Issues after 1 December 2020 |
(a) | 29,150,000 ordinary shares, 5,000,000 unlisted options, 8,000,000 performance options and 39,600,000 performance shares in the Company in regards to the acquisition of the Titan Project; |
(b) | 12,150,000 ordinary shares pursuant to a share placement to institutional and sophisticated investors in February 2021; |
(c) | 20,000,000 ordinary shares pursuant to a share placement to institutional, sophisticated and professional investors in August 2021; |
(d) | 15,675,824 ordinary shares pursuant to the exercise of listed options; |
(e) | 2,750,000 ordinary shares pursuant to the exercise of unlisted options; |
(f) | 2,000,000 ordinary shares pursuant to the conversion of performance rights; |
(g) | 9,150,000 unlisted options and 16,325,000 performance rights to employees and consultants; |
(h) | 600,000 restricted stock units to new Directors of the Company; and |
(i) | 600,000 unlisted options to new Directors of the Company. |
13. | RELATED PARTIES |
(a) | Subsidiaries |
| | Country of Incorporation | | | Equity Interest % | ||||
| | 1 Dec 2020 | | | 30 Jun 2020 | ||||
Calatos Pty Ltd LLC | | | United States | | | 100% | | | 100% |
(b) | Ultimate Parent |
(c) | Transactions with Key Management Personnel |
| | 1 Dec 2020 A$ | | | 30 Jun 2020 A$ | |
Short-term employee benefits | | | 82,075 | | | 202,154 |
Post-employment benefits | | | 7,125 | | | 19,205 |
Share-based payments | | | 87,458 | | | 39,784 |
Total compensation | | | 176,658 | | | 261,143 |
(d) | Other transactions with Related Parties |
14. | PARENT ENTITY DISCLOSURES |
| | 1 Dec 2020 A$ | | | 30 Jun 2020 A$ | |
(a) Financial Position | | | | | ||
Assets | | | | | ||
Current Assets | | | 3,187,110 | | | 1,716,500 |
Non-Current Assets | | | — | | | 518,453 |
Total Assets | | | 3,187,110 | | | 2,235,043 |
Liabilities | | | | | ||
Current Liabilities | | | (139,075) | | | (94,562) |
Total Liabilities | | | (139,075) | | | (94,562) |
Equity | | | | | ||
Contributed equity | | | 5,673,818 | | | 4,577,708 |
Reserves | | | 1,080,584 | | | 1,147,233 |
Accumulated losses | | | (3,706,369) | | | (3,584,460) |
Total Equity | | | 3,048,035 | | | 2,140,481 |
| | | | |||
(b) Financial Performance | | | | | ||
Loss for the period | | | (1,075,609) | | | (746,119) |
Other comprehensive loss | | | — | | | — |
Total comprehensive loss | | | (1,075,609) | | | (746,119) |
(c) | Other |
15. | SHARE-BASED PAYMENTS |
(a) | Recognised share-based payment expense |
| | 1 Dec 2020 A$30 | | | Jun 2020 A$ | |
Expense arising from equity-settled share-based payment transactions | | | (87,458) | | | (39,783) |
(b) | Summary of Unlisted Options and Performance Rights granted as share-based payments |
| | 1 Dec 2020 Number | | | 1 Dec 2020 WAEP | | | 30 Jun 2020 Number | | | 30 Jun 2020 WAEP | |
Outstanding at beginning of period | | | 14,000,000 | | | A$0.24 | | | 11,000,000 | | | A$0.30 |
Lapsed during the period | | | (11,000,000) | | | — | | | — | | | — |
Performance rights converted during the period | | | (1,000,000) | | | — | | | — | | | — |
Unlisted options granted during the period | | | 5,000,000 | | | A$0.20 | | | — | | | — |
Performance rights granted during the period | | | — | | | — | | | 4,000,000 | | | — |
Performance rights forfeited during the period | | | — | | | — | | | (1,500,000) | | | — |
Outstanding at end of period | | | 7,000,000 | | | A$0.14 | | | 14,000,000 | | | A$0.24 |
| | Security Type | | | Number | | | Grant Date | | | Expiry Date | | | Exercise Price A$ | | | Fair Value A$ | |
1 December 2020 | | | | | | | | | | | | | ||||||
Series 1 | | | Options | | | 5,000,000 | | | 01-Dec-20 | | | 31-Dec-23 | | | $0.20 | | | $0.174 |
| | | | | | | | | | | | |||||||
30 June 2020 | | | | | | | | | | | | | ||||||
Series 2 | | | Rights | | | 1,000,000 | | | 25-Nov-19 | | | 25-Nov-22 | | | — | | | $0.0876 |
Series 3 | | | Rights | | | 1,000,000 | | | 25-Nov-19 | | | 25-Nov-22 | | | — | | | $0.0657 |
Series 4 | | | Rights | | | 1,000,000 | | | 25-Nov-19 | | | 25-Nov-22 | | | — | | | $0.0513 |
(c) | Weighted Average Remaining Contractual Life |
(d) | Range of Exercise Prices |
(e) | Weighted Average Share Price of Exercised Options |
(f) | Weighted Average Fair Value |
(g) | Option and Right Pricing Models |
| | 1 December 2020 | | | 30 June 2020 | |||||||
| | Series 1 | | | Series 2 | | | Series 3 | | | Series 4 | |
Fair value at grant date | | | A$0.174 | | | A$0.0876 | | | A$0.0657 | | | A$0.0513 |
Share price at grant date | | | A$0.26 | | | A$0.12 | | | A$0.12 | | | A$0.12 |
Vesting hurdle (20-day VWAP) | | | N/A | | | A$0.25 | | | A$0.40 | | | A$0.55 |
Exercise price | | | A$0.20 | | | A$0.00001 | | | A$0.00001 | | | A$0.00001 |
Expected life of options/rights1 | | | 3.1 years | | | 3.0 years | | | 3.0 years | | | 3.0 years |
Risk-free interest rate | | | 0.10% | | | 0.74% | | | 0.74% | | | 0.74% |
Expected volatility2 | | | 100% | | | 76% | | | 76% | | | 76% |
Expected dividend yield3 | | | — | | | — | | | — | | | — |
(1) | The expected life is based on the expiry date of the options or rights. |
(2) | The expected volatility reflects the assumption that the historical volatility is indicative of future trends, which may not necessarily be the actual outcome. |
(3) | The dividend yield reflects the assumption that the current dividend payout will remain unchanged. |
16. | SEGMENT INFORMATION |
(a) | Reconciliation of non-current assets by geographical location |
| | 1 Dec 2020 | | | 30 Jun 2020 | |
| | A$ | | | A$ | |
United States of America | | | — | | | 487,742 |
| | — | | | 487,742 |
17. | FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES |
(a) | Overview |
(b) | Credit Risk |
| | Note | | | 1 Dec 2020 A$ | | | 30 Jun 2020 A$ | |
Cash and cash equivalents | | | 5 | | | 2,717,623 | | | 1,649,187 |
Trade and other receivables | | | | | 19,605 | | | 42,438 | |
Loan to Hyperion Metals (Australia) Pty Ltd | | | | | 449,879 | | | — | |
| | | | 3,187,107 | | | 1,691,625 |
(c) | Liquidity Risk |
| | ≤1 year A$ | | | 1-5 years A$ | | | ≥5 years A$ | | | Total A$ | |
1 December 2020 | | | | | | | | | ||||
Financial liabilities | | | | | | | | | ||||
Trade and other payables | | | 139,075 | | | — | | | — | | | 139,075 |
| | 139,075 | | | — | | | — | | | 139,075 | |
| | | | | | | | |||||
30 June 2020 | | | | | | | | | ||||
Financial liabilities | | | | | | | | | ||||
Trade and other payables | | | 68,602 | | | — | | | — | | | 68,602 |
Lease liabilities | | | 25,960 | | | — | | | — | | | 25,960 |
| | 94,562 | | | — | | | — | | | 94,562 |
(d) | Interest Rate Risk |
| | Note | | | 1 Dec 2020 A$ | | | 30 Jun 2020 A$ | |
Interest-bearing financial instruments | | | | | | | |||
Cash at bank and on hand | | | 5 | | | 2,717,623 | | | 1,623,235 |
Short term deposits | | | | | — | | | 25,952 | |
| | | | 2,717,623 | | | 1,649,187 |
17. | FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES (continued) |
(d) | Interest Rate Risk (Continued) |
| | Profit or loss | | | Equity | |||||||
| | +0.5% A$ | | | —0.5% A$ | | | +0.5% A$ | | | —0.5% A$ | |
1 December 2020 | | | | | | | | | ||||
Cash and cash equivalents | | | 13,588 | | | (13,588) | | | 13,588 | | | (13,588) |
(e) | Foreign Currency Risk |
(f) | Commodity Price Risk |
(g) | Capital Management |
(h) | Fair Value |
18. | EVENTS SUBSEQUENT TO BALANCE DATE |
(a) | On 1 December 2020, the Company completed the acquisition of Hyperion Metals (Australia) Pty Ltd (“HMAPL”) which holds a 100% interest in the Titan Project comprising titanium and zircon prospective HMS properties in Tennessee, United States. The acquisition was accounted for as a reverse acquisition with HMAPL deemed to be the accounting acquirer; |
(b) | On 20 January 2021, the Company announced the appointment of Mr. Todd Hannigan as Non-Executive Chairman of the Company, in conjunction with Mr. Hannigan participating in a placement by the Company to raise A$3.6 million; |
(c) | On 1 February 2021, the Company announced that it had completed its previously announced placement of 12,150,000 shares to institutional and sophisticated investors to raise gross proceeds of A$3.6 million; |
(d) | On 15 February 2021, the Company announced that it had signed a research agreement and option for exclusive licence to develop titanium metal powders using the breakthrough HAMR technology invented by Dr. Z. Zak Fang and his team at the University of Utah with funding from ARPA-E, with Boeing and Arconic (formerly Alcoa, Inc.) as industrial partners; |
(e) | On 18 February 2021, the Company announced that experienced U.S. based resource company executive, Mr. Taso Arima, has been appointed Managing Director of the Company, effective from March 1, 2021; |
(f) | On 14 April 2021, the Company changed its name from ‘Tao Commodities Limited’ to ‘Hyperion Metals Limited’; |
(g) | On 12 July 2021, the Company announced that PricewaterhouseCoopers was appointed as auditor of the Company following the resignation of BDO Audit (WA) Pty Ltd and ASIC’s consent to the resignation in accordance with section 329(5) of the Corporations Act 2001; |
(h) | On 22 July 2021, the Company announced the execution of a memorandum of understanding (“MOU”) for a technology partnership with EOS GmbH (“EOS”), the world’s leading solution supplier in the field of industrial 3D printing (known as additive manufacturing, or AM) of metals and plastics; |
(i) | On 31 August 2021, the Company completed a placement of 20 million shares at an issue price of A$1.20 per share to institutional, sophisticated and professional investors to raise gross proceeds of A$24.0 million (US$17.6 million) (“Placement”). The Placement was led by cornerstone investor, Fidelity Management & Research Company, an American multinational financial services corporation; |
(j) | On October 21, 2021, the Company announced that it had purchased an option to acquire 100% of the ownership interests of Blacksand Technology, LLC on or before December 31, 2022. Blacksand holds the exclusive commercial licensing rights for more than forty global patents through a license agreement with the University of Utah including the global patents for the patented HAMR and GSD technologies that can produce low cost and low carbon titanium metal; |
(k) | On December 6, 2021, the Company announced that it had signed a memorandum of understanding with Chemours to investigate the potential supply to Chemours of up to 50,000 metric tons of ilmenite, 10,000 metric tons of rutile, and 10,000 metric tons of staurolite. Chemours operates one of the largest titanium dioxide plants at its New Johnsonville plant which is located approximately 20 miles from the Company’s Titan Project in Tennessee; and |
(l) | On January 6, 2022, the Company announced that it plans to pursue a listing on a national securities exchange in the United States and will change its name to ‘IperionX Limited’; |
(m) | On February 9, 2022, the Company changed its name from ‘Hyperion Metals Limited’ to ‘IperionX Limited’; and |
(n) | The impact of the Coronavirus (COVID-19) pandemic is ongoing and while it has not significantly impacted the Company up to 1 December 2020, it is not practicable to estimate the potential impact, positive or negative, after the reporting date. The situation is rapidly developing and is dependent on measures imposed by the Australian, United States and other governments, such as maintaining social distancing requirements, quarantine, travel restrictions and any economic stimulus that may be provided. |
• | the operations, in financial years subsequent to 1 December 2020, of the Group; |
• | the results of those operations, in financial years subsequent to 1 December 2020, of the Group; or |
• | the state of affairs, in financial years subsequent to 1 December 2020, of the Group. |
| | Note | | | Six Months Ended December 31, 2021 US$ | | | Period Ended December 31, 2020 (restated) US$ | |
Continuing operations | | | | | | | |||
Exploration and evaluation expenses | | | | | (3,431,522) | | | (285,215) | |
Corporate and administrative expenses | | | | | (998,378) | | | (185,031) | |
Business development expenses | | | | | (1,501,724) | | | (71,946) | |
Share-based payment expense | | | | | (4,764,135) | | | (841,896) | |
Finance income | | | | | 157,435 | | | 118 | |
Finance costs | | | | | (23,831) | | | — | |
Cost of listing on reverse acquisition | | | 9 | | | — | | | (5,141,126) |
Loss before income tax | | | | | (10,562,155) | | | (6,525,096) | |
Income tax expense | | | | | — | | | — | |
Loss for the period | | | | | (10,562,155) | | | (6,525,096) | |
Loss attributable to members of IperionX Limited | | | | | (10,562,155) | | | (6,525,096) | |
| | | | | | ||||
Other comprehensive income | | | | | | | |||
Items that may be reclassified subsequently to profit or loss: | | | | | | | |||
Exchange differences arising on translation of foreign operations | | | | | (232,068) | | | 75,680 | |
Other comprehensive loss for the period, net of tax | | | | | (232,068) | | | 75,680 | |
Total comprehensive loss for the period | | | | | (10,794,223) | | | (6,449,416) | |
Total comprehensive loss attributable to members of IperionX Limited | | | | | (10,794,223) | | | (6,449,416) | |
| | | | | | ||||
Loss per share | | | | | | | |||
Basic and diluted loss per share (US$ per share) | | | | | (0.08) | | | (0.40) |
(1) | The Condensed Consolidated Statement of Comprehensive Income for the comparative period ended December 31, 2020 has been restated. Refer to Note 9 for further information. |
| | Note | | | December 31, 2021 US$ | | | June 30, 2021 US$ | |
ASSETS | | | | | | | |||
Current Assets | | | | | | | |||
Cash and cash equivalents | | | | | 14,256,359 | | | 1,697,904 | |
Trade and other receivables | | | | | 19,722 | | | 341 | |
Prepayments | | | | | 37,185 | | | 49,069 | |
Total Current Assets | | | | | 14,313,266 | | | 1,747,314 | |
| | | | | | ||||
Non-Current Assets | | | | | | | |||
Exploration and evaluation assets | | | 4 | | | 885,725 | | | 504,750 |
Property, plant and equipment | | | | | 714,941 | | | 539,619 | |
Financial assets | | | | | 250,000 | | | — | |
Total Non-Current Assets | | | | | 1,850,666 | | | 1,044,369 | |
TOTAL ASSETS | | | | | 16,163,932 | | | 2,791,683 | |
| | | | | | ||||
LIABILITIES | | | | | | | |||
Current Liabilities | | | | | | | |||
Trade and other payables | | | | | 553,088 | | | 544,842 | |
Lease liabilities | | | | | 94,191 | | | 81,104 | |
Provisions | | | | | — | | | 11,069 | |
Total Current Liabilities | | | | | 647,279 | | | 637,015 | |
| | | | | | ||||
Non-Current Liabilities | | | | | | | |||
Lease liabilities | | | | | 464,696 | | | 394,548 | |
Total Non-Current Liabilities | | | | | 464,696 | | | 394,548 | |
TOTAL LIABILITIES | | | | | 1,111,975 | | | 1,031,563 | |
| | | | | | ||||
NET ASSETS | | | | | 15,051,957 | | | 1,760,120 | |
| | | | | | ||||
EQUITY | | | | | | | |||
Contributed equity | | | 5 | | | 29,669,773 | | | 10,255,369 |
Reserves | | | 6 | | | 9,175,176 | | | 4,735,588 |
Accumulated losses | | | | | (23,792,992) | | | (13,230,837) | |
TOTAL EQUITY | | | | | 15,051,957 | | | 1,760,120 |
| | Contributed Equity US$ | | | Share- Based Payments Reserve US$ | | | Foreign Currency Translation Reserve US$ | | | Accumulated Losses US$ | | | Total Equity US$ | |
Balance at July 1, 2021 | | | 10,255,369 | | | 4,738,007 | | | (2,419) | | | (13,230,837) | | | 1,760,120 |
Net loss for the period | | | — | | | — | | | — | | | (10,562,155) | | | (10,562,155) |
Exchange differences arising on translation of foreign operations | | | — | | | — | | | (232,068) | | | — | | | (232,068) |
Total comprehensive loss | | | — | | | — | | | (232,068) | | | (10,562,155) | | | (10,794,223) |
Issue of shares - share placement | | | 17,604,000 | | | — | | | — | | | — | | | 17,604,000 |
Issue of shares - exercise of options | | | 2,239,216 | | | (92,479) | | | — | | | — | | | 2,146,737 |
Share issue costs | | | (428,812) | | | — | | | — | | | — | | | (428,812) |
Share-based payment expense | | | — | | | 4,764,135 | | | — | | | — | | | 4,764,135 |
Balance at December 31, 2021 | | | 29,669,773 | | | 9,409,663 | | | (234,487) | | | (23,792,992) | | | 15,051,957 |
| | | | | | | | | | ||||||
Balance at incorporation (restated) | | | — | | | — | | | — | | | — | | | — |
Net loss for the period | | | — | | | — | | | — | | | (6,525,096) | | | (6,525,096) |
Exchange differences arising on translation of foreign operations | | | — | | | — | | | 75,680 | | | — | | | 75,680 |
Total comprehensive loss | | | — | | | — | | | 75,680 | | | (6,525,096) | | | (6,449,416) |
Issue of shares – incorporation | | | 1 | | | — | | | — | | | — | | | 1 |
Issue of shares – seed placement | | | 54,011 | | | — | | | — | | | — | | | 54,011 |
Reverse acquisition | | | 6,433,752 | | | 967,582 | | | — | | | — | | | 7,401,334 |
Share-based payment expense | | | — | | | 841,896 | | | — | | | — | | | 841,896 |
Balance at December 31, 2020 (restated) | | | 6,487,764 | | | 1,809,478 | | | 75,680 | | | (6,525,096) | | | 1,847,826 |
(1) | The Condensed Consolidated Statement of Changes in Equity for the comparative period ended December 31, 2020 has been restated. Refer to Note 9 for further information. |
| | Note | | | Six Months Ended December 31, 2021 US$ | | | Period Ended December 31, 2020 (restated) US$ | |
Cash flows from operating activities | | | | | | | |||
Payments to suppliers and employees | | | | | (5,892,972) | | | (452,022) | |
Interest received | | | | | 14,716 | | | 118 | |
Interest paid | | | | | (22,688) | | | — | |
Net cash flows used in operating activities | | | | | (5,900,944) | | | (451,904) | |
| | | | | | ||||
Cash flows from investing activities | | | | | | | |||
Purchase of exploration and evaluation assets | | | 4 | | | (380,975) | | | (74,903) |
Purchase of property, plant and equipment | | | | | (113,890) | | | — | |
Purchase of financial assets | | | | | (250,000) | | | — | |
Net cash flows (used in)/from investing activities | | | | | (744,865) | | | (74,903) | |
| | | | | | ||||
Cash flows from financing activities | | | | | | | |||
Proceeds from issue of shares | | | 5 | | | 19,750,737 | | | 54,012 |
Share issue costs | | | | | (428,812) | | | — | |
Payment of principal portion of lease liabilities | | | | | (26,626) | | | — | |
Net cash inflow on reverse acquisition | | | 9 | | | — | | | 2,329,111 |
Net cash flows from financing activities | | | | | 19,295,299 | | | 2,383,123 | |
| | | | | | ||||
Net increase in cash and cash equivalents | | | | | 12,649,490 | | | 1,856,316 | |
Net foreign exchange differences | | | | | (91,036) | | | 75,442 | |
Cash and cash equivalents at the beginning of the period | | | | | 1,697,905 | | | — | |
Cash and cash equivalents at the end of the period | | | | | 14,256,359 | | | 1,931,758 |
(1) | The Condensed Consolidated Statement of Cash Flows for the comparative period ended December 31, 2020 has been restated. Refer to Note 9 for further information. |
1. | SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES |
2. | SEGMENT INFORMATION |
3. | DIVIDENDS PAID OR PROVIDED FOR |
4. | EXPLORATION AND EVALUATION ASSETS |
| | Titan Project US$ | |
Carrying value at July 1, 2021 | | | 504,750 |
Additions | | | 380,975 |
Carrying amount at December 31, 2021(1) | | | 885,725 |
| | ||
Carrying value at incorporation | | | — |
Additions | | | 504,750 |
Carrying amount at June 30, 2021 | | | 504,750 |
(1) | The ultimate recoupment of costs carried forward for exploration and evaluation is dependent on the successful development and commercial exploitation or sale of the respective areas of interest. |
5. | CONTRIBUTED EQUITY |
| | December 31, 2021 US$ | | | June 30, 2021 US$ | |
139,488,491 ordinary shares (June 30, 2021: 105,105,787) | | | 29,669,773 | | | 10,255,369 |
| | 29,669,773 | | | 10,255,369 |
| | No. of Ordinary Shares | | | No. of Performance Shares | | | US$ | |
Opening balance at July 1, 2021 | | | 105,105,787 | | | 39,600,000 | | | 10,255,369 |
Issue of shares - share placement | | | 20,000,000 | | | — | | | 17,604,000 |
Issue of shares - exercise of listed options | | | 12,606,704 | | | — | | | 1,857,559 |
Issue of shares - exercise of unlisted options | | | 1,776,000 | | | — | | | 381,657 |
Share issue costs | | | — | | | — | | | (428,812) |
Closing balance at December 31, 2021 | | | 139,488,491 | | | 39,600,000 | | | 29,669,773 |
6. | RESERVES |
| | December 31, 2021 US$ | | | June 30, 2021 US$ | |
Share based payments reserve | | | 9,409,663 | | | 4,738,007 |
Foreign currency translation reserve | | | (234,478) | | | (2,419) |
Total Reserves | | | 9,175,185 | | | 4,735,588 |
| | No. of Listed Options | | | No. of Unlisted Options | | | No. of Performance Rights | | | No. of RSUs | | | US$ | |
Opening balance at July 1, 2021 | | | 12,624,214 | | | 25,800,000 | | | 16,325,000 | | | — | | | 4,738,007 |
Grant of employee incentive securities | | | — | | | 600,000 | | | 8,990,000 | | | 600,000 | | | — |
Exercise of options | | | (12,606,704) | | | (1,776,000) | | | — | | | — | | | (92,479) |
Expiry of options | | | (17,510) | | | — | | | — | | | — | | | — |
Share-based payments expense | | | — | | | — | | | — | | | — | | | 4,764,135 |
Closing balance at December 31, 2021 | | | — | | | 24,624,000 | | | 25,315,000 | | | 600,000 | | | 9,409,663 |
7. | SUBSIDIARIES |
| | Country of Incorporation | | | December 31, 2021 | | | June 30, 2021 | |
Parent Entity | | | | | | | |||
IperionX Limited | | | Australia | | | | | ||
Subsidiaries | | | | | | | |||
IperionX Inc. | | | USA | | | 100% | | | — |
IperionX Critical Minerals LLC | | | USA | | | 100% | | | 100% |
IperionX Materials & Technologies LLC | | | USA | | | 100% | | | 100% |
Hyperion Metals (Australia) Pty Ltd | | | Australia | | | 100% | | | 100% |
Calatos Pty Ltd LLC | | | USA | | | 100% | | | 100% |
8. | CONTINGENT ASSETS AND LIABILITIES |
9. | REVERSE ACQUISITION |
10. | SUBSEQUENT EVENTS AFTER BALANCE DATE |
(a) | On January 6, 2022, the Company announced that it plans to pursue a listing on a national securities exchange in the United States; and |
(b) | On February 9, 2022, the Company changed its name from ‘Hyperion Metals Limited’ to ‘IperionX Limited’. |
FINANCIAL STATEMENTS |
FINANCIAL STATEMENTS |
EXHIBITS. |
* | To be filed by amendment. |
+ | Certain confidential information contained in this document, marked by [***], has been omitted because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed. |
| | By: | | | /s/ Anastasios Arima | |
| | | | Anastasios Arima | ||
| | | | Chief Executive Officer and Managing Director |
Exhibit 1.1
Exhibit 1.2
IperionX Limited
ACN 618 935 372
Constitution
Dated: 25 September 2021
Table of contents
1 | Preliminary | 1 | |
1.1 | Definitions and interpretation | 1 | |
1.2 | Nature of the Company | 1 | |
1.3 | Replaceable rules | 1 | |
1.4 | Transitional provisions | 1 | |
2 | Shares | 1 | |
2.1 | Issue of Shares and options | 1 | |
2.2 | Preference Shares | 2 | |
2.3 | Variation of classes and class rights | 2 | |
2.4 | Converting Shares | 2 | |
2.5 | Reductions of capital and buy backs | 2 | |
2.6 | Ancillary powers regarding distributions | 3 | |
2.7 | Unmarketable parcels of Shares | 3 | |
2.8 | Registered holder is absolute owner | 3 | |
2.9 | Holding statements and certificates | 4 | |
3 | Restricted Securities | 4 | |
4 | Calls, Company Payments, Forfeiture and Liens | 4 | |
5 | Transfer of Shares | 5 | |
5.1 | Electronic transfer systems | 5 | |
5.2 | Forms of transfer | 5 | |
5.3 | Instrument of transfer | 5 | |
5.4 | Transferor is holder until transfer registered | 5 | |
5.5 | Refusal to register transfers | 5 | |
5.6 | No registration fee | 6 | |
5.7 | Transmission of Shares | 6 | |
6 | Proceeding of Members | 6 | |
6.1 | Who can call meetings of Members | 6 | |
6.2 | Annual general meeting | 6 | |
6.3 | How to call meetings of Members | 6 | |
6.4 | Right to attend meetings of Members | 7 | |
6.5 | Meeting of Members at more than one place | 8 | |
6.6 | Meeting of Member by Virtual Meeting | 8 | |
6.7 | Quorum | 8 | |
6.8 | Chairperson | 9 | |
6.9 | General conduct of meetings | 9 | |
6.10 | Resolutions of Members | 10 | |
6.11 | Direct Voting | 10 | |
6.12 | Polls | 11 | |
6.13 | Adjourned, cancelled and postponed meetings | 11 | |
6.14 | Number of votes | 12 | |
6.15 | Objections to qualification to vote | 13 | |
6.16 | Proxies, attorneys and representatives | 14 | |
7 | Directors | 16 | |
7.1 | Number of Directors | 16 | |
7.2 | Appointment of Directors | 16 | |
7.3 | Retirement of Directors and vacation of office | 16 | |
7.4 | Alternate Directors | 17 | |
7.5 | Remuneration of Directors | 18 | |
7.6 | Interests of Directors | 19 | |
8 | Officers | 20 | |
8.1 | Managing director | 20 | |
8.2 | Secretary | 21 | |
8.3 | Indemnity and insurance | 21 |
IperionX Limited
IperionX Limited
Page ii |
This Constitution is made on 25 September 2021
by | IperionX Limited ACN 618 935 372 (Company) |
It is agreed:
1 | Preliminary |
1.1 | Definitions and interpretation |
Schedule 1 applies and forms part of this constitution.
1.2 | Nature of the Company |
The Company is a public company limited by shares.
1.3 | Replaceable rules |
The replaceable rules in the Corporations Act do not apply to the Company.
1.4 | Transitional provisions |
This constitution has the effect that:
(a) | every Director, Alternate Director, senior manager and Secretary in office as at the Adoption Date continues in office subject to, and is taken to have been appointed or elected under, this constitution; |
(b) | any register maintained by the Company immediately before the Adoption Date is taken to be a register maintained under this constitution; |
(c) | any common seal adopted by the Company before the Adoption Date is taken to be the common seal until another common seal is adopted by the Company under this constitution; |
(d) | for the purposes of article 12.6(a)(ii), a cheque issued under a corresponding provision of the Previous Constitution is taken to have been issued under article 12.6(a)(ii); and |
(e) | unless a contrary intention appears in this constitution, all persons, things, agreements and circumstances appointed, approved, created or delegated by or under the Previous Constitution continue to have the same status, operation and effect as if they had occurred under this constitution on and after the Adoption Date. |
2 | Shares |
2.1 | Issue of Shares and options |
(a) | Subject to any rights and restrictions attached to a class of Shares, the Company may: |
(i) | allot and issue unissued Shares; and |
(ii) | grant options over unissued Shares, |
on any terms, at any time and for any consideration, as the Directors resolve.
(b) | The powers of the Company under article 2.1 may only be exercised by the Directors. |
IperionX Limited
2.2 | Preference Shares |
(a) | The Company may issue any Shares as preference Shares including: |
(i) | preference Shares which are liable to be redeemed in a manner permitted by the Corporations Act; and |
(ii) | preference Shares in accordance with the terms of Schedule 6, |
provided that such preference Shares are convertible into ordinary Shares in accordance with their terms.
(b) | Holders of preference Shares have the same rights as holders of ordinary Shares in relation to receiving Notices, reports and audited accounts, and attending meetings of Members. |
(c) | A holder of a preference Share only has the right to vote: |
(i) | during a period during which a Dividend (or part of a Dividend) in respect of the Share is in arrears; |
(ii) | on a proposal to reduce the share capital of the Company; |
(iii) | on a resolution to approve the terms of a buy back agreement; |
(iv) | on a proposal that affects rights attached to the Share; |
(v) | on a proposal to wind up the Company; |
(vi) | on a proposal for the disposal of the whole of the property, business and undertaking of the Company; and |
(vii) | during the winding up of the Company. |
2.3 | Variation of classes and class rights |
(a) | Subject to the terms of issue of Shares in a particular class, the Company may: |
(i) | vary or cancel rights attached to Shares in that class; or |
(ii) | convert Shares from one class to another, |
by a special resolution of the Company and:
(iii) | a special resolution passed at a meeting of the Members holding Shares in that class; or |
(iv) | the written consent of Members who are entitled to at least 75 per cent of the votes that may be cast in respect of Shares in that class. |
(b) | The provisions in this constitution concerning meetings of Members (with the necessary changes) apply to a meeting held under article 2.3(a)(iii). |
2.4 | Converting Shares |
The Company may by ordinary resolution passed at a meeting of Members convert all or any of its Shares into a larger or smaller number of Shares.
2.5 | Reductions of capital and buy backs |
(a) | Subject to the Corporations Act and the Listing Rules, the Company may: |
(i) | reduce its share capital; and |
(ii) | buy back Shares in itself, |
on any terms and at any time.
IperionX Limited
Page 2 |
(b) | The method of distribution of a reduction of the share capital of the Company may include any or all of the payment of cash, the issue of shares, the grant of Company options or other Company securities, the distribution of securities in any other body corporate or the transfer of any other assets. |
(c) | If a distribution of a reduction of the share capital of the Company includes a distribution of shares or other securities in another body corporate: |
(i) | each Member is deemed to have agreed to become a member of that body corporate and be bound by the constitution of that body corporate; and |
(ii) | each Member appoints the Company and each Director as its agent to execute an instrument of transfer or other document required to give effect to the distribution transfer those shares or other securities to that Member; and |
(iii) | any binding or notification between the Member and the Company (including any instructions relating to payment of dividends or to communications from the Company) will be deemed to be a similarly binding instruction or notification to the other body corporate until that instruction or notification is revoked or amended in writing addressed to the other body corporate (to the maximum extent permitted under Australian law, or the other body corporate's constitution). |
2.6 | Ancillary powers regarding distributions |
Instead of making a distribution or issue of specific assets, shares, debentures or other securities to a particular Member, the Directors may make a cash payment to that Member, or allocate some or all of the assets, shares, debentures or other securities to a trustee or nominee to be sold (at the Member's risk and expense, including as to brokerage and withholding tax) on behalf of, and for the benefit of, or in respect of, that Member, if:
(a) | the distribution or issue would otherwise be illegal or unlawful; |
(b) | the distribution or issue would give rise to parcels of securities which do not constitute a Marketable Parcel; |
(c) | in the Directors' discretion, the distribution or issue would be unreasonable having regard to: |
(i) | the number of Members in the place where the distribution or issue would be made; and/or |
(ii) | the number and value of securities that would be offered; and/or |
(iii) | the cost of complying with the legal requirements, and requirements of a regulatory authority, in the place; or |
(d) | the Member so agrees. |
2.7 | Unmarketable parcels of Shares |
Schedule 4 applies and forms part of this constitution.
2.8 | Registered holder is absolute owner |
Except as required by Applicable Law, the Company is not required to recognise any interest in, or right in respect of, a Share except an absolute right of legal ownership of the Member registered as the holder of that Share.
IperionX Limited
Page 3 |
2.9 | Holding statements and certificates |
(a) | The Directors will not, unless they determine otherwise or are required by any Applicable Law, issue a certificate to a Member for any Shares registered in the Member's name. |
(b) | The Company must issue to each Member, in accordance with Applicable Law, statements of the holdings of Shares registered in the Member's name. |
(c) | Any certificate for Shares must be issued and despatched in accordance with Applicable Law. |
(d) | If a Share is jointly held: |
(i) | the Company is not required to issue more than one certificate for that Share; and |
(ii) | delivery of a certificate for that Share to any one of the joint holders of that Share is delivery to all the joint holders. |
(e) | Subject to 2.9(a) the Company must issue a replacement certificate for a Share if the Company: |
(i) | receives and cancels the existing certificate; or |
(ii) | is satisfied that the existing certificate is lost or destroyed, and the Member complies with all conditions set out in the Corporations Act and pays any fee as the Directors resolve. |
3 | Restricted Securities |
The Company shall comply in all respects with the requirements of the Listing Rules with respect to restricted securities and the following provisions apply:
(a) | the Company must refuse to acknowledge a disposal (including registering a transfer) of restricted securities during the escrow period for those securities except as permitted by the Listing Rules or ASX; |
(b) | Members must not dispose of restricted securities during the escrow period for those securities except as permitted by the Listing Rules or ASX; |
(c) | if the restricted securities are in the same class as quoted securities, the holder will be taken to have agreed in writing that the restricted securities are to be kept on the Company's issuer sponsored sub-register and are to have a holding lock applied for the duration of the escrow period applicable to those securities; |
(d) | a holder of restricted securities will not be entitled to participate in any return of capital on those restricted securities during the escrow period applicable to those restricted securities except as permitted by the Listing Rules or ASX; and |
(e) | if a holder of restricted securities breaches a restriction deed or a provision of the constitution restricting a disposal of those restricted securities, the holder will not be entitled to any dividend or distribution or to exercise any voting rights, in respect of those restricted securities for so long as the breach continues. |
4 | Calls, Company Payments, Forfeiture and Liens |
Schedule 2 applies and forms part of this constitution.
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5 | Transfer of Shares |
5.1 | Electronic transfer systems |
The Company may do any act, matter or thing permitted under Applicable Law to facilitate involvement by the Company in any clearing and settlement facility provided under Applicable Law for the transfer of securities.
5.2 | Forms of transfer |
Subject to this constitution, a Member may transfer one or more Shares the Member holds by:
(a) | a proper ASX Settlement transfer; |
(b) | an instrument of transfer in compliance with this constitution; or |
(c) | any other method permitted by Applicable Law. |
5.3 | Instrument of transfer |
An instrument of transfer of a Share referred to in article 5.2(b) must be:
(a) | in writing; |
(b) | in any usual form or in any other form approved by the Directors that is otherwise permitted by law; |
(c) | subject to the Corporations Act, executed by or on behalf of the transferor, and if required by the Company, the transferee; |
(d) | stamped, if required by a law about stamp duty; and |
(e) | delivered to the Company, at the place where the Register is kept, together with the certificate (if any) of the Share to be transferred and any other evidence as the Directors require to prove: |
(i) | the title of the transferor to that Share; |
(ii) | the right of the transferor to transfer that Share; and |
(iii) | the proper execution of the instrument of transfer. |
5.4 | Transferor is holder until transfer registered |
Subject to the ASX Settlement Operating Rules, a person transferring a Share remains the registered holder of that Share until the transfer for that Share is registered and the name of the person to whom the Share is being transferred is entered in the Register as the holder of that Share.
5.5 | Refusal to register transfers |
(a) | Subject to: |
(i) | Applicable Law; |
(ii) | article 5.3 and articles 5.5(a) to 5.5(i) (inclusive); and |
(iii) | paragraph 2.1(c) of Schedule 2, |
the Company must not refuse or fail to register a transfer of Shares.
(b) | The Company may refuse to register a transfer of Shares where Applicable Law permits the Company to do so. |
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(c) | The Company must refuse to register a transfer of Shares where Applicable Law or a law about stamp duty requires the Company to do so. |
(d) | Schedule 5 applies and forms part of this constitution. |
(e) | The Company may apply, or may ask ASX Settlement to apply, a holding lock (including to prevent a transfer, or to refuse to register a paper based transfer document) where Applicable Law permits the Company to do so. |
(f) | The Company must give Notice of any refusal to register a transfer of Shares, and the reasons for the refusal, to the person transferring those Shares and the person who lodged the transfer (if not the same person) within five Business Days after the date on which the transfer was lodged with the Company. |
(g) | The Company must give Notice of any holding lock, and the reasons for the holding lock, to the Member of those Shares within five Business Days after the date on which the Company asked for the holding lock. |
(h) | Failure by the Company to give Notice under article 5.5(f) or 5.5(g) does not invalidate the refusal to register the transfer or the holding lock. |
(i) | The powers of the Company under articles 5.5(b) and 5.5(e) may only be exercised by the Directors. |
5.6 | No registration fee |
The Company must not charge a fee to register a transfer of a Share in compliance with this constitution except as permitted by Applicable Law.
5.7 | Transmission of Shares |
Schedule 3 applies and forms part of this constitution.
6 | Proceeding of Members |
6.1 | Who can call meetings of Members |
(a) | The Directors may call a meeting of Members at a time and place as the Directors resolve. |
(b) | Subject to the Corporations Act, a Director may call a meeting of Members at a time and place as that Director determines. |
(c) | The Directors must call and arrange to hold a meeting of Members on the request of Members made in accordance with the Corporations Act. |
(d) | The Members may call and arrange to hold a meeting of Members as provided by the Corporations Act. |
6.2 | Annual general meeting |
The Company must hold an AGM if required by, and in accordance with, Applicable Law.
6.3 | How to call meetings of Members |
(a) | The Company must give not less than Prescribed Notice of a meeting of Members. |
(b) | Notice of a meeting of Members must be given to ASX, each Member, each Director, each Alternate Director and any auditor of the Company. |
(c) | Holders of preference Shares have the same rights as holders of ordinary Shares to: |
(i) | receive Notice of a meeting of Members; and |
(ii) | receive Notices, reports and financial reports of the Company. |
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(d) | Subject to article 6.13(h), a Notice of a meeting of Members must include: |
(i) | date and time for the meeting (and if the meeting is to be held in two or more places, the technology that will be used to facilitate this); |
(ii) | the general nature of the business of the meeting; |
(iii) | the date and time (being not more than 48 hours before the meeting) at which persons will be taken for the purposes of the meeting to hold Shares; and |
(iv) | any other information or documents specified by Applicable Law. |
(e) | A person may waive Notice of any meeting of Members by Notice to the Company to that effect. |
(f) | Anything done (including the passing of a resolution) at a meeting of Members is not invalid because either or both a person does not receive Notice of that meeting or the Company accidentally does not give Notice of that meeting to a person. |
6.4 | Right to attend meetings of Members |
(a) | Each Eligible Member and any auditor of the Company is entitled to attend any meetings of Members. |
(b) | Holders of preference Shares have the same rights as holders of ordinary Shares to attend a meeting of Members. |
(c) | Subject to this constitution, each Director is entitled to attend and speak at all meetings of Members. |
(d) | The chairperson of a meeting of Members may refuse any person's admission to, or require a person to leave and remain out of, the meeting if that person: |
(i) | in the opinion of the chairperson, is not complying with the reasonable directions of the chairperson; |
(ii) | has any audio or visual recording device; |
(iii) | has a placard or banner; |
(iv) | has an article the chairperson considers to be dangerous, offensive or liable to cause disruption; |
(v) | refuses to produce or to permit examination of any article, or the contents of any article, in the person's possession; |
(vi) | refuses to comply with a request to turn off a mobile telephone, personal communication or similar device; |
(vii) | behaves or threatens to behave, or who the chairperson has reasonable grounds to believe may behave, in a dangerous, offensive or disruptive manner; or |
(viii) | is not: |
(A) | an Eligible Member; |
(B) | a proxy, attorney or representative of an Eligible Member; |
(C) | a Director; or |
(D) | an auditor of the Company. |
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6.5 | Meeting of Members at more than one place |
(a) | A meeting of Members may be held in two or more places linked together by any technology that: |
(i) | gives the Eligible Members as a whole in those places a reasonable opportunity to participate in proceedings; |
(ii) | enables the chairperson of that meeting to be aware of proceedings in each place; and |
(iii) | enables the Eligible Members in each place to vote on a show of hands and on a poll. |
(b) | If a meeting of Members is held in two or more places under article 6.5(a): |
(i) | an Eligible Member present at one of the places is taken to be present at that meeting; and |
(ii) | that meeting will be deemed to be held at the place stated in the Notice of meeting, or, failing statement of a place in the Notice of meeting, as determined by the chairperson of that meeting. |
6.6 | Meeting of Member by Virtual Meeting |
A meeting of Member may be held virtually using any technology that gives Members as a whole a reasonable opportunity to participate in the meeting.
6.7 | Quorum |
(a) | Two Eligible Members present (including virtually) and entitled to vote at a meeting of Members constitute a quorum. |
(b) | In determining whether a quorum for a meeting of Members is present: |
(i) | where more than one proxy, attorney or representative of an Eligible Member is present, only one of those persons is counted; |
(ii) | where a person is present as an Eligible Member and as a proxy, attorney or representative of another Eligible Member, that person is counted separately for each appointment provided that there is at least one other Eligible Member present; and |
(iii) | where a person is present as a proxy, attorney or representative for more than one Eligible Member, that person is counted separately for each appointment provided that there is at least one other Eligible Member present. |
(c) | A quorum for a meeting of Members must be present at the commencement of that meeting. If a quorum is present at the commencement of a meeting of Members, it is taken to be present throughout that meeting unless the chairperson of that meeting otherwise determines. |
(d) | If a quorum is not present within 30 minutes after the time appointed for a meeting of Members: |
(i) | if that meeting was called under article 6.1(c) or article 6.1(d), that meeting is dissolved; and |
(ii) | any other meeting is adjourned to the date, time and place as the Directors may by Notice to the Members appoint, or failing any appointment, to the same day in the next week at the same time and place as that meeting adjourned. |
(iii) | If a quorum is not present within 30 minutes after the time appointed for an adjourned meeting of Members, that meeting is dissolved. |
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6.8 | Chairperson |
(a) | The chairperson of Directors (if any) must (if present within 15 minutes after the time appointed for the holding of the meeting and willing to act) chair each meeting of Members. |
(b) | If there is no chairperson of Directors or the chairperson of Directors will be unable to attend a meeting of Members or not willing to chair the meeting, the Directors may, by majority vote at any time prior to a meeting of Members, elect a person to chair a meeting of Members. |
(c) | If at a meeting of Members: |
(i) | there is no chairperson of Directors; |
(ii) | the chairperson of Directors is not present within 15 minutes after the time appointed for the holding of that meeting; or |
(iii) | the chairperson of Directors is present within that time but is not willing to chair all or part of that meeting, |
the Directors present may, by majority vote, elect a person present to chair all or part of that meeting.
(d) | Subject to articles 6.8(a) to 6.8(c) (inclusive), if at a meeting of Members: |
(i) | a chairperson of that meeting has not been elected by the Directors under article 6.8(a), 6.8(b) or 6.8(c); or |
(ii) | the chairperson of that meeting elected by the Directors is not willing to chair all or part of that meeting, |
the Eligible Members present must elect another person present and willing to act to chair all or part of that meeting.
6.9 | General conduct of meetings |
(a) | The chairperson of a meeting of Members (including any person acting with authority of the chairman): |
(i) | has charge of the general conduct of each meeting of Members and the procedures to be adopted at the meeting (including the procedure for the conduct of the election of Directors); |
(ii) | may require any person wishing to attend the meeting to comply with searches, restrictions or other security arrangements considered appropriate; |
(iii) | if there is insufficient room at the meeting venue, may arrange another or a second venue (without giving notice or putting the matter to a vote), even if the Members present in the separate room are not able to participate in the conduct of the meeting, the meeting will nevertheless be treated as validly held in the main room; |
(iv) | may make rulings or adjourn a meeting of Members without putting the question (or any question) to the vote if that action is required to ensure the orderly conduct of that meeting |
(v) | may require the adoption of any procedure which is in the chairman's opinion necessary or desirable for proper and orderly debate or discussion and the proper and orderly casting or recording of votes at the meeting of Members; |
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(vi) | determine any dispute concerning the admission, validity or rejection of a vote at that meeting; |
(vii) | terminate debate or discussion on any matter being considered at that meeting and require that matter be put to a vote; |
(viii) | refuse to allow debate or discussion on any matter which is not business referred to in the Notice of that meeting or is not business allowed to be discussed in accordance with the Corporations Act; |
(ix) | subject to the Corporations Act, refuse to allow any amendment to be moved to a resolution set out in the Notice of that meeting; |
(x) | may withdraw from consideration by the meeting any resolution that is set out in the notice of that meeting (other than those requisitioned by Members or required by law); and |
(xi) | determine who may speak at that meeting. |
(b) | A decision by the chairman under article 6.9(a) (including any person acting with the chairman's authority) is final. |
(c) | The powers conferred on the chairperson of a meeting of Members under article 6.9(a) do not limit the powers conferred by law. |
6.10 | Resolutions of Members |
(a) | A resolution at a meeting of Members is passed if the number of votes cast in favour of the resolution by Members entitled to vote on the resolution exceeds the number of votes cast against the resolution by Members entitled to vote on the resolution. |
(b) | Unless a poll is requested in accordance with articles 6.12(a) and 6.12(h) (inclusive), a resolution put to the vote at a meeting of Members must be decided on a show of hands. |
(c) | A declaration by the chairperson of a meeting of Members that a resolution on a show of hands is passed, passed by a particular majority, or not passed, and an entry to that effect in the minutes of that meeting, are sufficient evidence of that fact, unless proved incorrect. |
6.11 | Direct Voting |
(a) | The Directors may determine that at any meeting of Members or class meeting, a Member who is entitled to attend and vote on a resolution at that meeting is entitled a direct vote in respect of that resolution. A "direct vote" includes a vote delivered to the Company by post, fax or other electronic means approved by Directors. The Directors may prescribe rules to govern direct voting including specifications as to the form, method and timing of giving the direct vote in order for the vote to be valid, and the treatment of direct votes. |
(b) | A direct vote on a resolution at a meeting in respect of a share cast in accordance with article 6.11(a) is of no effect and will be disregarded: |
(i) | if, at the time of the resolution, the person who cast the direct vote: |
(A) | is not entitled to vote on the resolution in respect of the share; or |
(B) | would not be entitled to vote on the resolution in respect of the share if the person were present at the meeting at which the resolution is considered; |
(ii) | if, had the vote been cast in person at the meeting at which the resolution is considered: |
(A) | the vote would not be valid; or |
(B) | the Company would be obliged to disregard the vote; |
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(iii) | subject to any rules prescribed by the Directors, if the person who cast the direct vote is present in person at the meeting at any time the resolution is considered; and |
(iv) | if the direct vote was cast otherwise than in accordance with any regulations, rules and procedures prescribed by the Directors under article 6.11(a). |
(c) | Subject to any rules prescribed by the Directors, if the Company receives a valid direct vote on a resolution in accordance with articles 6.11(a) and 6.11(b) and, prior to, after or at the same time as receipt of the direct vote, the Company receives an instrument appointing a proxy, attorney or Personal Representative to vote on behalf of the same Member on that resolution, the Company may regard the direct vote as effective in respect of that resolution and disregard any vote cast by the proxy, attorney or Personal Representative on the resolution at the meeting. |
6.12 | Polls |
(a) | A poll may be demanded on any resolution at a meeting of Members. |
(b) | A poll on a resolution at a meeting of Members may be demanded by: |
(i) | at least five Eligible Members present and entitled to vote on that resolution; |
(ii) | one or more Eligible Members present and who are together entitled to at least five per cent of the votes that may be cast on that resolution on a poll; or |
(iii) | the chairperson of that meeting. |
(c) | A poll on a resolution at a meeting of Members may be demanded: |
(i) | before a vote on that resolution is taken; or |
(ii) | before or immediately after the results of the vote on that resolution on a show of hands are declared. |
(d) | A demand for a poll may be withdrawn. |
(e) | A poll demanded on a resolution at a meeting of Members other than for the election of a chairperson of that meeting or the adjournment of that meeting must be taken in the manner and at the time and place the chairperson directs. |
(f) | A poll demanded on a resolution at a meeting of Members for the election of a chairperson of that meeting or the adjournment of that meeting must be taken immediately. |
(g) | The result of a poll demanded on a resolution of a meeting of Members is a resolution of that meeting. |
(h) | A demand for a poll on a resolution of a meeting of Members does not prevent the continuance of that meeting or that meeting dealing with any other business. |
6.13 | Adjourned, cancelled and postponed meetings |
(a) | The chairperson of a meeting of Members: |
(i) | may adjourn that meeting to any day, time and place; and |
(ii) | must adjourn that meeting if the Eligible Members present with a majority of votes that may be cast at that meeting agree or direct the chairperson to do so. The chairperson may adjourn that meeting to any day, time and place. |
The chairman may, but is not required to, seek consent of the meeting to the adjournment.
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(b) | No person other than the chairperson of a meeting of Members may adjourn that meeting. |
(c) | The Company is only required to give Notice of a meeting of Members resumed from an adjourned meeting if the period of adjournment exceeds 28 days. |
(d) | Only business left unfinished is to be transacted at a meeting of Members resumed after an adjournment. |
(e) | Subject to articles 6.13(a) to 6.13(h) (inclusive), the Directors may at any time postpone or cancel a meeting of Members by: |
(i) | the Directors passing a resolution to postpone or cancel that meeting, with such postponement or cancellation taking effect upon the Directors passing that resolution; |
(ii) | giving Notice as soon as practicable to ASX (or, if the Company is not admitted to the Official List at the relevant time, by other publication) of the postponement or cancellation of that meeting ; and |
(iii) | giving Notice as soon as practicable to each person who is, at the date of the Notice: |
(A) | a Member; |
(B) | a Director or Alternate Director; or |
(C) | an auditor of the Company. |
(f) | A meeting of Members called under article 6.1(c) must not be cancelled by the Directors without the consent of the Members who requested that meeting. |
(g) | A meeting of Members called under article 6.1(d) must not be cancelled or postponed by the Directors without the consent of the Members who called that meeting. |
(h) | A Notice under article 6.13(c) of a meeting of Members resumed from an adjourned meeting and a Notice under article 6.13(e)(iii) postponing a meeting of Members must set out the place, date and time for the revised meeting (and if the revised meeting is to be held in two or more places, the technology that will be used to facilitate this). |
6.14 | Number of votes |
(a) | Subject to this constitution and any rights or restrictions attached to a class of Shares, on a show of hands at a meeting of Members, every Eligible Member present has one vote. |
(b) | Subject to this constitution and any rights or restrictions attached to a class of Shares, on a poll at a meeting of Members, every Eligible Member present has: |
(i) | one vote for each fully paid up Share (whether the issue price of the Share was paid up or credited or both) that the Eligible Member holds; and |
(ii) | a fraction of one vote for each partly paid up Share that the Eligible Member holds. The fraction is equal to the proportion which the amount paid up on that Share (excluding amounts credited) is to the total amounts paid up and payable (excluding amounts credited) on that Share. |
(c) | Amounts paid in advance of a call on a Share are ignored when calculating the proportion under article 6.14(b)(ii). |
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(d) | If the total number of votes to which an Eligible Member is entitled on a poll does not constitute a whole number, the Company must disregard the fractional part of that total. |
(e) | If a Share is held jointly and more than one Member votes in respect of that Share, only the vote of the Member whose name appears first in the Register counts. |
(f) | A person may vote in respect of a Share at a meeting of Members if: |
(i) | the person is entitled to be registered as the holder of that Share because of a Transmission Event; and |
(ii) | the person satisfied the Directors of that entitlement not less than 48 hours before that meeting. |
(g) | A Member who holds restricted securities is not entitled to any voting rights in respect of those restricted securities during: |
(i) | a breach of the Listing Rules relating to those restricted securities; or |
(ii) | a breach of a restriction agreement. |
(h) | An Eligible Member present at a meeting of Members is not entitled to vote on any resolution in respect of any Shares on which any calls due and payable in respect of those Shares have not been paid. |
(i) | An Eligible Member present at a meeting of Members is not entitled to vote on a resolution at that meeting where that vote is prohibited by Applicable Law, an order of a court of competent jurisdiction or ASX. |
(j) | The Company must disregard any vote on a resolution purported to be cast by a Member present at a meeting of Members where that person is not entitled to vote on that resolution. |
(k) | The authority of any proxy or attorney for an Eligible Member to speak or vote at a meeting of Members in respect of the Shares to which the authority relates is suspended while the Eligible Member is present in person at that meeting. |
(l) | If more than one proxy, or more than one attorney authorised to speak or vote at a meeting of Members in respect of a Share is present at a meeting of Members: |
(i) | none of them is entitled to vote on a show of hands; and |
(ii) | on a poll, the vote of each one is of no effect where the aggregate number or proportion of the Eligible Member's votes for which they have been appointed exceeds the total number or proportion of votes that could be cast by the Eligible Member. |
6.15 | Objections to qualification to vote |
(a) | An objection to the qualification of any person to vote at a meeting of Members may only be made: |
(i) | before that meeting, to the Directors; or |
(ii) | at that meeting (or any resumed meeting if that meeting is adjourned), to the chairperson of that meeting. |
(b) | Any objection under article 6.15(a) must be decided by the Directors or the chairperson of the meeting of Members (as the case may be), whose decision, made in good faith, is final and conclusive. |
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6.16 | Proxies, attorneys and representatives |
(a) | An Eligible Member, who is entitled to attend and cast a vote at a meeting of Members, may vote on a show of hands and on a poll: |
(i) | in person or, if the Member is a body corporate, by its representative appointed in accordance with the Corporations Act; |
(ii) | by proxy or, if the Member is entitled to cast two or more votes at that meeting, by not more than two proxies; or |
(iii) | by attorney or, if the Member is entitled to cast two or more votes at that meeting, by not more than two attorneys. |
(b) | A proxy, attorney or representative of a Member need not be a Member. |
(c) | A Member may appoint a proxy, attorney or representative for: |
(i) | all or any number of meetings of Members; or |
(ii) | a particular meeting of Members. |
(d) | A proxy is valid if: |
(i) | the proxy instrument is signed by the Member making the appointment which contains: |
(A) | the name and address of that Member; |
(B) | the name of the Company; |
(C) | the name of the proxy or the name of the office of the proxy; and |
(D) | the meetings of Members at which the proxy may be used; or |
(ii) | submitted by any electronic means approved by the Directors. |
(e) | The chairperson of a meeting of Members may determine that an instrument appointing a proxy is valid even if it contains only some of the information specified in article 6.16(d). |
(f) | The decision of the chairperson of a meeting of Members as to the validity of an instrument appointing a proxy, attorney or representative is final and conclusive. |
(g) | Unless otherwise provided in the Corporations Act or in the instrument appointing a proxy or attorney, a proxy or attorney may: |
(i) | agree to a meeting of Members being called by shorter Notice than is required by the Corporations Act or this constitution; |
(ii) | speak on any resolution at a meeting of Members on which the proxy or attorney may vote; |
(iii) | vote at a meeting of Members (but only to the extent allowed by the appointment); |
(iv) | demand or join in demanding a poll on any resolution at a meeting of Members on which the proxy or attorney may vote; and |
(v) | attend and vote at any meeting of Members which is rescheduled or adjourned. |
(h) | Unless otherwise provided in the instrument appointing a proxy or attorney, a proxy or attorney may vote on: |
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(i) | any amendment to a resolution on which the proxy or attorney may vote; |
(ii) | any motion not to put that resolution or any similar motion; and |
(iii) | any procedural motion relating to that resolution, including a motion to elect the chairperson of a meeting of Members, vacate the chair or adjourn that meeting, |
even if the appointment directs the proxy or attorney how to vote on that resolution.
(i) | The Company must only send a form of proxy to Eligible Members in respect of a meeting of Members which provides for the Eligible Member: |
(i) | to appoint proxies of the Eligible Member's choice, but may specify who is to be appointed as proxy if the Eligible Member does not choose; and |
(ii) | to vote for or against each resolution, and may also provide for the Eligible Member to abstain from voting on each resolution or for the proxy to exercise a discretion to vote for or against each resolution. |
(j) | If the name of the proxy or the name of the office of the proxy in a proxy form of an Eligible Member is not filled in, the proxy of that Eligible Member is: |
(i) | the person specified by the Company in the form of proxy in the case the Eligible Member does not choose; or |
(ii) | if no person is so specified, the chairperson of that meeting. |
(k) | An Eligible Member may specify the manner in which a proxy or attorney is to vote on a particular resolution at a meeting of Members. |
(l) | The appointment of a proxy or attorney by an Eligible Member may specify the proportion or number of the Eligible Member's votes that the proxy or attorney may exercise. |
(m) | If an Eligible Member appoints two persons as proxy or attorney, and the appointment does not specify the proportion or number of the Eligible Member's votes those persons may exercise, each of those persons may exercise one half of the votes of the Eligible Member. |
(n) | If the total number of votes to which a proxy or attorney is entitled to exercise does not constitute a whole number, the Company must disregard the fractional part of that total. |
(o) | An appointment of proxy or attorney for a meeting of Members is effective only if the Company receives the appointment (and any authority under which the appointment was signed or a certified copy of the authority) not less than: |
(i) | 48 hours before the time scheduled for commencement of that meeting; or |
(ii) | in the case of a meeting which has been adjourned or postponed, 48 hours before the time scheduled for resumption or commencement of that meeting. |
(p) | Unless the Company has received Notice of the matter not less than 48 hours before the time scheduled for the commencement of a meeting of Members, a vote cast at that meeting by a person appointed by an Eligible Member as a proxy, attorney or representative is, subject to this constitution valid even if, before the person votes: |
(i) | there is a Transmission Event in respect of that Eligible Member; |
(ii) | that Eligible Member revokes the appointment of that person; |
(iii) | that Eligible Member revokes the authority under which that person was appointed by a third party; or |
(iv) | that Eligible Member transfers the Shares in respect of which the appointment is made. |
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7 | Directors |
7.1 | Number of Directors |
(a) | The Company must have not less than three Directors. |
(b) | The Company may by ordinary resolution passed at a meeting of Members alter the maximum or minimum number of Directors provided that the minimum is not less than three. |
(c) | Subject to articles 7.1(a) to 7.1(d) (inclusive), the Directors must determine the number of Directors provided that the Directors cannot reduce the number of Directors below the number in office at the time that determination takes effect. |
(d) | If the number of Directors is below the minimum fixed by this constitution, the Directors must not act except in emergencies, for appointing one or more Directors in order to make up a quorum for a meeting of Directors, or to call and arrange to hold a meeting of Members. |
7.2 | Appointment of Directors |
(a) | The first Directors are the persons specified as Directors in the application for the registration of the Company under the Corporations Act. |
(b) | Subject to articles 7.1(a) to 7.1(d) (inclusive), the Directors may appoint any person as a Director. |
(c) | The Company may by ordinary resolution passed at a meeting of Members elect any person as a Director. |
(d) | A Director need not be a Member. |
(e) | The Company must hold an election of Directors each year. |
(f) | The Company must accept nominations for the election of a Director in the case of a meeting of Members called under article 6.1(c), 30 Business Days, or otherwise, 35 Business Days, before the date of the meeting of Members at which the Director may be elected. |
(g) | A nomination of a person for Director (other than a Director retiring in accordance with this constitution) must be: |
(i) | in writing; |
(ii) | signed by a Member entitled to attend and vote at the meeting of Members at which the election is proposed; |
(iii) | accompanied by a Notice signed by the nominee consenting to the nomination; and |
(iv) | lodged with the Company at its registered office. |
7.3 | Retirement of Directors and vacation of office |
(a) | Articles 7.3(b) to 7.3(d) (inclusive) and articles 7.3(i) and 7.3(j) do not apply to the managing director of the Company, or if more than one, the managing director of the Company determined by the Directors. |
(b) | A Director must retire from office no later than the longer of: |
(i) | the third AGM; or |
(ii) | three years following that Director's last election or appointment. |
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(c) | If the Company has three or more Directors, one third of the Directors (excluding Directors required to retire under article 7.3(j) and rounded down to the nearest whole number) must retire at each AGM. |
(d) | If the Company has less than three Directors, one Director must retire at each AGM. |
(e) | The Directors to retire under articles 7.3(c) and 7.3(d) are: |
(i) | those who have held their office as Director the longest period of time since their last election or appointment to that office; and |
(ii) | if two or more Directors have held office for the same period of time, those Directors determined by lot, unless those Directors agree otherwise. |
(f) | A Director who retires under articles 7.3(b) to 7.3(d) (inclusive) or article 7.3(l) is eligible for re election. |
(g) | A Director may resign from office by giving the Company Notice. |
(h) | The Company may by ordinary resolution passed at a meeting of Members remove any Director, and if thought fit, appoint another person in place of that Director. |
(i) | A Director appointed under article 7.2(b) may retire at the next meeting of Members and is eligible for election at that meeting. |
(j) | Unless a Director appointed under article 7.2(b) has retired under article 7.3(i), that Director must retire at the next AGM, and is eligible for re election at that meeting. |
(k) | A Director ceases to hold office immediately if: |
(i) | the Director becomes mentally unfit to hold office, or the Director or his or her affairs are made subject to any law relating to mental health or incompetence; |
(ii) | without the consent of the other Directors, the Director is absent from all meetings of the Directors held during a period of six months; |
(iii) | the Director resigns or is removed under this constitution; |
(iv) | the Director is an Executive Director (including a managing director) and ceases and continues not to be to be an employee of the Company or of a related body corporate of the Company (not including being a Non Executive Director); |
(v) | the Director becomes bankrupt; or |
(vi) | the Director becomes disqualified by law from being a Director or the Corporations Act otherwise provides. |
(l) | A Director who ceases to be the managing director must retire at the next AGM following the Director ceasing to be managing director. |
7.4 | Alternate Directors |
(a) | With the approval of a majority of the other Directors, a Director may appoint a person as an Alternate Director of that Director for any period. |
(b) | An Alternate Director need not be a Member. |
(c) | The appointing Director may terminate the appointment of his or her Alternate Director at any time. |
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(d) | A Notice of appointment, or termination of appointment, of an Alternate Director is effective only if: |
(i) | the Notice is in writing; |
(ii) | the Notice is signed by the Director who appointed that Alternate Director; |
(iii) | the Company is given a copy of the Notice; and |
(iv) | in the case of an appointment of an Alternate Director, the Alternate Director has provided their written consent to act as an Alternate Director. |
(e) | If the Director who appointed an Alternate Director is not present at a meeting of Directors, that Alternate Director may, subject to this constitution and Applicable Law: |
(i) | attend, count in the quorum of, speak at, and vote at that meeting in place of that appointing Director; and |
(ii) | exercise any other powers (except the power under article 7.4(a)) that the appointing Director may exercise. |
(f) | An Alternate Director cannot exercise any powers of his or her appointing Director if that appointing Director ceases to be a Director. |
(g) | A person does not cease to be a Director under article 7.4(f) if that person retires as a Director at a meeting of Members and is re elected as a Director at that meeting. |
(h) | Subject to article 7.5(g), the Company is not required to pay any remuneration to an Alternate Director. |
(i) | An Alternate Director is an officer of the Company and not an agent of his or her appointing Director. |
7.5 | Remuneration of Directors |
(a) | The Company may pay to the Non Executive Directors a maximum total amount of Director's fees, determined by the Company in a meeting of Members, or until so determined, as the Directors resolve. |
(b) | The remuneration of the Non Executive Directors must not be calculated as a commission on, or percentage of, profits or operating revenue. |
(c) | The Directors may determine the manner in which all or part of the amount in article 7.5(a) is divided between the Non Executive Directors, or until so determined, the amount in article 7.5(a) must be divided between the Non Executive Directors equally. |
(d) | The remuneration of the Non Executive Directors is taken to accrue from day to day. |
(e) | The remuneration of the Executive Directors: |
(i) | must, subject to the provisions of any contract between each of them and the Company, be fixed by the Directors; and |
(ii) | must not be calculated as a commission on, or percentage of, operating revenue. |
(f) | If a Director performs extra or special services, including being: |
(i) | a member on a committee of Directors; or |
(ii) | the chairperson of Directors or deputy chairperson of Directors, |
the Company may, subject to articles 7.5(a) to 7.5(i) (inclusive), pay additional remuneration or provide benefits to that Director as the Directors resolve.
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(g) | The Company must pay all reasonable travelling, accommodation and other expenses that a Director or Alternate Director properly incurs: |
(i) | in attending meetings of Directors or any meetings of committees of Directors; |
(ii) | in attending any meetings of Members; and |
(iii) | in connection with the business of the Company. |
(h) | Any Director may participate in any fund, trust or scheme for the benefit of: |
(i) | past or present employees or Directors of the Company or a related body corporate of the Company; or |
(ii) | the dependants of, or persons connected with, any person referred to in article 7.5(h)(i). |
(i) | The Company may give, or agree to give, a person a benefit in connection with that person's, or someone else's, retirement from a board or managerial office in the Company or a related body corporate of the Company. |
7.6 | Interests of Directors |
(a) | A Director may: |
(i) | hold an office or place of profit (except as auditor) in the Company, on any terms as the Directors resolve; |
(ii) | hold an office or otherwise be interested in any related body corporate of the Company or other body corporate in which the Company is interested; or |
(iii) | act, or the Director's firm may act, in any professional capacity for the Company (except as auditor) or any related body corporate of the Company or other body corporate in which the Company is interested, |
and retain the benefits of doing so if the Director discloses in accordance with the Corporations Act the interest giving rise to those benefits.
(b) | If a Director discloses the interest of the Director in accordance with the Corporations Act: |
(i) | the Director may 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) | the Director may, subject to the Corporations Act, be counted in a quorum for a meeting of Directors considering the contract or arrangement; |
(iii) | the Director may, subject to Applicable Law, vote on whether the Company enters into the contract or arrangement, and on any matter that relates to the contract or arrangement; |
(iv) | the Director may 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) | the Director may retain the benefits under the contract or arrangement; and |
(vi) | the Company cannot avoid the contract or arrangement merely because of the existence of the Director's interest. |
(c) | The Director must give to the Company: |
(i) | at its registered office; or |
(ii) | any other place the Company reasonably notifies the Director in writing, |
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the information which the Company is required by the Listing Rules to disclose to ASX in respect of:
(iii) | Notifiable Interests of the Director; and |
(iv) | changes to the Notifiable Interests of the Director, |
in the form which the Company is required to tell ASX under the Listing Rules.
(d) | The information referred to in article 7.6(c) must be given to the Company as soon as reasonably possible after each of the following dates but in any event no later than three Business Days after each of the following dates: |
(i) | when the Director is appointed as a Director of the Company, the date of appointment; |
(ii) | when a change in a Notifiable Interest of the Director occurs, the date of the change; and |
(iii) | when the Director ceases to be a director of the Company, the date of cessation. |
(e) | Each Director authorises the Company to give the information provided by the Director under article 7.6(c) to ASX on the Director's behalf and as the Director's agent. |
(f) | The Company may enforce after the date a person ceases to be a Director an obligation of that person under article 7.6(c) in respect of events which occurred on or prior to the date that person ceased to be a Director. |
8 | Officers |
8.1 | Managing director |
(a) | The Directors may appoint one or more of themselves as a managing director, for any period and on any terms (including as to remuneration) as the Directors resolve. |
(b) | Subject to any agreement between the Company and a managing director and without prejudice to any other article in this constitution, the Directors may remove or dismiss a managing director (without removing him as a Director) at any time, with or without cause. |
(c) | The Directors may delegate any of their powers (including the power to delegate) to a managing director. |
(d) | The Directors may revoke or vary: |
(i) | the appointment of a managing director; or |
(ii) | any power delegated to a managing director, |
without removing him as a Director.
(e) | A managing director must exercise the powers delegated to him or her in accordance with any directions of the Directors. |
(f) | The exercise of a delegated power by a managing director is as effective as if the Directors exercised the power. |
(g) | A person ceases to be a managing director if the person ceases to be a Director. |
(h) | Subject to article 7.3(k)(iv), removal as managing director under this article 8 does not remove the managing director as a Director. |
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8.2 | Secretary |
(a) | The first Secretary is the person specified in the application for registration of the Company as company secretary. |
(b) | The Directors may appoint one or more Secretaries, for any period and on any terms (including as to remuneration) as the Directors resolve. |
(c) | Subject to any agreement between the Company and a Secretary, the Directors may remove or dismiss a Secretary at any time, with or without cause. |
(d) | The Directors may revoke or vary the appointment of a Secretary. |
8.3 | Indemnity and insurance |
(a) | To the extent permitted by law, the Company must indemnify each Relevant Officer against: |
(i) | a Liability of that person; and |
(ii) | Legal Costs of that person. |
(b) | To the extent permitted by law, the Company may make a payment (whether by way of advance, loan or otherwise) to a Relevant Officer in respect of Legal Costs of that person. |
(c) | To the extent permitted by law, the Company may pay, or agree to pay, a premium for a contract insuring a Relevant Officer against: |
(i) | a Liability of that person; and |
(ii) | Legal Costs of that person. |
(d) | To the extent permitted by law, the Company may enter into an agreement or deed with: |
(i) | a Relevant Officer; or |
(ii) | a person who is, or has been an officer of the Company or a subsidiary of the Company, |
under which the Company must do all or any of the following:
(iii) | keep books of the Company and allow either or both that person and that person's advisers access to those books on the terms agreed; |
(iv) | indemnify that person against any Liability of that person; |
(v) | make a payment (whether by way of advance, loan or otherwise) to that person in respect of Legal Costs of that person; and |
(vi) | keep that person insured in respect of any act or omission by that person while a Relevant Officer or an officer of the Company or a subsidiary of the Company, on the terms agreed (including as to payment of all or part of the premium for the contract of insurance). |
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9 | Powers of the Company and Directors |
9.1 | General powers |
(a) | The Company may exercise in any manner permitted by the Corporations Act any power which a public company limited by shares may exercise under the Corporations Act. |
(b) | The business of the Company is managed by or under the direction of the Directors. |
(c) | The Directors may exercise all the powers of the Company except any powers that the Corporations Act or this constitution requires the Company to exercise in meetings of Members. |
9.2 | Execution of documents |
(a) | If the Company has a common seal, the Company may execute a document if that seal is fixed to the document and the fixing of that seal is witnessed by: |
(i) | two Directors; |
(ii) | a Director and a Secretary; or |
(iii) | a Director and another person appointed by the Directors for that purpose. |
(b) | The Company may execute a document without a common seal if the document is signed by: |
(i) | two Directors; |
(ii) | a Director and a Secretary; or |
(iii) | a Director and another person appointed by the Directors for that purpose. |
(c) | The Company may execute a document as a deed if the document is expressed to be executed as a deed and is executed in accordance with article 9.2(a) or 9.2(b). |
(d) | The Directors may resolve, generally or in a particular case, that any signature on certificates for securities of the Company may be affixed by mechanical or other means. |
(e) | Negotiable instruments may be signed, drawn, accepted, endorsed or otherwise executed by or on behalf of the Company in the manner and by the persons as the Directors resolve. |
9.3 | Committees and delegates |
(a) | The Directors may delegate any of their powers (including this power to delegate) to a committee of Directors, a Director, an employee of the Company or any other person. |
(b) | The Directors may revoke or vary any power delegated under article 9.3(a). |
(c) | A committee or delegate must exercise the powers delegated in accordance with any directions of the Directors. |
(d) | The exercise of a delegated power by the committee or delegate is as effective as if the Directors exercised the power. |
(e) | Article 10 applies with the necessary changes to meetings of a committee of Directors. |
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9.4 | Attorney or agent |
(a) | The Directors may appoint any person to be attorney or agent of the Company for any purpose, for any period and on any terms (including as to remuneration) as the Directors resolve. |
(b) | The Directors may delegate any of their powers (including the power to delegate) to an attorney or agent. |
(c) | The Directors may revoke or vary: |
(i) | an appointment under article 9.4(a); or |
(ii) | any power delegated to an attorney or agent. |
10 | Proceedings of Directors |
10.1 | Written resolutions of Directors |
(a) | The Directors may pass a resolution without a meeting of the Directors being held if all of the Directors entitled to vote on the resolution assent to a document containing a statement that they are in favour of the resolution set out in the document. For the avoidance of doubt, a Director who is prohibited from voting on a resolution pursuant to section 195(1)(b) of the Corporations Act will, for the purposes of this article 10.1(a), not be entitled to vote on such resolution. |
(b) | Separate copies of the document referred to in article 10.1(a) may be used for assenting to by Directors if the wording of the resolution and the statement is identical in each copy. |
(c) | A Director may signify assent to a document under articles 10.1(a) to 10.1(e) (inclusive) by signing the document or by notifying the Company of the assent of the Director: |
(i) | in a manner permitted by article 12.3; or |
(ii) | by any technology including telephone or email. |
(d) | Where a Director signifies assent to a document under article 10.1(c) other than by signing the document, the Director must by way of confirmation sign the document before or at the next meeting of Directors attended by that Director. |
(e) | The resolution the subject of a document under article 10.1(a) is not invalid if a Director does not comply with article 10.1(d). |
10.2 | Meetings of Directors |
(a) | The Directors may meet, adjourn and otherwise regulate their meetings as they think fit. |
(b) | A meeting of Directors may be held using any technology. |
(c) | If a meeting of Directors is held in two or more places linked together by any technology: |
(i) | a Director present at one of the places is taken to be present at the meeting unless and until the Director states to the chairperson of that meeting that the Director is discontinuing her or her participation in that meeting; and |
(ii) | the chairperson of that meeting may determine at which place the meeting will be taken to have been held. |
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10.3 | Who can call meetings of Directors |
(a) | A Director may call a meeting of Directors at any time. |
(b) | On request of any Director, a Secretary of the Company must call a meeting of the Directors. |
10.4 | How to call meetings of Directors |
(a) | Notice of a meeting of Directors must be given to each Director and Alternate Director. |
(b) | The Company must give not less than 12 hours' Notice of a meeting of Directors, unless all Directors agree otherwise. |
(c) | A Director or Alternate Director may waive Notice of a meeting of Directors by Notice in writing to the Company to that effect. |
10.5 | Quorum |
(a) | Subject to the Corporations Act, a quorum for a meeting of Directors is: |
(i) | if the Directors have fixed a number for the quorum, that number of Directors; and |
(ii) | in any other case, two Directors entitled to vote on a resolution that may be proposed at that meeting. |
(b) | In determining whether a quorum for a meeting of Directors is present: |
(i) | where a Director has appointed an Alternate Director, that Alternate Director is counted if the appointing Director is not present; |
(ii) | where a person is present as Director and an Alternate Director for another Director, that person is counted separately provided that there is at least one other Director or Alternate Director present; and |
(iii) | where a person is present as an Alternate Director for more than one Director, that person is counted separately for each appointment provided that there is at least one other Director or Alternate Director present. |
(c) | A quorum for a meeting of Directors must be present at all times during the meeting. |
(d) | If there are not enough persons to form a quorum for a meeting of Directors, one or more of the Directors (including those who have an interest in a matter being considered at that meeting) may call a meeting of Members and the Members may pass a resolution to deal with the matter. |
10.6 | Chairperson |
(a) | Subject to article 10.6(b), the Directors may elect a Director as chairperson of Directors or deputy chairperson of Directors for any period they resolve, or if no period is specified, until that person ceases to be a Director. |
(b) | The Directors may remove the chairperson of Directors or deputy chairperson of Directors at any time. |
(c) | The chairperson of Directors must (if present within 15 minutes after the time appointed for the holding of the meeting and willing to act) chair each meeting of Directors. |
(d) | If: |
(i) | there is no chairperson of Directors; or |
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(ii) | the chairperson of Directors is not present within 15 minutes after the time appointed for the holding of a meeting of Directors; or |
(iii) | the chairperson of Directors is present within that time but is not willing to chair all or part of that meeting, |
then if the Directors have elected a deputy chairperson of Directors, the deputy chairperson of Directors must (if present within 15 minutes after the time appointed for the holding of the meeting and willing to act) chair all or part of the meeting of Directors.
(e) | Subject to articles 10.6(c) and 10.6(d), if: |
(i) | there is no deputy chairperson of Directors; or |
(ii) | the deputy chairperson of Directors is not present within 15 minutes after the time appointed for the holding of a meeting of Directors; or |
(iii) | the deputy chairperson of Directors is present within that time but is not willing to chair all or part of that meeting, |
the Directors present must elect one of themselves to chair all or part of the meeting of Directors.
(f) | A person does not cease to be a chairperson of Directors or deputy chairperson of Directors if that person retires as a Director at a meeting of Members and is re elected as a Director at that meeting. |
10.7 | Resolutions of Directors |
(a) | A resolution of Directors is passed if more votes are cast in favour of the resolution than against it. |
(b) | Subject to article 7.6(a) to 7.6(f) (inclusive) and articles 10.7(a) to 10.7(d) (inclusive), each Director has one vote on a matter arising at a meeting of the Directors. |
(c) | In determining the number of votes a Director has on a matter arising at a meeting of Directors: |
(i) | where a person is present as Director and an Alternate Director for another Director, that person has one vote as a Director and, subject to article 7.4(e), one vote as an Alternate Director; and |
(ii) | where a person is present as an Alternate Director for more than one Director, that person has, subject to article 7.4(e), one vote for each appointment. |
(d) | Subject to Applicable Law, in case of an equality of votes on a resolution at a meeting of Directors, the chairperson of that meeting has a casting vote on that resolution in addition to any vote the chairperson has in his or her capacity as a Director in respect of that resolution. |
11 | Dividends and Profits |
11.1 | Who may determine Dividends |
(a) | Subject to and in accordance with the Corporations Act, the Listing Rules, the rights of any preference Shares and to the rights of the holders of any Shares created or raised under any special arrangement as to Dividend, the Directors may from time to time declare a Dividend to be paid to the shareholders entitled to the Dividend. Subject to the rights of any preference Shares and to the rights of the holders of any Shares created or raised under any special arrangement as to a Dividend, the Dividend as declared will be payable on all Shares according to the proportion that the amount paid (not credited) is of the total amounts paid and payable (excluding amounts credited) in respect of such Shares. |
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(b) | The Directors may determine that a Dividend is payable on Shares and fix: |
(i) | the amount of the Dividend; |
(ii) | whether the Dividend is franked, the franking percentage and the franking class; |
(iii) | the time for determining entitlements to the Dividend; |
(iv) | the time for the payment of the Dividend; and |
(v) | the method of payment of the Dividend. |
(c) | The method of payment of a Dividend may include any or all of the payment of cash, the issue of Shares, the grant of Company options or other Company securities, the transfer of shares or any other securities in any other body corporate or units in any unit trust or the transfer of any other assets. |
(d) | If the method of payment of a Dividend includes an issue or transfer of shares in a body corporate, each Member: |
(i) | is deemed to have agreed to become a member of that body corporate and be bound by the constitution of that body corporate; and |
(ii) | in the case of a transfer, appoints the Company and each Director as its agent to execute instrument of transfer or other document required to transfer those shares to that Member. |
(e) | A Dividend in respect of a Share must be paid to the person whose name is entered in the Register as the holder of that Share: |
(i) | where the Directors have fixed a time under article 11.1(b)(iii), at that time; or |
(ii) | in any other case, on the date the Dividend is paid. |
(f) | Subject to article 11.1(g), a Member who holds restricted securities is entitled to any Dividends in respect of those restricted securities. |
(g) | A Member who holds restricted securities is not entitled to any Dividends in respect of those restricted securities during a breach of: |
(i) | the Listing Rules relating to those restricted securities; or |
(ii) | a restriction agreement. |
11.2 | Dividends for different classes |
The Directors may determine that Dividends be paid:
(a) | on Shares of one class but not another class; and |
(b) | at different rates for different classes of Shares. |
11.3 | Dividends proportional to paid up capital |
(a) | Subject to any rights or restrictions attached to a class of Shares, the person entitled to a Dividend on a Share is entitled to: |
(i) | if the Share is fully paid (whether the issue price of the Share was paid or credited or both), the entire Dividend; or |
(ii) | if the Share is partly paid, a proportion of that Dividend equal to the proportion which the amount paid (excluding amounts credited) on that Share is of the total amounts paid or payable (excluding amounts credited) on that Share. |
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(b) | Amounts paid in advance of a call on a Share are ignored when calculating the proportion under article 11.3(a)(ii). |
11.4 | Effect of a transfer on Dividends |
If a transfer of a Share is registered after the time determined for entitlements to a Dividend on that Share but before the Dividend is paid, the person transferring that Share is, subject to the ASX Settlement Operating Rules, entitled to that Dividend.
11.5 | No interest on Dividends |
The Company is not required to pay any interest on a Dividend.
11.6 | Unpaid amounts |
The Company may retain the whole or part of any Dividend on which the Company has a lien and apply that amount in total or part satisfaction of any amount secured by that lien.
11.7 | Capitalisation of profits |
(a) | The Directors may capitalise any profits of the Company and distribute that capital to the Members, in the same proportions as the Members are entitled to a distribution by Dividend. |
(b) | The Directors may fix the time for determining entitlements to a capitalisation of profits. |
(c) | The Directors may decide to apply capital under article 11.7(a) in either or both of the following ways: |
(i) | in paying up an amount unpaid on Shares already issued; and |
(ii) | in paying up in full any unissued Shares or other securities in the Company. |
(d) | The Members must accept an application of capital under article 11.7(c) in full satisfaction of their interests in that capital. |
11.8 | Distributions of assets |
The Directors may settle any problem concerning a distribution under article 11 in any way, including:
(a) | rounding amounts up or down to the nearest whole number; |
(b) | ignoring fractions; |
(c) | valuing assets for distribution; |
(d) | paying cash to any Member on the basis of that valuation; and |
(e) | vesting assets in a trustee on trust for the Members entitled. |
11.9 | Dividend plans |
(a) | The Directors may establish a dividend selection plan or bonus share plan on any terms, under which participants may elect in respect of all or part of their Shares: |
(i) | to receive a Dividend from the Company paid in whole or in part out of a particular fund or reserve or out of profits derived from a particular source; or |
(ii) | to forego a Dividend from the Company and receive some other form of distribution or entitlement (including securities) from the Company or another body corporate or a trust. |
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(b) | The Directors may establish a dividend reinvestment plan on any terms, under which participants may elect in respect of all or part of their Shares to apply the whole or any part of a Dividend from the Company in subscribing for securities of the Company or a related body corporate of the Company. |
(c) | Subject to the Listing Rules, the Directors may implement, amend, suspend or terminate a plan established under articles 11.9(a) to 11.9(c) (inclusive). |
12 | Notices and Payments |
12.1 | Notice to Members |
(a) | The Company may give Notice to a Member: |
(i) | in person; |
(ii) | by sending it by post to the address of the Member in the Register or the alternative address (if any) nominated by that Member; |
(iii) | by sending it to the fax number or electronic address (if any) nominated by that Member; or |
(iv) | by notifying the Member by any electronic means nominated by the Member: |
(A) | that the Notice is available; and |
(B) | how the Member may access the Notice; |
(v) | by posting (pursuant to rule 12.1(a)(ii)) or faxing (pursuant to 12.1(a)(iii)), a document notifying the Member: |
(A) | that the Notice is available; and |
(B) | how the Member may access the Notice; or |
(vi) | such other means as permitted by the Corporations Act. |
(b) | If the address of a Member in the Register is not within Australia, the Company must send all documents to that Member by air mail, air courier, fax or by electronic means. |
(c) | The Company must give any Notice to Members who are joint holders of a Share to the person named first in the Register in respect of that Share, and that Notice is Notice to all holders of that Share. |
(d) | The Company may give Notice to a person entitled to a Share because of a Transmission Event in any manner specified in article 12.1. |
(e) | Notice to a person entitled to a Share because of a Transmission Event is taken to be Notice to the Member of that Share. |
(f) | A Notice to a Member is sufficient, even if: |
(i) | a Transmission Event occurs in respect of that Member (whether or not a joint holder of a Share); or |
(ii) | that Member is an externally administered body corporate, |
and regardless of whether or not the Company has Notice of that Transmission Event.
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(g) | A person entitled to a Share because of a transfer, Transmission Event or otherwise, is bound by every Notice given in respect of that Share. |
(h) | Any Notice required or allowed to be given by the Company to one or more Members by advertisement is, unless otherwise stipulated, sufficiently advertised if advertised once in a daily newspaper circulating in the states and territories of Australia. |
12.2 | Notice to Directors |
The Company may give Notice to a Director or Alternate Director:
(a) | in person; |
(b) | by sending it by post to the usual residential address of that person or the alternative address (if any) nominated by that person; |
(c) | by sending it to the fax number or electronic address (if any) nominated by that person; or |
(d) | by any other means agreed between the Company and that person. |
12.3 | Notice to the Company |
A person may give Notice to the Company by:
(a) | leaving it at the registered office of the Company during a time when the registered office is open; |
(b) | sending it by post to the registered office of the Company; |
(c) | sending it to a fax number at the registered office of the Company nominated by the Company for that purpose; |
(d) | sending it to the electronic address (if any) nominated by the Company for that purpose; or |
(e) | any other means permitted by the Corporations Act. |
12.4 | Time of service |
(a) | A Notice sent by post to an address within Australia is taken to be given: |
(i) | in the case of a Notice of meeting, one day after it is posted; or |
(ii) | in any other case, at the time at which the Notice would be delivered in the ordinary course of post. |
(b) | A Notice sent by post or air mail to an address outside Australia is taken to be given: |
(i) | in the case of a Notice of meeting, one day after it is posted; or |
(ii) | in any other case, at the time at which the Notice would be delivered in the ordinary course of post. |
(c) | A Notice sent by air courier to a place outside Australia is taken to be given one day after delivery to the air courier. |
(d) | A Notice sent by fax is taken to be given on the day it is sent, provided that the sender's transmission report shows that the whole Notice was sent to the correct fax number. |
(e) | A Notice sent to an electronic address is taken to be given on the date it is sent unless a delivery failure message is received by the Company. |
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(f) | The giving of a Notice by post, air mail or air courier is sufficiently proved by evidence that the Notice: |
(i) | was addressed to the correct address of the recipient; and |
(ii) | was placed in the post or delivered to the air courier. |
(g) | A certificate by a Director or Secretary of a matter referred to in article 12.4(f) is sufficient evidence of the matter, unless it is proved to the contrary. |
12.5 | Signatures |
The Directors may decide, generally or in a particular case, that a Notice given by the Company be signed by mechanical or other means.
12.6 | Payments |
(a) | The Company may pay a person entitled to an amount payable in respect of a Share (including a Dividend) by: |
(i) | crediting an account nominated in writing by that person; |
(ii) | cheque made payable to bearer, to the person entitled to the amount or any other person the person entitled directs in writing; or |
(iii) | any other manner as the Directors resolve. |
(b) | The Company may post a cheque referred to in article 12.6(a)(ii) to: |
(i) | the address in the Register of the Member of the Share; |
(ii) | if that Share is jointly held, the address in the Register of the Member named first in the Register in respect of the Share; or |
(iii) | any other address which that person directs in writing. |
(c) | Any joint holder of a Share may give effective receipt for an amount (including a Dividend) paid in respect of the Share. |
13 | Winding up |
13.1 | Distributions proportional to paid up capital |
Subject to any rights or restrictions attached to a class of Shares, on a winding up of the Company, any surplus must be divided among the Members in the proportions which the amount paid (including amounts credited) on the Shares of a Member is of the total amounts paid and payable (including amounts credited) on the Shares of all Members.
13.2 | Distributions of assets |
(a) | Subject to any rights or restrictions attached to a class of Shares, on a winding up of the Company, the liquidator may, with the sanction of a special resolution of the Members: |
(i) | distribute among the Members the whole or any part of the property of the Company; and |
(ii) | decide how to distribute the property as between the Members or different classes of Members. |
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(b) | The liquidator of the Company may settle any problem concerning a distribution under article 13 in any way, including: |
(i) | rounding amounts up or down to the nearest whole number; |
(ii) | ignoring fractions; |
(iii) | valuing assets for distribution; |
(iv) | paying cash to any Member on the basis of that valuation; and |
(v) | vesting assets in a trustee on trust for the Members entitled. |
(c) | A Member need not accept any property, including shares or other securities, carrying a liability. |
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Schedule 1
Definitions and Interpretation
1 | Definitions |
In this constitution, unless the context otherwise requires:
Adoption Date means the date on which this constitution is adopted by the Company as its constitution.
Alternate Director means a person for the time being holding office as an alternate Director of the Company under articles 7.4(a) to 7.4(i) (inclusive).
Applicable Law means the Corporations Act, the Listing Rules and the ASX Settlement Operating Rules.
AGM means an annual general meeting of Members.
ASX means ASX Limited (ACN 008 624 691) and where the context permits the Australian Securities Exchange operated by ASX Limited.
ASX Settlement means ASX Settlement Pty Limited (ACN 008 504 532).
ASX Settlement Operating Rules mean the operating rules of ASX Settlement.
Business Day:
(a) | if the Company is admitted to the Official List at the time, has the meaning given in the Listing Rules; or |
(b) | otherwise, means a day except a Saturday, Sunday or public holiday in Western Australia; |
Company means the company named IperionX Limited (ACN 618 935 372), or whatever its name may be from time to time.
Corporations Act means the Corporations Act 2001 (Cth), except to the extent of any exemption, modification, declaration or order made in respect of that legislation which applies to the Company.
Directors means the directors of the Company for the time being.
Dividend includes an interim dividend and a final dividend.
Eligible Member means, in respect of a meeting of Members:
(a) | the date and time specified in the Notice of that meeting, a person who is a Member at that time; or |
(b) | as otherwise determined by the party calling that meeting, |
provided that the time is not more than 48 hours prior to that meeting.
Executive Director means a Director who is an employee (whether full time or part time) of the Company or of any related body corporate of the Company other than by virtue of being a Director of the Company.
Legal Costs of a person means legal costs incurred by that person in defending an action for a Liability of that person.
Liability of a person means any liability incurred by that person as an officer of the Company or a subsidiary of the Company.
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Listing Rules means the listing rules of ASX and any other rules of ASX which are applicable while the Company is admitted to the Official List, each as amended or replaced from time to time, except and to the extent of any express written waiver by ASX.
Marketable Parcel has the meaning as defined under the ASX Listing Rules.
Member means a person whose name is entered in the Register as the holder of a Share.
Non Executive Directors means all Directors other than Executive Directors.
Notice means a notice given pursuant to, or for the purposes of, this constitution or Applicable Law.
Notifiable Interest has the meaning given by paragraph (a) of the definition of notifiable interest of a director in the Listing Rules.
Official List means the official list of ASX.
Personal Representative means the legal personal representative, executor or administrator of the estate of a deceased person.
Prescribed Notice means 28 days or any shorter period of Notice for a meeting of Members of the Company allowed under the Corporations Act.
Previous Constitution means the constitution of the Company immediately before the Adoption Date.
Register means the register of Members kept under Applicable Law and, where appropriate, includes any sub register and branch register.
Relevant Officer means a person who is, or has been, a Director or Secretary.
Secretary means a company secretary of the Company for the time being.
Share means a share in the capital of the Company.
Transmission Event means:
(c) | if a Member is an individual: |
(i) | death or bankruptcy of that Member; or |
(ii) | that Member becoming of unsound mind or becoming a person whose property is liable to be dealt with under a law about mental health; |
(d) | if a Member is a body corporate, the deregistration of that Member under the laws of the jurisdiction of its registration; or |
(e) | in any case, the vesting in, or transfer to, a person of the Shares of a Member without that person becoming a Member. |
Unmarketable Parcel means a holding of Shares which is less than a "marketable parcel" as defined under the ASX Listing Rules.
2 | Interpretation |
(a) | In this constitution, unless the context otherwise requires: |
(i) | a reference to a partly paid Share is a reference to a Share on which there is an amount unpaid; |
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(ii) | a reference to a call or an amount called in respect of a Share includes an amount that, by the terms of issue of a Share or otherwise, is payable at one or more fixed times; |
(iii) | a reference to a Share which is jointly held is a reference to a Share for which there is more than one Member; |
(iv) | a reference to a meeting of Members includes a meeting of any class of Members; |
(v) | a Member is taken to be present at a meeting of Members if the Member is present in person or by proxy, attorney or representative; and |
(vi) | a reference to a notice or document in writing includes a notice or document given by fax or another form of written communication. |
(b) | In this constitution, headings are for convenience only and do not affect interpretation, and unless the context indicates a contrary intention: |
(i) | words importing the singular include the plural (and vice versa); |
(ii) | words indicating a gender include every other gender; |
(iii) | the word person includes an individual, the estate of an individual, a corporation, an authority, an association or a joint venture (whether incorporated or unincorporated), a partnership and a trust; |
(iv) | where a word or phrase is given a defined meaning, any other part of speech or grammatical form of that word or phrase has a corresponding meaning; and |
(v) | the word includes in any form is not a word of limitation. |
(c) | In this constitution, unless the context otherwise requires: |
(i) | a reference to an article or a schedule is to an article or a schedule of this constitution; |
(ii) | a reference in a schedule to a paragraph is to a paragraph of that schedule; |
(iii) | a schedule is part of this constitution; and |
(iv) | a reference to this constitution is to this constitution (and where applicable any of its provisions) as modified or repealed from time to time. |
(d) | In this constitution, unless the context otherwise requires: |
(i) | a reference to any statute or to any statutory provision includes any statutory modification or re enactment of it or any statutory provision substituted for it, and all ordinances, by laws, regulations, rules and statutory instruments (however described) issued under it; and |
(ii) | a reference to the Listing Rules or the ASX Settlement Operating Rules includes any amendment or replacement of those rules from time to time. |
(e) | Unless the context indicates a contrary intention: |
(i) | an expression in a provision of this constitution which deals with a matter dealt with by a provision of Applicable Law has the same meaning as in that provision of Applicable Law; and |
(ii) | an expression in a provision of this constitution that is defined in section 9 of the Corporations Act has the same meaning as in that section. |
(f) | In this constitution, a reference to the Listing Rules, the ASX Settlement Operating Rules or ASX has effect only if at that time the Company is included in the Official List. |
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3 | Exercise of Powers |
Where this constitution confers a power or imposes a duty, then, unless the contrary intention appears, the power may be exercised and the duty must be performed from time to time as the occasion requires.
4 | Articles of this Constitution |
(a) | Unless Applicable Law provides that this constitution may contain a provision contrary to Applicable Law, the articles of this constitution are subject to Applicable Law such that any article of this constitution that is inconsistent with or contrary to Applicable Law will be read down to the extent of the inconsistency with Applicable Law. |
(b) | If an article is inconsistent with or contrary to Applicable Law and is not capable of being read down to the extent of the inconsistency under paragraph 4(c)(i), the relevant article will be severed from this constitution. |
(c) | If at any time any provision of this constitution is or becomes illegal, invalid or unenforceable in any respect under the law of any jurisdiction, that does not affect or impair: |
(i) | the legality, validity or enforceability in that jurisdiction of any other provision of this constitution; or |
(ii) | the legality, validity or enforceability under the law of any other jurisdiction of that or any other provision of this constitution. |
5 | Provisions required by Listing Rule 15.11.1 |
If the Company is admitted to the Official List, the following provisions apply:
(a) | notwithstanding anything contained in this constitution, if the Listing Rules prohibit an act being done, the act must not be done; |
(b) | nothing contained in this constitution prevents an act being done that the Listing Rules require to be done; |
(c) | if the Listing Rules require an act to be done or not to be done, authority is given for that act to be done or not to be done (as the case may be); |
(d) | if the Listing Rules require this constitution to contain a provision and it does not contain such a provision, this constitution is deemed to contain that provision; |
(e) | if the Listing Rules require this constitution not to contain a provision and it contains such a provision, this constitution is deemed not to contain that provision; and |
(f) | if any provision of this constitution is or becomes inconsistent with the Listing Rules, this constitution is deemed not to contain that provision to the extent of the inconsistency. |
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Schedule 2
Calls, Company payments, Forfeiture and Liens
1 | Exercise of Powers |
The powers of the Company under this Schedule 2 may only be exercised by the Directors.
2 | CALLS |
2.1 | Making a call |
(a) | Subject to the terms of issue of a Share, the Company may at any time make calls on the Members of a Share for all or any part of the amount unpaid on the Share as the Directors resolve. |
(b) | The Company may make calls payable for one or more Members for different amounts and at different times. |
(c) | Subject to the terms of issue of a Share, a call may be made payable by instalments. |
(d) | Subject to Applicable Law, the Company may revoke or postpone a call or extend the time for payment of a call. |
(e) | A call is made when the Directors resolve to make the call. |
2.2 | Notice of a call |
(a) | The Company must give Members at least 10 Business Days' Notice of a call. |
(b) | A Notice of a call must be in writing and specify the amount of the call, the due date for payment, the manner in which payment of the call must be made, the consequences of non payment of the call and any other information required by the Listing Rules. |
(c) | A call is not invalid if: |
(i) | a Member does not receive Notice of the call; or |
(ii) | the Company accidentally does not give Notice of the call to a Member. |
2.3 | Payment of a call |
(a) | A Member must pay to the Company the amount of each call made on the Member on the date and in the manner specified in the Notice of the call. |
(b) | If an amount unpaid on a Share is payable, by the terms of issue of the Share or otherwise, in one or more fixed amounts on one or more fixed dates, the Member of that Share must pay to the Company those amounts on those dates. |
(c) | A Member must pay to the Company: |
(i) | interest at the rate specified in paragraph 7(a) on any amount referred to in paragraph 2.3(a) or 2.3(b) which is not paid on or before the time appointed for its payment, from the time appointed for payment to the time of the actual payment; and |
(ii) | expenses incurred by the Company because of the failure to pay or late payment of that amount. |
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(d) | The Company may waive payment of all or any part of an amount payable under paragraph 2.3(c). |
(e) | The joint holders of a Share are jointly and severally liable for the payment of all calls due in respect of that Share. |
2.4 | Recovery of a call |
(a) | The Company may recover an amount due and payable under this paragraph 2 from a Member by: |
(i) | commencing legal action against the Member for all or part of the amount due; |
(ii) | enforcing a lien on the Share in respect of which the call was made; or |
(iii) | forfeiting the Share in respect of which the call was made. |
(b) | The debt due in respect of an amount payable under this paragraph 2 in respect of a Share is sufficiently proved by evidence that: |
(i) | the name of the Member sued is entered in the Register as one or more of the holders of that Share; and |
(ii) | there is a record in the minute books of the Company of: |
(A) | in the case of an amount referred to in paragraph 2.3(b), that amount; or |
(B) | in any other case, the resolution making the call. |
2.5 | Payment in advance of a call |
(a) | The Company may: |
(i) | accept from any Member all or any part of the amount unpaid on a Share held by the Member before that amount is called for; |
(ii) | pay interest at any rate the Directors resolve, on the amount paid before it is called, from the date of payment until and including the date the amount becomes actually payable; and |
(iii) | repay the amount paid to that Member. |
(b) | An amount paid pursuant to 2.5(a)(i) does not confer a right to participate in: |
(i) | a Dividend determined to be paid from the profits of the Company; or |
(ii) | any surplus of the Company in a winding up of the Company, |
for the period before the date when the amount paid would have otherwise become payable.
3 | Company Payments on behalf of a member |
3.1 | Rights of the Company |
(a) | A Member or, if the Member is deceased, the Member's Personal Representative, must indemnify the Company against any liability which the Company has under any law to make a payment (including payment of a tax) in respect of: |
(i) | a Share held by that Member (whether solely or jointly); |
(ii) | a transfer or transmission of Shares by that Member; |
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(iii) | a Dividend or other money which is, or may become, due or payable to that Member; or |
(iv) | that Member. |
(b) | A Member or, if the Member is deceased, the Member's Personal Representative, must pay to the Company immediately on demand: |
(i) | the amount required to reimburse the Company for a payment referred to in paragraph 3.1; and |
(ii) | pay to the Company interest at the rate specified in paragraph 7(a) on any amount referred to in paragraph 3.1(a) paid by the Company, from the date of payment by the Company until and including the date the Company is reimbursed in full for that payment. |
(c) | Subject to Applicable Law, the Company may refuse to register a transfer of any Shares by a Member referred to in paragraph 3.1(a) to 3.1(d), or that Member's Personal Representative, until all money payable to the Company under paragraphs 3.1 to 3.4 (inclusive) has been paid. |
(d) | The powers and rights of the Company under paragraphs 3.1(a) to 3.1(d) (inclusive) are in addition to any right or remedy that the Company may have under the law which requires the Company to make a payment referred to in paragraph 3.1(a). |
3.2 | Recovery of Company payments |
(a) | The Company may recover an amount due and payable under paragraphs 3.1(a) to 3.1(d) (inclusive) from the Member or the Member's Personal Representative by any or all of: |
(i) | deducting all or part of that amount from any other amount payable by the Company to that person in respect of the Shares of that person; |
(ii) | commencing legal action against that person for all or part of that amount; or |
(iii) | enforcing a lien on one or more of the Shares of that person. |
(b) | The Company may waive any or all its rights under paragraph 3. |
4 | Forfeiture |
4.1 | Forfeiture procedure |
(a) | The Company may forfeit a Share of a Member by a resolution of the Directors if: |
(i) | that Member does not pay a call or instalment on that Share on or before the date for its payment; |
(ii) | the Company gives that Member Notice: |
(A) | requiring the Member to pay that call or instalment, any interest on it and all expenses incurred by the Company by reason of the non payment; and |
(B) | stating that the Share is liable to be forfeited if that Member does not pay to the Company, at the place specified in the Notice, the amount specified in the Notice, within 10 Business Days (or any longer period specified) after the date of the Notice; and |
(b) | that Member does not pay that amount in accordance with that Notice. |
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4.2 | Notice of forfeiture |
(a) | When any Share has been forfeited, the Company must: |
(i) | give Notice of the forfeiture to the Member registered as its holder before the forfeiture; and |
(ii) | record the forfeiture with the date of forfeiture in the Register. |
(b) | Failure by the Company to comply with any requirement in paragraph 4.2 does not invalidate the forfeiture. |
4.3 | Effect of forfeiture |
(a) | The forfeiture of a Share extinguishes: |
(i) | all interests in that Share of the former Member; and |
(ii) | all claims against the Company in respect of that Share by the former Member, including all Dividends determined to be paid in respect of that Share and not actually paid. |
(b) | A former Member of a forfeited Share must pay to the Company: |
(i) | all calls, instalments, interest and expenses in respect of that Share at the time of forfeiture; and |
(ii) | interest at the rate specified in paragraph 7(a) on those amounts from the time of forfeiture until and including the date of payment of those amounts. |
4.4 | Sale or reissue of forfeited Shares |
The Company may sell, otherwise dispose of or reissue, a Share which has been forfeited on any terms and in any manner as the Directors resolve.
4.5 | Cancellation of forfeited Shares |
The Company may by ordinary resolution passed at a meeting of Members cancel a Share which has been forfeited under the terms on which the Share is on issue.
4.6 | Proof of forfeiture |
A certificate in writing from the Company signed by a Director or Secretary that a Share was forfeited on a specified date is sufficient evidence of:
(a) | the forfeiture of that Share; and |
(b) | the right and title of the Company to sell, dispose or reissue that Share. |
4.7 | Waiver or cancellation of forfeiture |
The Company may:
(a) | waive any or all of its rights under paragraph 4; and |
(b) | at any time before a sale, disposition, reissue or cancellation of a forfeited Share, cancel the forfeiture on any terms as the Directors resolve. |
5 | Liens |
5.1 | First ranking lien |
(a) | The Company has a first ranking lien on: |
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(i) | each Share registered in the name of a Member; |
(ii) | the proceeds of sale of those Shares; and |
(iii) | all Dividends determined to be payable in respect of those Shares, |
for:
(iv) | each unpaid call or instalment which is due but unpaid on those Shares; |
(v) | if those Shares were acquired under an employee incentive scheme, all amounts payable to the Company by the Member under loans made to enable those Shares to be acquired; |
(vi) | all amounts which the Company is required by law to pay, and has paid, in respect of those Shares (including any payment under paragraph 3) or the forfeiture or sale of those Shares; and |
(vii) | all interest and expenses due and payable to the Company under this Schedule 2. |
5.2 | Enforcement by sale |
The Company may sell a Share of a Member to enforce a lien on that Share if:
(a) | an amount secured by that lien is due and payable; |
(b) | the Company gives that Member or the Member's Personal Representative Notice: |
(i) | requiring payment to the Company of that amount, any interest on it and all expenses incurred by the Company by reason of the non payment; and |
(ii) | stating that the Share is liable to be sold if that person does not pay to the Company, in the manner specified in the Notice, the amount specified in the Notice within 10 Business Days (or any longer period specified) after the date of the Notice; and |
(c) | that Member or the Member's Personal Representative does not pay that amount in accordance with that Notice. |
5.3 | Release or waiver of lien |
(a) | Registration of a transfer of a Share by the Company releases any lien of the Company on that Share in respect of any amount owing on that Share, unless the Company gives Notice, to the person to whom that Share is transferred, of the amount owing. |
(b) | The Company may waive any or all of its rights under paragraph 5. |
6 | Sales, Disposals and Reissues |
6.1 | Sale procedure |
(a) | The Company may: |
(i) | receive the purchase money or consideration for Shares sold or disposed of under this Schedule 2; |
(ii) | appoint a person to sign a transfer of Shares sold or disposed of under this Schedule 2; |
(iii) | do all things necessary or desirable under Applicable Law to effect a transfer of Shares sold or disposed of under this Schedule 2; and |
(iv) | enter in the Register the name of the person to whom Shares are sold or disposed. |
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(b) | The person to whom a Share is sold or disposed under this Schedule 2 need not enquire whether the Company: |
(i) | properly exercised its powers under this Schedule 2 in respect of that Share; or |
(ii) | properly applied the proceeds of sale or disposal of those Shares, |
and the title of that person is not affected by those matters.
(c) | The remedy (if any) of any person aggrieved by a sale or other disposal of Shares under this Schedule 2 is in damages only and against the Company exclusively. |
(d) | A certificate in writing from the Company signed by a Director or Secretary that a Share was sold, disposed of or reissued in accordance with this Schedule 2 is sufficient evidence of those matters. |
6.2 | Application of proceeds |
The Company must apply the proceeds of any sale, other disposal or reissue of any Shares under this Schedule 2 in the following order:
(a) | the expenses of the sale, other disposal or reissue; |
(b) | the amounts due and unpaid in respect of those Shares; and |
(c) | the balance (if any) to the former Member or the former Member's Personal Representative, on the Company receiving the certificate (if any) of those Shares or other evidence satisfactory to the Company regarding the ownership of those Shares. |
7 | Interest |
(a) | A person must pay interest under this Schedule 2 to the Company: |
(i) | at a rate the Directors resolve; or |
(ii) | if the Directors do not resolve, at 15 per cent per annum. |
(b) | Interest payable to the Company under this Schedule 2 accrues daily. |
(c) | The Company may capitalise interest payable under this Schedule 2 at any interval the Directors resolve. |
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Schedule 3
Transmission
1 | Deceased Members |
1.1 | Effect of death |
(a) | If a Member in respect of a Share which is not jointly held dies, the Company must recognise only the Personal Representative of that Member as having any title to or interest in, or any benefits accruing in respect of, that Share. |
(b) | If a Member in respect of a Share which is jointly held dies, the Company must recognise only the surviving Members of that Share as having any title to or interest in, or any benefits accruing in respect of, that Share. |
1.2 | Estates and Personal Representatives |
(a) | The estate of a deceased Member is not released from any liability in respect of the Shares registered in the name of that Member. |
(b) | Where two or more persons are jointly entitled to any Share as a consequence of the death of the registered holder of that Share, they are taken to be joint holders of that Share. |
2 | TRANSMISSION EVENTS |
2.1 | Transmittee right to register or transfer |
(a) | Subject to the Bankruptcy Act 1966 (Cth) if a person entitled to a Share because of a Transmission Event gives the Directors the information they reasonably require to establish the person's entitlement to be registered as the holder of the Share, that person may: |
(i) | elect to be registered as a Member in respect of that Share by giving a signed Notice to the Company; or |
(ii) | transfer that Share to another person. |
(b) | On receiving a Notice under paragraph 2.1(a)(i), the Company must register the person as the holder of that Share. |
(c) | A transfer under paragraph 2.1(a)(ii) is subject to all provisions of this constitution relating to transfers of Shares. |
2.2 | Other transmute rights and obligations |
(a) | A person registered as a Member as a consequence of paragraphs 2.1(a) to 2.1(c) (inclusive) must indemnify the Company to the extent of any loss or damage suffered by the Company as a result of that registration. |
(b) | A person who has given to the Directors the information referred to in paragraph 2.1(a) in respect of a Share is entitled to the same rights to which that person would be entitled if registered as the holder of that Share. |
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Schedule 4
Unmarketable Parcels
1 | Definitions |
In this schedule, unless the context otherwise requires, Sale Share means a Share which is sold or disposed of in accordance with this schedule.
2 | Power to sell unmarketable parcels |
2.1 | Existing unmarketable parcels |
(a) | The Company may sell the Shares of a Member if: |
(i) | the total number of Shares of a particular class held by that Member is less than a marketable parcel; |
(ii) | the Company gives that Member Notice stating that the Shares are liable to be sold or disposed of by the Company; and |
(iii) | that Member does not give Notice to the Company, by the date specified in the Notice of the Company (being not less than 42 days after the date of the Company giving that Notice), stating that all or some of those Shares are not to be sold or disposed of. |
(b) | The Company may only exercise the powers under paragraph 2.1(a), in respect of one or more Members, once in any 12 month period. |
(c) | The power of the Company under paragraph 2.1(a) lapses following the announcement of a takeover bid. However, the procedure may be started again after the close of the offers made under the takeover bid. |
2.2 | New unmarketable parcels |
(a) | The Company may sell the Shares of a Member if: |
(i) | the Shares of a particular class held by that Member are in a new holding created by a transfer on or after 1 September 1999; and |
(ii) | that transfer is of a number of Shares of that class that was less than a marketable parcel at the time the transfer document was initiated, or in the case of a paper based transfer document, was lodged with the Company. |
(b) | The Company may give a Member referred to in paragraph 2.2(a) Notice stating that the Company intends to sell or dispose of the Shares. |
3 | Exercise of power of sale |
3.1 | Extinguishment of interests and claims |
(a) | The exercise by the Company of its powers under paragraph 2 extinguishes, subject to this Schedule 4: |
(i) | all interests in the Sale Shares of the former Member; and |
(ii) | all claims against the Company in respect of the Sale Shares by that Member, including all Dividends determined to be paid in respect of those Share and not actually paid. |
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3.2 | Manner of sale |
(a) | The Company may sell or dispose of any Shares under paragraph 2 at any time: |
(i) | using a financial services licensee on the basis that person obtains the highest possible price for the sale of the Shares; or |
(ii) | in any other manner and on any terms as the Directors resolve. |
(b) | The Company may: |
(i) | exercise any powers permitted under Applicable Law to enable the sale or disposal of Shares under this schedule; |
(ii) | receive the purchase money or consideration for Sale Shares; |
(iii) | appoint a person to sign a transfer of Sale Shares; and |
(iv) | enter in the Register the name of the person to whom Sale Shares are sold or disposed. |
(c) | The person to whom a Sale Share is sold or disposed need not enquire whether the Company: |
(i) | properly exercised its powers under this schedule in respect of that Share; or |
(ii) | properly applied the proceeds of sale or disposal of those Shares, |
and the title of that person is not affected by those matters.
(d) | The remedy of any person aggrieved by a sale or disposal of Sale Shares is in damages only and against the Company exclusively. |
(e) | A certificate in writing from the Company signed by a Director or Secretary that a Share was sold or disposed of in accordance with this Schedule 4 is sufficient evidence of those matters. |
3.3 | Application of proceeds |
(a) | If the Company exercises the powers under paragraphs 2.1(a) to 2.1(c) (inclusive), either the Company or the person to whom a Sale Share is sold or disposed of must pay the expenses of the sale or disposal. |
(b) | The Company must apply the proceeds of any sale or disposal of any Sale Shares in the following order: |
(i) | in the case of an exercise of the powers under paragraphs 2.2(a) and 2.2(b), the expenses of the sale or disposal; |
(ii) | the amounts due and unpaid in respect of those Shares; and |
(iii) | the balance (if any) to the former Member or the former Member's Personal Representative, on the Company receiving the certificate (if any) for those Shares or other evidence satisfactory to the Company regarding the ownership of those Shares. |
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3.4 | Voting and dividend rights pending sale |
(a) | If the Company is entitled to exercise the powers under paragraphs 2.2(a) and 2.2(b), the Company may by resolution of the Directors remove or change either or both: |
(i) | the right to vote; and |
(ii) | the right to receive Dividends, |
of the relevant Member in respect of some or all of the Shares liable to be sold or disposed of.
(b) | After the sale of the relevant Sale Shares, the Company must pay to the person entitled any Dividends that have been withheld under paragraph 3.4(a). |
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Schedule 5
Proportional Takeover Bid Approval
1 | Definitions |
In this schedule, unless the context otherwise requires:
Approving Resolution means a resolution to approve a proportional takeover bid in accordance with this Schedule 5.
Deadline means the 14th day before the last day of the bid period for a proportional takeover bid.
Voter means a person (other than the bidder under a proportional takeover bid or an associate of that bidder) who, as at the end of the day on which the first offer under that bid was made, held bid class securities for that bid.
2 | Refusal of Transfers |
2.1 | Requirement for an Approving Resolution |
(a) | The Company must refuse to register a transfer of Shares giving effect to a takeover contract for a proportional takeover bid unless and until an Approving Resolution is passed in accordance with this Schedule 5. |
(b) | This Schedule 5 ceases to apply on the third anniversary of its last adoption, or last renewal, in accordance with the Corporations Act. |
2.2 | Voting on an Approving Resolution |
(a) | Where offers are made under a proportional takeover bid, the Directors must, call and arrange to hold a meeting of Voters for the purpose of voting on an Approving Resolution before the Deadline. |
(b) | The provisions of this constitution concerning meetings of Members (with the necessary changes) apply to a meeting held under paragraph 2.2(a). |
(c) | Subject to this constitution, every Voter present at the meeting held under paragraph 2.2(a) is entitled to one vote for each Share in the bid class securities that the Voter holds. |
(d) | To be effective, an Approving Resolution must be passed before the Deadline. |
(e) | An Approving Resolution that has been voted on is taken to have been passed if the proportion that the number of votes in favour of the resolution bears to the total number of votes on the resolution is greater than 50 per cent, and otherwise is taken to have been rejected. |
(f) | If no Approving Resolution has been voted on as at the end of the day before the Deadline, an Approving Resolution is taken, for the purposes of this schedule, to have been passed in accordance with this Schedule 5. |
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Schedule 6
Preference Shares
1 | Definitions |
In this schedule, unless the context otherwise requires:
Conversion Circumstances means, in respect of a Converting Preference Share, whether the Preference Share is liable to be converted or convertible:
(a) | at the option of the Holder, or of the Company, or both; |
(b) | upon the happening of a particular event; or |
(c) | at a fixed time. |
Conversion Date means, in respect of a Converting Preference Share, the date (if any) specified in the Issue Resolution for the conversion of that Preference Share or the date upon which an event specified in the Issue Resolution occurs which results in the conversion of that Preference Share.
Conversion Number means the number, or formula for determining the number, of ordinary Shares into which a Converting Preference Share will convert upon conversion.
Converting Preference Share means a Preference Share which is specified in the Issue Resolution as being liable to be converted or convertible into ordinary Shares in a manner permitted by the Corporations Act, whether at the option of the Holder or otherwise.
Dividend means any distribution of any property (including without limitation, money, Paid Up shares, debentures, debenture stock or other securities of the Company or of any other Corporation) to a Holder in respect of a Preference Share as a dividend, whether interim or final
Dividend Date means, in respect of a Preference Share, a date specified in the Issue Resolution on which a Dividend in respect of that Preference Share is payable.
Dividend Rate means, in respect of a Preference Share, the terms specified in the Issue Resolution for the calculation of the amount of Dividend to be paid in respect of that Preference Share on any Dividend Date, which calculation may be wholly or partly established by reference to an algebraic formula.
Franked Dividend has the meaning given in the Income Tax Assessment Act 1936 (Cth).
Holder means, in respect of a Preference Share, the registered holder of that Share.
Issue Resolution means the resolution specified in paragraph 3.
Preference Share means a Share issued under articles 2.2(a) to 2.2(c) (inclusive).
Redeemable Preference Share means a Preference Share which is specified in the Issue Resolution as being liable to be redeemed in a manner permitted by the Corporations Act.
Redemption Amount means, in respect of a Redeemable Preference Share, the amount specified in the Issue Resolution to be paid on redemption of the Redeemable Preference Share.
Redemption Circumstances means, in respect of a Redeemable Preference Share, whether the Preference Share is liable to be redeemed:
(d) | at the option of the Holder, or of the Company, or both; |
(e) | upon the happening of a particular event; or |
(f) | at a fixed time. |
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Redemption Date means, in respect of a Redeemable Preference Share, the date specified in the Issue Resolution for the redemption of that Preference Share or the date upon which an event specified in the Issue Resolution occurs which results in the redemption of that Preference Share.
Specified Date means, in respect of a Redeemable Preference Share, the date (if any) specified in the Issue Resolution before which that Redeemable Preference Share may not be redeemed by the Holder.
2 | Rights of Holders |
Each Preference Share confers upon its Holder:
(a) | the rights referred to in articles 2.2(b) and 2.2(c); |
(b) | the right in winding up to payment in cash of the amount then paid up on it, and any arrears of Dividend in respect of that Preference Share in priority to any other class of Shares; |
(c) | the right in priority to any payment of a Dividend to any other class of Shares, to a cumulative preferential dividend payable on each Dividend Date in relation to that Preference Share calculated in accordance with the Dividend Rate in relation to that Preference Share; and |
(d) | no right to participate beyond the extent elsewhere specified in this paragraph 2 in surplus assets or profits of the Company, whether in winding up or otherwise. |
3 | Issue Resolution |
3.1 | The Directors may allot a Preference Share by a resolution of the Directors specifying: |
(a) | the Dividend Date; |
(b) | the Dividend Rate; |
(c) | whether the Preference Share is or is not a Redeemable Preference Share; |
(d) | if the Preference Share is a Redeemable Preference Share, the Redemption Amount, the Redemption Date, the Redemption Circumstances and any Specified Date for that Redeemable Preference Share; |
(e) | that the Preference Share is a Converting Preference Share; |
(f) | the Conversion Circumstances, the Conversion Number and any Conversion Date; and |
(g) | any other terms and conditions to apply to that Preference Share. |
3.2 | The Issue Resolution in establishing the Dividend Rate for a Preference Share may specify that the Dividend is to be: |
(a) | fixed; |
(b) | variable depending upon any variation of the respective values of any factors in an algebraic formula specified in the Issue Resolution; or |
(c) | variable depending upon such other factors as the Directors may specify in the Issue Resolution, |
and may also specify that the Dividend is to be a Franked Dividend or not a Franked Dividend.
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Where the Issue Resolution specifies that the Dividend to be paid in respect of the Preference Share is to be a Franked Dividend the Issue Resolution may also specify:
(d) | the extent to which such Dividend is to be franked; and |
(e) | the consequences of any Dividend paid not being so franked, which may include a provision for an increase in the amount of the Dividend to such an extent or by reference to such factors as may be specified in the Issue Resolution. |
4 | REDEMPTION |
4.1 | The Company must redeem a Redeemable Preference Share on issue: |
(a) | in the case where the Redeemable Preference Share is liable to be redeemed at the option of the Company, on the specified date where the Company, not less than 10 Business Days before that date, has given a Notice to the Holder of that Redeemable Preference Share stating that the Redeemable Preference Share will be redeemed on the specified date; |
(b) | in the case where the Redeemable Preference Share is liable to be redeemed at the option of the Holder, on the specified date where the Holder of that Redeemable Preference Share, not less than 10 Business Days before that date, has given a Notice to the Company stating that the Redeemable Preference Share will be redeemed on the specified date; and |
(c) | in any event, on the Redemption Date, |
but no Redeemable Preference Share may be redeemed by the Holder before the Specified Date unless the Redemption Date occurs before that date.
4.2 | On redemption of a Redeemable Preference Share, the Company, after the Holder has surrendered to the Company the Certificate (if any) in respect of that Redeemable Preference Share, must pay to the Holder the Redemption Amount by: |
(a) | directly crediting the account nominated in writing by the Holder from time to time; or |
(b) | cheque made payable to the Holder or such other person nominated in writing by the Holder sent through the post to: |
(i) | in the case where the Holder is a joint holder of the Redeemable Preference Share, the address in the Register of the person whose name stands first on the Register in respect of the joint holding; or |
(ii) | otherwise, to the address of the Holder in the Register. |
5 | CONVERSION |
5.1 | The Company must convert a Converting Preference Share on issue: |
(a) | in the case where the Converting Preference Share is liable to be redeemed at the option of the Company, on the specified date where the Company, not less than 10 Business Days before that date, has given a Notice to the Holder of that Converting Preference Share stating that the Converting Preference Share will be converted on the specified date; |
(b) | in the case where the Converting Preference Share is liable to be redeemed at the option of the Holder, on the specified date where the Holder of that Converting Preference Share, not less than 10 Business Days before that date, has given a Notice to the Company stating that the Converting Preference Share will be converted on the specified date; and |
(c) | in any event, on the Conversion Date. |
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5.2 | On conversion of a Converting Preference Share the Company must allot to the Holder additional ordinary Shares such that following conversion the Holder holds that number of ordinary Shares in accordance with the Conversion Number. Conversion of a Converting Preference Shares does not constitute a cancellation, redemption or termination of a Converting Preference Share or the issue, allotment or creation of a new Share. |
5.3 | The allotment of additional ordinary Shares on Conversion does not constitute a cancellation, redemption or termination of a Converting Preference Share. Conversion is the taking effect of existing rights of a Converting Preference Share and the ending of the special rights attached to the Converting Preference Share. |
5.4 | Following Conversion, each Converting Preference Share will rank equally with and will confer rights identical with and impose obligations identical with all other fully paid ordinary Shares then on issue. |
6 | CERTIFICATE |
The Certificate (if any) issued by the Company in relation to any Preference Share, must specify in relation to that Preference Share:
(a) | the date of issue of the Preference Share; |
(b) | the Dividend Rate and Dividend Dates; |
(c) | whether the Preference Share is a Redeemable Preference Share; |
(d) | if the Preference Share is a Redeemable Preference Share, the: |
(i) | Redemption Circumstances; |
(ii) | Redemption Amount; and |
(iii) | Redemption Date to the extent possible or if not, the event which if it occurs will result in redemption of that Redeemable Preference Share; |
(e) | the: |
(i) | Conversion Circumstances; |
(ii) | Conversion Number; and |
(iii) | Conversion Date to the extent possible or if not, the event which if it occurs will result in conversion of that Concerting Preference Share; and |
(f) | any other matter the Directors determine. |
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If to Hyperion or HYM:
|
[***]
|
||
with copy to:
|
[***]
|
||
If to Blacksand:
|
[***]
|
||
If to Member Zhigang Zak Fang:
|
[***]
|
||
If to Wenfang Bien Fang:
|
[***]
|
||
If to Pei Sun:
|
[***]
|
||
If to Madapusi K. Keshavan:
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[***]
|
HYPERION:
|
||
Hyperion Materials & Technologies, LLC
|
||
By:
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/s/ Anastasios Arima
|
|
Name:
|
Anastasios Arima
|
|
Title:
|
Manager
|
Blacksand:
|
||
Blacksand Technology, LLC
|
||
By:
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/s/ Madapusi K. Keshavan
|
|
Name:
|
Madapusi K. Keshavan
|
|
Title:
|
President
|
MEMBERS:
|
|
/s/ Zhigang Zak Fang
|
|
Zhigang Zak Fang
|
|
/s/ Wenfang Bian Fang
|
|
Wenfang Bian Fang
|
|
/s/ Pei Sun
|
|
Pei Sun
|
|
/s/ Madapusi K. Keshavan
|
|
Madapusi K. Keshavan
|
HYM:
|
||
Hyperion Metals Limited
|
||
By:
|
/s/ Anastasios Arima
|
|
Name:
|
Anastasios Arima
|
|
Title:
|
Director
|
|
By:
|
/s/ Gregory Swan
|
|
Name:
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Gregory Swan
|
|
Title:
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Company Secretary
|
Exhibit 4.2
CERTAIN IDENTIFIED INFORMATION HAS BEEN EXCLUDED FROM THE EXHIBIT BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) IS THE TYPE OF INFORMATION THAT THE REGISTRANT TREATS AS PRIVATE OR CONFIDENTIAL. INFORMATION THAT WAS OMITTED HAS BEEN NOTED IN THIS DOCUMENT WITH A PLACEHOLDER IDENTIFIED BY THE MARK “[***]”.
OPTION OF EXCLUSIVE LICENSE AGREEMENT
BETWEEN
HYPERION MATERIALS & TECHNOLOGIES, LLC
AND
BLACKSAND TECHNOLOGY, LLC
Contents
1. Definitions | 3 |
2. License Grant | 4 |
3. Royalties | 5 |
4. Records, Books, and Examinations | 6 |
5. Term of the License | 6 |
6. Licensor’s Performance | 6 |
7. Sublicensing Rights | 6 |
8. Representations and Warranties | 7 |
9. Modification and Termination | 9 |
10. Liability | 10 |
11. Infringement and Litigation | 11 |
12. Confidentiality | 11 |
13. Miscellaneous | 12 |
APPENDIX A – Master Services Agreement and Statement of Work | 14 |
Page 2 of 15
OPTION OF EXCLUSIVE LICENSE AGREEMENT
BETWEEN
HYPERION MATERIALS & TECHNOLOGIES, LLC
AND
BLACKSAND TECHNOLOGY, LLC
This Option of Exclusive License Agreement (“Agreement”) is entered into between Blacksand Technology, LLC, a limited liability company organized under the laws of Utah (“Licensor”), with offices at 1782 West 2300 South, West Valley City, Utah 84119, and Hyperion Materials & Technologies, LLC, a limited liability company organized under the laws of North Carolina (“Licensee”), with offices at 32N Main St. Suite 100, Belmont, North Carolina, 28012.
RECITATIONS
WHEREAS, Licensor is party to a certain License Agreement, dated August 24, 2015, between University of Utah Research Foundation (“UURF”) and Licensor, as amended by Amendment to License Agreement dated March 20, 2016, and as the same may be amended from time to time (the “UURF License Agreement”), pursuant to which Licensor has received an exclusive license and related rights to the Licensed Patents and Licensed Products (as defined herein). The UURF License Agreement is attached to this Agreement for reference only as Appendix A.
WHEREAS, pursuant to the UURF License Agreement, UURF granted to Licensor the exclusive right to sublicense the Licensed Patents and Licensed Products to sublicensees provided that Licensor has exclusive rights in the territory being sublicensed, and Licensor currently has such exclusive rights to sublicense the Licensed Patents and Licensed Products to Licensee in the Licensed Territory.
WHEREAS, pursuant to the Master Services Agreement (as amended, “MSA”) and Statement of Work #1 of even date herewith (as amended, “Statement of Work”), Licensor has granted Licensee an option (the “Option”) to acquire the License (as defined herein).
WHEREAS, each of the MSA and Statement of Work are attached to this Agreement as Appendix B and incorporated by reference.
AGREEMENT
NOW THEREFORE, in accordance with the aforementioned recitations and in consideration of the release and of the covenants and obligations hereinafter set forth to be well and truly performed, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto hereby agree as follows:
1. | Definitions |
As used in this Agreement, the following terms shall have the following meanings and such meanings shall be equally applicable to both the singular and plural forms of the terms defined.
1.1. “Affiliate” means any corporation, firm, partnership, or other entity in which Licensee owns or controls more than fifty percent (50%) of the voting stock or interests thereof.
1.2. “Effective Date” means the date when this Agreement is signed by both parties.
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1.3. “Exclusive Licensed Use” means use of the Licensed Patents and Licensed Products, within the Licensed Territory, to process titanium-bearing ores or titanium feedstocks with a percentage of TiO2 of 96% or below for the production of Ti-metal or Ti-metal alloy powders. The Exclusive Licensed Use includes processing of all Ti-minerals and Ti-slags into Ti-metal powders, but excludes processing of commercial TiO2 powder into Ti-metal powders and excludes the production of TiO2 powder.
1.4. “Licensed Patents” means [***].
1.5. “Licensed Products” mean any and all apparatus, articles of manufacture, compositions of matter, methods, uses, processes or products falling in whole or in part within, or generated in whole or in part from, and including Licensed Products (as defined in the UURF License Agreement) and Licensed Services (as defined in the UURF License Agreement), to the extent within the scope of one or more claims of the Licensed Patents,
1.6. “Licensed Territory” means worldwide.
1.7 “Sublicense” means a grant of rights by Licensee to a third party (each a “Sublicensee”) to make, have made, use, have used, sell, import, have imported, export or have exported, Licensed Products for the Exclusive Licensed Use within the Licensed Territory for which Licensee has received an Exclusive License for the Licensed Patents as provided under this Agreement.
1.8 “The Point of Practical Application” means the stage of development of the products and methods described and claimed in the Licensed Patents at which the parties determine that the products and methods may be safely and legally utilized and that their benefits are, to the extent permitted by law or government regulations, available to the public on reasonable terms.
2. | License Grant |
2.1. Subject to the terms, covenants, conditions and limitations set forth in this Agreement, Licensee’s full and complete performance and payment of its obligations under the MSA and the Statement of Work, and Licensee’s ongoing compliance with laws and regulations applicable to the Licensed Territory, Licensor hereby grants to Licensee an exclusive use license (the “License”) to the Licensed Patents and Licensed Products solely for Exclusive Licensed Use. This license is non-assignable except as may be permitted pursuant to the terms of Article 7 or Article 13.5 hereof.
2.2. For the avoidance of doubt, Licensor and Licensee acknowledge that nothing in this Agreement shall prohibit or limit Licensee from selling or using the Licensed Products within the Licensed Territory, provided that Licensee will provide Licensor with advance written notice of any such use outside of the United States so that Licensor can coordinate patent or other intellectual property protection for the Licensed Patents and the Licensed Products.
2.3. Licensee acknowledges that, as between Licensee and Licensor, Licensor owns all right, title, and interest, including all intellectual property rights, in and to the Licensed Patents and any intellectual property arising therefrom, directly or indirectly, whether in existence as of the Effective Date or created thereafter, required to enter into this Agreement, and that Licensee’s rights thereto are limited to the License granted pursuant to this Agreement.
2.4. The exclusive nature of the License is at all times subject to Licensee’s ongoing compliance with its obligations hereunder, and at any time Licensee fails to so comply, any and all exclusivity shall, upon fifteen (15) days’ prior written notice to Licensee from Licensor, automatically terminate unless Licensee has cured (and provided evidence thereof to Licensor) any such noncompliance prior to the expiration of such 15-day period.
Page 4 of 15
3. | Royalties |
In consideration of the License:
3.1. Licensee shall pay to Licensor a nonrefundable license fee of (a) $650,000 (Six Hundred Fifty Thousand US Dollars) upon exercise of the Option (the “Initial License Payment”); (b) an additional $750,000 (Seven Hundred Fifty Thousand US Dollars) upon the first anniversary of the Initial License Payment; and (c) an additional $500,000 (Five Hundred Thousand US Dollars) upon the second anniversary of the Initial License Payment.
3.2. Commencing on the third anniversary of the Initial License Payment, and on each subsequent anniversary thereafter, Licensee shall pay Licensor the Annual Minimum License Payment, as defined below. The “Annual Minimum License Payment” shall be (a) with respect to the third, fourth and fifth anniversaries of the Initial License Payment, $150,000, and (b) with respect to the sixth anniversary of the Initial License Payment and each anniversary thereafter until termination of this Agreement, $250,000. The Annual Minimum License Payment shall be nonrefundable but may be credited toward the payment of any other royalties payable by Licensee pursuant to Article 3.3 within the calendar year in which the Annual Minimum License Payment is due.
3.3. Licensee shall pay to Licensor a royalty equal to 3% (three percent) of the Net Value (as defined in Article 3.4 below) of each Licensed Product which is sold, transferred (except to a Sublicensee for the limited purpose of facilitating later sale of Licensed Product to customers), or used internally by Licensee or a Sublicensee until termination of this Agreement (“Annual Earned Royalty”). Payment of the Annual Earned Royalty shall be made not later than by 15 April of each year with respect to all Annual Earned Royalty accrued but unpaid with respect to the preceding calendar year; late payments shall accrue interest at a rate of [***] per month, compounding monthly, until paid in full (and Licensee shall reimburse Licensor for all reasonable collection costs (including reasonable attorneys’ fees) associated with such payment).
3.4. Licensed Products shall be considered to be “sold” when they are shipped, delivered, and paid for by the customer (by purchase, rental, or other transaction), whether by Licensee, an Affiliate of Licensee or Sublicensee. “Net Value” means the sum of all charges billed or invoiced by Licensee, an Affiliate of Licensee or a Sublicensee to customers for sales of Licensed Product, less (a) customary trade, quantity, or discounts actually allowed and taken; (b) amounts paid or credited by reason of rejections or returns; (c) any freight or other transportation costs, insurance charges, duties, tariffs; (d) all sales and excise taxes based directly on sales or turnover or delivery of royalty bearing products; and (e) any commission or fee paid to sales agents or representatives, not to exceed [***] of the gross sales price.
3.5. Licensee shall reimburse Licensor for [***] of all reasonable and documented costs incurred by Licensor prior to and following the Effective Date for the preparation, filing, prosecution, maintenance and defense of the Licensed Patents (including those incurred in furtherance of the MSA and the Statement of Work) within thirty (30) days of Licensee’s receipt of invoice therefor. At Licensee’s request, Licensor will provide information and records concerning invoicing and determination of such reimbursable costs.
3.6. Pursuant to the UURF License Agreement, Licensor is responsible for providing UURF with at least fifteen (15) days advance notice of any material filing related to prosecution of a Licensed Patent so that UURF may provide its input on such filings. Licensor shall provide Licensee the same notice, and shall annually, and upon Licensee’s reasonable written request no more than once a quarter, provide Licensee and UURF with a written report concerning the status of the filing, prosecution, and maintenance of the Licensed Patents in the Licensed Territory.
Page 5 of 15
3.7. Licensee shall pay, within thirty (30) calendar days from any termination of this Agreement, the royalties accrued or accruable for payment at the time of any such termination.
4. | Records, Books, and Examinations |
4.1. Licensee agrees to make and keep full, accurate, and complete books and records as necessary to establish its compliance with Article 3 of this Agreement. With respect to the Exclusive Licensed Use granted herein, Licensee further agrees to provide reports substantially similar to those required under Article 8 of the UURF License Agreement.
4.2. Licensee agrees that Licensor, upon reasonable prior notice, may have a duly authorized agent or representative on Licensor’s behalf inspect, audit, or verify such books and records that are relevant to establishing Licensee’s compliance with Article 3 of this Agreement, either at Licensee’s place of business or at a place mutually agreed upon by the parties hereto. Any audit conducted hereunder shall be on a dollar-for-dollar basis without the use of statistical methods including but not limited to sampling and extrapolation.
5. | Term of the License |
5.1. The grant of the License shall be in force upon exercise of the Option and shall remain in force as long as Licensee continues to pay when due the amounts due to Licensor pursuant to Article 3 of this Agreement, and for as long as the Licensed Patents remain enforceable.
5.2. This Agreement shall otherwise remain in effect unless it is modified or terminated as provided in Article 9 of this License.
6. | Licensor’s Performance |
6.1. Subject to Article 3.5, Licensor shall pay all maintenance fees to maintain the life of the Licensed Patents. However, in the event that Licensor fails to make said payments, Licensee may pay any maintenance fee when due and likewise be entitled to reimbursement of [***] of such fees under Article 3.5.
6.2. At the request of Licensee, and at the discretion of Licensor, Licensor may provide technical assistance (not involving further research and development) to Licensee on a time and cost basis for the purpose of assisting Licensee in bringing the Licensed Products to the Point of Practical Application; provided, notwithstanding, that Licensor shall be obligated to perform Licensor’s obligations under the MSA and Statement of Work.
7. | Sublicensing Rights |
7.1. Subject to prior written approval by Licensor, not to be unreasonably withheld, conditioned or delayed, Licensee may grant Sublicenses under the Licensed Patents during the term of this Agreement where such Sublicense is consistent with and in furtherance of Licensee’s rights and obligations provided under this Agreement. Each Sublicense relationship will be evidenced by a written agreement and made subject and subordinate to this Agreement, including all rights retained or held by Licensor hereunder, and consistent with the relevant provisions hereof that apply to Sublicenses. A copy of all Sublicenses will be furnished to Licensor prior to the execution thereof for review and approval. The final executed Sublicenses will be promptly provided to Licensor by Licensee. For the avoidance of doubt, Licensor shall be entitled to all royalties, fees and other payments due to Licensor pursuant to Article 3 with respect to Licensed Products sold by Licensee’s Affiliates and Sublicensees as if sold by Licensee itself; Licensee shall be fully responsible to Licensor for any such amounts.
Page 6 of 15
7.2. In addition to the inclusion of all rights retained or held by Licensor hereunder, Licensee shall specifically include in each Sublicense Licensor’s right to terminate or modify a Sublicense pursuant to Article 9. Licensee shall not grant or exercise any rights that are inconsistent with the rights and obligations of Licensee or act in conflict with the residual rights of Licensor hereunder. Any Sublicense shall include an audit right by Licensor of the same scope as provided under Article 4 with respect to Licensee.
7.3. If a Sublicense request by a third party is made to Licensee, Licensee will use commercially reasonable efforts to grant a Sublicense if Licensee is not and will not be using the Licensed Patents for the requested field of use.
7.4. No other, further, or different power, right, or privilege to grant powers, rights, privileges, or immunities to third parties is granted or implied. Licensee shall remain wholly responsible and liable for the acts or omissions of each Sublicensee in connection with the subject matter hereof and the performance of its obligations as described herein.
8. | Representations and Warranties |
8.1 Each party represents and warrants to the other party as follows: (a) that it is a company formed and in good standing as of the Effective Date, (b) that the execution, delivery, and performance of this Agreement by each party has been authorized by all necessary action on the part of such party; (c) that this Agreement has been executed and delivered by each party and constitutes a legal, valid, and binding obligation of such party, enforceable against such party in accordance with its terms; (d) that the execution, delivery, and performance of this Agreement does not: (i) violate, conflict with, or result in, the breach of any provision of the charter or by-laws of such party; (ii) conflict with or violate any law or governmental order applicable to such party or any of its assets, properties, or businesses; or (iii) conflict with, result in any breach of, constitute a default under, require any consent under, or give to others any rights of termination, amendment, revocation, or cancellation of any contract, agreement, or other instrument or arrangement to which it is a party.
8.2 Licensor represents and warrants to Licensee that:
a. | Licensor owns all right, title and interest in, or has sufficient rights to, the Licensed Patents and Licensed Products, including all intellectual property rights related thereto, which are the subject of this Agreement, and has the exclusive right to enter into and perform under this Agreement and grant the License and release contained herein. |
b. | There are no disputes, lawsuits, arbitrations, patent infringement claims or other conflicts of interest, whether active or pending, arising from or in relation to any claim by any third-party, including inventors, against Licensor, its officers, employees, agents, shareholders, or affiliates in connection with any aspect of the Licensed Patents or Licensed Products. |
c. | Licensor is not aware of any disputes, lawsuits, arbitrations, patent infringement claims or other conflicts of interest, whether active or pending, arising from or in relation to any claim by any third-party, including the inventors of the technology related to the Licensed Patents or Licensed Products. |
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d. | Licensor is not aware of any patents, technology, methods, processes, inventions, know-how, intellectual property, or other data or information owned by third parties, which is needed for Licensee to utilize the Licensed Patents for commercial application. |
e. | Licensor has not granted, and during the term of this this Agreement will not grant, any licenses, sub licenses, or any contingent or non-contingent right, title or interest in the Licensed Patents and Licensed Products to any third party. |
f. | Subject to Licensee’s approval, not to be unreasonably withheld, conditioned or delayed, Licensor may work with third parties on matters related to the Licensed Patents and Licensed Products, and share data and information related to the Licensed Patents and Licensed Products with such third parties. |
8.3 Licensor further represents and warrants that the UURF License Agreement is in full force and effect and that Licensor is in compliance with the UURF License Agreement in all material respects. Licensor further represents and warrants that, before the Effective Date of this Agreement, Licensor has obtained written consent from UURF to enter into this Agreement with Licensee, and Licensor acknowledges and agrees that obtaining such written consent is a condition precedent to Licensee entering into this Agreement. Licensor warrants and covenants that it will use its best efforts to (a) perform all of its obligations in compliance with the UURF License Agreement, and (b) ensure that the UURF License Agreement remains in full force and effect for its term. Licensor warrants and covenants that it will provide written notice immediately to Licensee upon Licensor’s knowledge that (i) Licensor plans to provide notice to UURF of Licensor’s intent to terminate the UURF License Agreement, (ii) UURF plans to provide to Licensor, or Licensor has received from UURF, UURF’s notice to terminate the UURF License Agreement, (iii) or Licensor receives a notice of default under the UURF License Agreement. In the event that the UURF License Agreement is terminated by either UURF or Licensor, Licensor agrees to cooperate with Licensee in converting this Agreement into an exclusive license between Licensee and UURF.
8.4 EXCEPT AS EXPRESSLY SET FORTH IN ARTICLE 8, RIGHTS GRANTED HEREUNDER, INCLUDING RIGHTS TO LICENSED PRODUCTS, ARE PROVIDED “AS IS”, WITH NO REPRESENTATIONS OR WARRANTIES OF ANY KIND (EXPRESS, IMPLIED, OR OTHERWISE) IN CONNECTION WITH THIS AGREEMENT OR ITS SUBJECT MATTER. WITHOUT LIMITING THE FOREGOING, LICENSOR EXPRESSLY DISCLAIMS ANY EXPRESS OR IMPLIED WARRANTIES OF PATENT VALIDITY, NON-INFRINGEMENT, MERCHANTABILITY, OR FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THE RIGHTS GRANTED HEREUNDER, INCLUDING RIGHTS TO LICENSED PRODUCTS.
8.5 UURF Disclaimers and Limitation on Liability. WITHOUT LIMITING ANYTHING IN THIS ARTICLE 8, LICENSEE ACKNOWLEDGES THAT THIS AGREEMENT IS SUBJECT TO THE FOLLOWING PROVISIONS OF THE UURF LICENSE AGREEMENT IN FAVOR OF UURF: (A) SECTION 15.2 (NO REPRESENTATIONS AND WARRANTIES PROVIDED BY UURF), (B) SECTION 15.3 (DISCLAIMER OF SPECIFIC WARRANTIES BY UURF); AND (C) SECTION 15.4 (UURF LIMITATION OF LIABILITY).
8.6 Nothing relating to this Agreement nor the license grant itself shall be construed to confer upon Licensee any immunity from or defenses under the antitrust laws or from a charge of patent misuse, and the acquisition and use of the rights pursuant to this license shall not be immunized from the operation of state or Federal law.
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8.7 Nothing contained in this Agreement shall be interpreted to grant to Licensee any rights with respect to any invention other than the licensed invention specified herein.
9. | Modification and Termination |
9.1. Licensor may terminate or modify this Agreement in whole or in part if:
a. | Licensee is in breach of a covenant or agreement contained in this Agreement; or |
b. | Licensee has willfully made a false statement of or willfully omitted a material fact in any report required by this Agreement; or |
c. | Licensee has been found by a court of competent jurisdiction to have violated the Federal antitrust laws in connection with its performance under the License Agreement; or |
d. | Licensee is adjudged as bankrupt or has all or a substantial portion of its assets, relating to or utilized in performing operations herein licensed, placed in the hands of a temporary or permanent receiver or makes any assignment or other accommodation for the benefit of creditors, unless Licensee enters bankruptcy proceedings solely for the purpose of reorganizing and continues to do business during and after the bankruptcy. |
9.2. Licensor may directly terminate or modify any Sublicense if Licensor determines that any of the grounds for termination or modification of this Agreement provided under this Article 9 apply to a Sublicensee or to Sublicensee performance under a Sublicense.
9.3. Before modifying or terminating in whole or in part this Agreement or a Sublicense under any of the terms and conditions specified herein permitting modification or termination, other than by mutual agreement, Licensor shall furnish Licensee a written notice of intention to modify or terminate in whole or in part this Agreement or a Sublicense, and Licensee shall be allowed ninety (90) days after such notice to remedy any breach of any covenant or agreement set forth in this Agreement or a Sublicense.
9.4. Licensee may terminate or request modification in whole or in part of this Agreement:
a. | if the Licensed Patent is ruled by competent authorities not to be patentable in the Licensed Territory; or |
b. | by giving ninety (90) days prior written notice to Licensor. |
9.5. This Agreement may be terminated or modified upon mutual agreement of Licensor and Licensee.
9.6. The following rights and obligations survive any termination of this Agreement to the extent necessary to permit their complete fulfillment or discharge:
a. | Licensee’s obligation to maintain records and Licensor’s right to conduct a final audit as provided in Article 4 of this Agreement; |
b. | Any cause of action or claim of Licensor accrued, or to accrue, because of any breach or default by Licensee; and |
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c. | Licensee shall remain responsible for all royalties and fees accrued prior to its termination (whether or not yet due and payable). |
9.7. In the event of termination of this Agreement, Licensee may sell its remaining inventory of Licensed Products after such termination and Licensee may fulfill contractual obligations to supply Licensed Products under contracts entered into before the date of termination provided such obligations can be fulfilled within one calendar year of the date of termination, except for such contracts which contain indefinite delivery, indefinite quantities, or other unexercised options, in which case Licensee may fulfill contractual obligations through the life of the option period and the delivery requirements associated with such options. Licensee agrees to pay royalties on all Licensed Products sold, whether by Licensee or a Sublicensee, after the date of termination as set forth in Article 3 of this Agreement.
10. | Liability |
10.1. Licensee agrees to defend, indemnify, and hold Licensor harmless from and against all claims, liability, demands, damages, expenses for losses and death, personal injury, illness or property damage (each, a “Claim”) arising out of (a) the use, sale, or other disposition by Licensee, a Sublicensee, or any Licensee or Sublicensee customers or any other transferee of any Licensed Products, or (b) any act or omission of Licensee or any Sublicensee in the course of performing its obligations under this Agreement (or pursuant to any Sublicense).
10.2. Licensor agrees to defend, indemnify, and hold Licensee, UURF, The University of Utah, and their Affiliates and respective employees, managers, officers, agents, members, and successors (“Licensor Indemnified Parties”) harmless from and against all Claims arising out of any act or omission of Licensor in the course of performing its obligations under this Agreement.
10.3. Neither party shall be liable for any unforeseeable event beyond its reasonable control not caused by the fault or negligence of such party, which causes such party to be unable to perform its obligations (other than payment obligations) under this Agreement (and which it has been unable to overcome by the exercise of due diligence), including, but not limited to, flood, drought, earthquake, storm, fire, pestilence, lightning and other natural catastrophes, epidemic, war, riot, civic disturbance or disobedience, strikes, labor dispute, or failure, threat or failure, or sabotage, or any order or injunction made by a court or public agency. In the event of the occurrence of such a force majeure event, the party unable to perform shall promptly notify the other party. It shall further use its best efforts to resume performance as quickly as possible and shall suspend performance only for such period of time as is necessary as a result of the force majeure event.
10.4. IN NO EVENT WILL LICENSOR OR LICENSEE BE LIABLE UNDER OR IN CONNECTION WITH THIS AGREEMENT UNDER ANY LEGAL OR EQUITABLE THEORY, INCLUDING BREACH OF CONTRACT, TORT (INCLUDING NEGLIGENCE), STRICT LIABILITY, AND OTHERWISE, FOR ANY: (a) CONSEQUENTIAL, INCIDENTAL, INDIRECT, EXEMPLARY, SPECIAL, ENHANCED, OR PUNITIVE DAMAGES; (b) INCREASED COSTS, DIMINUTION IN VALUE OR LOST BUSINESS, PRODUCTION, REVENUES, OR PROFITS; (c) LOSS OF GOODWILL OR REPUTATION; (d) USE, INABILITY TO USE, LOSS, INTERRUPTION, DELAY OR RECOVERY OF ANY DATA, OR BREACH OF DATA OR SYSTEM SECURITY; OR (e) COST OF REPLACEMENT GOODS OR SERVICES, IN EACH CASE REGARDLESS OF WHETHER LICENSOR OR LICENSEE WAS ADVISED OF THE POSSIBILITY OF SUCH LOSSES OR DAMAGES OR SUCH LOSSES OR DAMAGES WERE OTHERWISE FORESEEABLE.IN NO EVENT WILL LICENSOR’S AGGREGATE LIABILITY ARISING OUT OF OR RELATED TO THIS AGREEMENT UNDER ANY LEGAL OR EQUITABLE THEORY, INCLUDING BREACH OF CONTRACT, TORT (INCLUDING NEGLIGENCE), STRICT LIABILITY, AND OTHERWISE EXCEED THE TOTAL AMOUNTS PAID TO LICENSOR UNDER THIS AGREEMENT IN THE SIX-MONTH PERIOD PRECEDING THE EVENT GIVING RISE TO THE CLAIM OR $1,000, WHICHEVER IS GREATER.
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10.5. UURF as Third Party Beneficiary. UURF shall be a third party beneficiary to the provisions of this Article 10, and shall have the right to enforce such provisions directly to the extent UURF may deem such enforcement necessary or advisable to protect its rights thereunder. Licensee hereby acknowledges and agrees to Article 20 (Indemnification) as it applies to UURF.
11. | Infringement and Litigation |
11.1. Should either party become aware of any infringement or potential infringement of Licensed Patents, it shall give the other party prompt written notice detailing as many facts as possible concerning such infringement or potential infringement.
11.2. If Licensor fails to bring an infringement action or provide Licensee with its written intent to bring an infringement action within three (3) months after receipt of a bona fide notification of infringement of Licensed Patents, Licensee is authorized in the United States to:
a. | Bring suit in a United States District Court in its own name or, if required by law, jointly with Licensor, at Licensee’s expense and on Licensee’s behalf, for infringement of Licensed Patents; |
b. | Enjoin infringement in any such suit, and to collect for its own benefit, any damages, profits, and awards of whatever nature recoverable for such infringement; |
c. | Settle any claim or suit for infringement of Licensed Patents. However, in no instance shall Licensee(s) be able to settle any such claim or suit by granting a sublicense. |
11.3. Licensee’s obligation to pay royalties to Licensor continues during infringement litigation or negotiations; provided, any amounts paid by Licensee to any third party as damages or compensation with respect to infringement of a third party’s rights shall be deducted from royalties due Licensor herein.
12. | Confidentiality |
12.1. From time to time during the term of this Agreement, either party or its Affiliates may disclose or make available to the other party or its Affiliates information about its business affairs, products, confidential intellectual property, trade secrets, third-party confidential information, and other sensitive or proprietary information, whether orally or in written, electronic, or other form or media/in written or electronic form or media, and whether or not marked, designated or otherwise identified as “confidential” (collectively, “Confidential Information”). Confidential Information does not include information that, at the time of disclosure is: (a) in the public domain; (b) known to the receiving party at the time of disclosure; (c) rightfully obtained by the receiving party on a non-confidential basis from a third party; or (d) independently developed by the receiving party. The receiving party shall not disclose the disclosing party’s Confidential Information to any person or entity, except to the receiving party’s employees who have a need to know the Confidential Information for the receiving party to exercise its rights or perform its obligations hereunder. Notwithstanding the foregoing, each party may disclose Confidential Information to the limited extent required (i) in order to comply with the order of a court or other governmental body, or as otherwise necessary to comply with applicable law, provided that the party making the disclosure pursuant to the order shall first have given written notice to the other party and made a reasonable effort to obtain a protective order; or (ii) to establish a party’s rights under this Agreement, including to make required court filings.
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12.2. On the termination of the Agreement, the receiving party shall promptly return to the disclosing party all copies, whether in written, electronic, or other form or media, of the disclosing party’s Confidential Information, or destroy all such copies and certify in writing to the disclosing party that such Confidential Information has been destroyed. Each party’s obligations of non-disclosure with regard to Confidential Information are effective as of the Effective Date and will expire five years from the date first disclosed to the receiving party; provided, however, with respect to any Confidential Information that constitutes a trade secret (as determined under applicable law), such obligations of non-disclosure will survive the termination or expiration of this Agreement for as long as such Confidential Information remains subject to trade secret protection under applicable law.
13. | Miscellaneous |
13.1. Licensee CGL Insurance. Beginning at the time the Licensed Product is first distributed or sold by Licensee, or its Affiliate or a sublicensee pursuant to Article 7, Licensee will, at its sole cost and expense, procure and maintain commercial general liability insurance issued by an insurance carrier with an A.M. Best rating of “A” or better in amounts that provide product liability and other liability coverage, as well as coverage for litigation costs, related to Article 10. Licensee will use reasonable efforts to include Licensor, UURF, and their respective officers, directors, members, employees, and agents, as additional insureds under Licensee’s commercial general liability insurance. All rights of subrogation will be waived against Licensor, UURF, and their respective insurers. Licensee will provide Licensor or UURF, with documentary evidence of such insurance upon written request by Licensor or UURF. Licensee will maintain such commercial general liability insurance beyond the expiration or termination of this Agreement during (a) the period that any Licensed Product is being commercially manufactured, distributed, or sold by Licensee, any Affiliate, or any sublicensee of Licensee, and (b) for one (1) yearafter such period.
13.2. Disputes. Before Licensee or Licensor may bring suit in any court concerning an issue relating to this Agreement, such party must first seek in good faith resolution of the issues through negotiation or other forms of nonbinding alternative dispute resolution mutually acceptable to the parties.
13.3. Governing Law. This Agreement will be interpreted, construed, and enforced in all respects in accordance with the laws of the State of North Carolina, without reference to its choice of law rules. Notwithstanding the foregoing, the courts within Salt Lake County in the State of Utah shall have exclusive jurisdiction and venue for all disputes between Licensor, UURF, or Licensee arising out of the UURF License Agreement to the extent involving rights or responsibilities of UURF. Further, the Parties agree that UURF shall be entitled to any protections, rights, or defenses applicable to it under the Utah Governmental Immunity Act, Utah Code Annotated sections 630-7-101, et. seq., as amended, in the same manner and to the same extent as if Utah law governed this Agreement.
13.4. Notices. All notices pertaining to or required by this Agreement shall be in writing and shall be signed by an authorized representative and shall be delivered by hand or sent by certified mail, return receipt requested, with postage prepaid, addressed as follows (or such mailing address as the parties may specify in writing):
For Licensor:
[***]
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For Licensee:
[***]
For the purposes of Sections 3.6 hereof:
[***]
13.5. Assignment. This Agreement may not be assigned or transferred by Licensee without the prior written consent of Licensor (except that no consent shall be required for a successor by merger to, an acquirer of substantially all of the assets of, or an entity affiliated with or controlled by or under common control with, Licensee in connection with that part of Licensee’s business to which the Licensed Patents and this Agreement pertain; however, in no event shall any rights or obligations of this Agreement be assigned or transferred to a party who is not a citizen and resident of the United States of America without the written consent of Licensor, not to be unreasonably withheld, conditioned or delayed).
13.6. Entire Agreement. This Agreement constitutes the entire agreement and understanding between Licensor and Licensee with respect to the subject matter hereof, and any modification of this Agreement shall be in writing and shall be signed by a duly authorized representative of both Licensor and Licensee. There are no understandings, representations, or warranties between Licensor and Licensee concerning the subject matter hereof except as expressly set forth in this Agreement.
13.7. Headings. Titles and headings of the sections and subsections of this Agreement are for the convenience of references only and do not form a part of this Agreement and shall in no way affect the interpretation thereof.
13.8. Severability. The illegality or invalidity of any provisions of this Agreement shall not impair, affect or invalidate the other provisions of this Agreement.
13.9. Proprietary Information. Both parties acknowledge that the terms of this Agreement, as well as Licensee’s plan for bringing the Licensed Patents to the Point of Practical Application, are confidential and shall not be discussed or revealed to third parties.
13.10. Export Regulation. The Licensed Products may be subject to US export control laws, including the Export Control Reform Act and its associated regulations. Licensee shall not, directly or indirectly, export, re-export, or release the Licensed Products to, or make the Licensed Products accessible from, any jurisdiction or country to which export, re-export, or release is prohibited by law, rule, or regulation. Licensee shall comply with all applicable federal laws, regulations, and rules, and complete all required undertakings (including obtaining any necessary export license or other governmental approval), prior to exporting, re-exporting, releasing, or otherwise making the Licensed Products available outside the United States.
13.11. Relationship of the Parties. The relationship between the parties is that of independent contractors. Nothing contained in this Agreement will be construed as creating any agency, partnership, joint venture, or other form of joint enterprise, employment, or fiduciary relationship between the parties.
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13.12. Counterparts. This Agreement may be executed in counterparts, each of which is deemed an original, but all of which together are deemed to be one and the same agreement.
13.13. Marking; Use of Names. Licensee agrees to comply with the provisions of Article 11 (Marking) and Article 25 (Use of Names) as set forth in the UURF License Agreement.
The Remainder of this page was intentionally left blank.
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IN WITNESS WHEREOF, the parties hereto have caused this instrument to be executed by their duly authorized representatives. For the avoidance of doubt, the Effective Date shall be the last date set forth below.
FOR LICENSEE:
Hyperion Materials & Technologies, LLC
/s/ Anastasios Arima | Date: | February 13, 2021 |
Name: Anastasios Arima
Title: Manager
FOR LICENSOR:
Blacksand Technology, LLC
/s/ Kesh Keshavan | Date: | February 13, 2021 |
Name: Kesh Keshavan
Title: President
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Exhibit 4.3
CERTAIN IDENTIFIED INFORMATION HAS BEEN EXCLUDED FROM THE EXHIBIT BECAUSE IT IS BOTH (I) NOT MATERIAL AND (II) IS THE TYPE OF INFORMATION THAT THE REGISTRANT TREATS AS PRIVATE OR CONFIDENTIAL. INFORMATION THAT WAS OMITTED HAS BEEN NOTED IN THIS DOCUMENT WITH A PLACEHOLDER IDENTIFIED BY THE MARK “[***]”.
MASTER SERVICES AGREEMENT
This Master Services Agreement (this “Agreement”) is made and entered into as of February 13, 2021 (the “Effective Date”) between Blacksand Technology LLC, a Utah limited liability company (“Blacksand”), and Hyperion Materials & Technologies, LLC, a North Carolina limited liability company (“Hyperion”). The parties agree as follows:
1. SERVICES AND STATEMENTS OF WORK
1.1 Services. Subject to the terms and conditions of this Agreement, Blacksand will perform the services described in one or more Statements of Work (as defined below) (collectively, the “Services”) and, to the extent applicable, Hyperion will perform the obligations thereof as described in any such Statement of Work. In the process of providing the Services, Blacksand may produce deliverables or other items pursuant to a Statement of Work.
1.2 Statements of Work. The specific details of the Services will be described in one or more written Statements of Work, substantially in the form of the Statement of Work set forth in Schedule 1 hereto, to be executed by both parties (each, a “Statement of Work”). Once executed by both parties, each Statement of Work, including Schedule 1, will be a unique agreement that incorporates the terms of this Agreement and stands alone from all other Statements of Work. If there is a conflict between the terms of this Agreement and the terms of a Statement of Work, the terms of this Agreement will control unless the Statement of Work states that a specific provision of this Agreement will be superseded by a specific provision of the Statement of Work.
1.3 Delays. The “Delivery Schedule” or any other timeline for Services, if any, set forth in a Statement of Work depends on performance by third parties and Hyperion. If Blacksand determines in its reasonable discretion that the Delivery Schedule or other timeline set forth in a Statement of Work may need to change due to (1) actions or delays of third parties (other than Blacksand’s suppliers, vendors and subcontractors), or (2) actions or delays of Hyperion, then it will notify Hyperion of such determination. If the actions or delays of third parties (other than Blacksand’s suppliers, vendors and subcontractors) or Hyperion causes material changes to the scope or timing of the Delivery Schedule or other timeline for Services or requires, in Blacksand’s reasonable discretion, an increase in Service Fees, then Blacksand shall notify Hyperion of the foregoing, and the parties shall work in good faith to agree on an amended Statement of Work to account for the changes in scope, Delivery Schedule (or other timing), or fees. If the actions or delays of Blacksand or Blacksand’s suppliers, vendors and subcontractors causes material changes to the scope or timing of the Delivery Schedule or other timeline for Services or requires, in Hyperion’s reasonable discretion, a decrease in Service Fees, then Hyperion shall notify Blacksand of the foregoing, and the parties shall work in good faith to agree on an amended Statement of Work to account for the changes in scope, Delivery Schedule (or other timing), or fees. Blacksand shall not be responsible for changes to the Delivery Schedule or other
timeline due to the actions or delays of any third party (other than Blacksand’s suppliers, vendors and subcontractors) or of Hyperion.
2. PERFORMANCE OF SERVICES
2.1 Performance Standard. Blacksand will diligently perform the Services in accordance with the applicable Statement of Work, including any specifications in the Statement of Work. Blacksand will use commercially reasonable efforts to complete the Services, including the delivery of any deliverables, in accordance with the Delivery Schedule and other schedule of times and milestones specified in the Statement of Work, and shall perform all Services in accordance with applicable laws and industry standards. To the extent Hyperion has performance obligations under a Statement of Work, Hyperion agrees to diligently perform such obligations in a commercially reasonable manner in accordance with applicable laws and industry standards.
2.2 Personnel. Blacksand shall be free to designate the appropriate personnel to accomplish the tasks required by each Statement of Work. However, the Services must be performed in a competent, timely, professional, and workmanlike manner by qualified personnel in accordance with applicable laws and industry standards.
2.3 Subcontractors. Blacksand may utilize independent subcontractors to perform all or part of the Services. In the event Blacksand uses subcontractors, Blacksand will remain solely responsible for the performance of all of the Services that are subcontracted.
2.4 Materials. Except as otherwise specified in a Statement of Work, Blacksand will be responsible for and supply all necessary equipment, materials, and other resources required to perform the Services.
2.5 Government Approvals. Unless otherwise specified in a Statement of Work, Hyperion is responsible for securing all government approvals and licenses necessary to allow the use of any Services and deliverables produced by Blacksand pursuant to a Statement of Work.
2.6 Other Work. Hyperion acknowledges that Blacksand is a consultant and may provide services similar to the Services on behalf of other companies in accordance with this Agreement. Subject to Section 8, and unless set forth in a Statement of Work, Blacksand shall be free to work for other companies without restriction, even if such work is done for a potentially competing company or individual, so long as Blacksand does not breach its non-solicitation, confidentiality, and other obligations in this Agreement.
3. NON-SOLICITATION
3.1 Non-Solicitation Agreement. During the term of this Agreement (including any applicable Statement of Work hereunder) and for a period of twelve (12) months following the termination of the Agreement, neither party shall, on its own behalf or on behalf of any other person or entity, without the express written consent of the other party, solicit, induce or attempt to solicit or induce, any then current employee or past employee, representative, contractor or other service provider of the other party to terminate or modify his, her or its employment or business relationship with such party. Notwithstanding the foregoing, general solicitations for employment or contracting shall not be deemed to violate this section.
3.2 Reasonableness of Restrictions. Each party regards the restrictions contained in this section as reasonable in scope and term and appropriate to provide the parties with limited, legitimate and reasonable protection against subsequent diminution of the value of the business of one party attributable to any actions of the other party in violation of such restrictions, and each party hereby waives any and all rights to attack the validity of such covenants on the grounds of the breadth of their geographic scope or the length of their term.
4. THIRD PARTY MATERIALS; THIRD PARTY IP. Unless stated otherwise in a Statement of Work, if a Statement of Work requires Blacksand to obtain, for use in connection with the Services, any material, including intellectual property, from a third party, then Blacksand will inform Hyperion of such need, and Hyperion shall be responsible, at its sole expense, to acquire rights to the third party materials.
5. COMPENSATION
5.1 Fees and Taxes. Hyperion will pay the fees as set out in each Statement of Work (“Service Fees”). Hyperion will reimburse Blacksand for any costs or expenses that have been disclosed and approved prior to being incurred. Hyperion is responsible for all taxes associated with the performance of the Services and imposed upon the Service Fees. The parties shall each be responsible for all taxes imposed on their net income. Blacksand may, at its sole option, withhold providing Services (and shall not be in breach for doing so), if Hyperion does not make timely payment as provided in this Agreement.
5.2 Payment. Unless otherwise specified in a Statement of Work: (a) Blacksand will issue quarterly invoices for Service Fees for Services that have been performed in the previous quarter; and (b) Hyperion will pay any undisputed amount set forth in such invoices no later than thirty (30) days after receipt of Blacksand’s invoice. If Hyperion disputes in good faith any amount invoiced by Blacksand within thirty (30) days after receipt of Blacksand’s invoice, the parties will pursue the escalation procedures set forth in this Agreement. If Hyperion withholds payment pursuant to this Section, Blacksand may also decline to provide further Services until the escalation procedures have been followed.
6. TERM AND TERMINATION
6.1 Term. This Agreement will commence on the Effective Date and will continue until terminated as provided in this Agreement. Any Statement of Work in existence as of the date that this Agreement terminates or expires will continue to be effective unless specifically terminated in accordance with the terms of this Agreement or the terms of the Statement of Work.
6.2 Termination. In addition to any other rights of termination in this Agreement, Hyperion may terminate this Agreement: (a) for any or no reason, upon ninety (90) days’ prior written of notice to Blacksand and (b) either party may terminate this Agreement for breach if, provided the parties have met in good faith in accordance with Section 12.4 of this Agreement to resolve any dispute, such party notifies the other party in writing of a breach of this Agreement and such breach is not cured within fifteen (15) days after written notice thereof by the non-breaching party. All of the provisions and terms of this Agreement that by their nature suggest continuance beyond termination shall survive termination of this Agreement. Within thirty (30) days after termination, the parties will return to each other any Confidential Information that belongs to the other party.
7. CONFIDENTIALITY
7.1 Definition. “Confidential Information” means any non-public information that relates to the actual or anticipated business, research, or development of either party and any proprietary information, trade secrets, and know-how of either party (the “Disclosing Party”) that are disclosed to the other party (the “Receiving Party”) or its agents, directly or indirectly, in writing, orally, or by inspection or observation of tangible items. Confidential Information includes the terms of this Agreement and any Statement of Work hereunder, research, development, and commercialization plans, customer information, processes, techniques, formulas, prototypes, and any non-public information relating to the project as outlined in any Statement of Work hereunder. Confidential Information also includes information that is defined as “Confidential Information” under any other agreement between the parties, and any other information that the Receiving Party should reasonably know to be confidential based upon its content or the circumstances surrounding its disclosure. Neither party makes any representations or warranties as to the correctness, completeness or accuracy of any Confidential Information.
7.2 Exceptions. Confidential Information does not include any information that Receiving Party can demonstrate: was publicly known and made generally available in the public domain before the Disclosing Party disclosed the information, became publicly known and made generally available, after disclosure to the Receiving Party, through no wrongful action or inaction of the Receiving Party, was in the Receiving Party’s possession, without confidentiality restrictions, at the time of disclosure by the Disclosing Party, or was independently developed without use of or reference to the Confidential Information.
7.3 Nondisclosure and Nonuse. The Receiving Party will not, during and after the term of this Agreement, disclose the Confidential Information to any third party or use the Confidential Information for any purpose other than for purposes of performing its obligations under this Agreement. Without limiting the generality of the foregoing, the Receiving Party, its affiliates, and their employees, contractors, agents, representatives, consultants, and advisors (“Representatives”) shall not: (a) use or disclose the Disclosing Party’s Confidential Information for any competitive purpose or (b) otherwise use or disclose the Disclosing Party’s Confidential Information for the pecuniary gain of themselves and/or any of their business partners. The Receiving Party will take all reasonable precautions to prevent any unauthorized use or disclosure of the Confidential Information including, but not limited to, requiring each Representative with access to Confidential Information to execute a nondisclosure agreement or policy containing terms that are substantially similar to the terms contained in this Agreement. In addition, the Receiving Party will promptly notify the Disclosing Party upon the loss or unauthorized use or disclosure of the Disclosing Party’s Confidential Information in the Receiving Party’s possession or under its control. The Receiving Party acknowledges and agrees that it shall be liable for any breach of its confidentiality obligations hereunder by its Representatives.
7.4 Existing Obligations. The obligations in this Section 7 are in addition to, and supplement, each party’s obligations of confidentiality and nondisclosure under the terms of any confidentiality or nondisclosure agreement between the parties (referred to herein, collectively, as the “NDA”).
7.5 Publications. Articles, papers, bulletins, data, studies, statistics, interim or final reports, oral transmittals or any other materials reporting the plans, progress, analyses, results, or findings of work conducted under this Agreement shall not be presented publicly or published without prior written approval by both parties.
7.6 Ownership. Subject to Section 8, each party shall retain all rights, title, and interest in and to its Confidential Information, and this Agreement shall not be construed to grant any license to such Confidential Information.
8. INTELLECTUAL PROPERTY OWNERSHIP
8.1 Unless explicitly stated in a Statement of Work or other license agreement between the parties, nothing in this Agreement represents a license of any intellectual property by one party to the other party.
8.2 Unless explicitly stated in a Statement of Work, or other license agreement between the parties and/or their affiliates, the parties do not intend for any new intellectual property created under this Agreement to be jointly owned. Each party’s intellectual property as existing as of the date of this Agreement or developed by such party after the date of this Agreement, unless otherwise stated in a Statement of Work, including any adaptions, modifications, and derivative works of the foregoing, and including all works of authorship, inventions, discoveries, improvements, methods, processes, formulas, designs, techniques, know-how, and information conceived, discovered, developed or otherwise made (as necessary to establish authorship, inventorship, or ownership) by such party (collectively, “Inventions”), will owned by the party that created or developed it. For the avoidance of doubt, Blacksand’s patented technology and all other registered intellectual property of Blacksand, and any adaptions, modifications or derivative
works thereof, shall be, and shall remain, the sole and exclusive property of Blacksand, and Blacksand grants no license or other right with respect to such Inventions to Hyperion hereunder, subject to any Statement of Work or other license agreement between the parties and/or their affiliates.
9. REPRESENTATIONS AND WARRANTIES. Each party represents and warrants: (a) that such party is a duly organized, validly existing organization as stated in the preamble to this Agreement; (b) that the transactions contemplated herein have been duly authorized by all necessary action on such party’s part; (c) that this Agreement constitutes a valid and binding obligation of such party; and (d) the execution and delivery of this Agreement by such party and the performance of such party’s obligations hereunder are not in violation or breach of, and will not conflict with or constitute a default under, any material contract, agreement, or commitment binding upon such party, including, without limitation, any non-disclosure, confidentiality, non-competition, or other similar agreement.
10. INDEMNIFICATION
10.1 Hyperion Indemnification. Hyperion agrees to indemnify, defend, and hold harmless Blacksand, its directors, managers, officers, employees, and successors and assigns from and against all taxes, losses, damages, judgments, settlements, liabilities, costs, and expenses, including attorneys’ fees and other legal expenses, arising directly or indirectly from or in connection with: (a) any negligent, reckless, or intentionally wrongful act of Hyperion or its employees or agents; (b) any breach or alleged breach of any representation, warranty or covenant of Hyperion set forth herein; and (c) raw materials provided by Hyperion to Blacksand pursuant to the terms of a Statement of Work.
10.2 Blacksand Indemnification. Blacksand agrees to indemnify, defend, and hold harmless Hyperion, its affiliates, and their directors, managers, officers, employees, and successors and assigns from and against all taxes, losses, damages, judgments, settlements, liabilities, costs, and expenses, including attorneys’ fees and other legal expenses, arising directly or indirectly from or in connection with: (a) any negligent, reckless, or intentionally wrongful act of Blacksand or its employees or agents; (b) and breach or alleged breach of any representation, warranty or covenant of Blacksand set forth herein; and (c) any third party claim that Blacksand’s intellectual property and/or materials used or provided hereunder infringes upon, misappropriates, or otherwise violates the intellectual property rights of any third party.
11. LIMITATION OF REMEDIES; DISCLAIMER
11.1 Limitation of Remedies. NOTWITHSTANDING ANYTHING TO THE CONTRARY CONTAINED IN THIS AGREEMENT, EACH PARTY WILL NOT, UNDER ANY CIRCUMSTANCES, BE LIABLE TO THE OTHER PARTY FOR CONSEQUENTIAL, INCIDENTAL, SPECIAL, PUNITIVE, OR EXEMPLARY DAMAGES ARISING OUT OF OR RELATED TO THE TRANSACTION CONTEMPLATED UNDER THIS AGREEMENT, INCLUDING BUT NOT LIMITED TO LOST PROFITS OR LOSS OF BUSINESS, EVEN IF A PARTY IS APPRISED OF THE LIKELIHOOD OF SUCH DAMAGES OCCURRING. THIS LIMITATION WILL APPLY EVEN IF THE REMEDIES AVAILABLE IN THIS AGREEMENT HAVE FAILED OF THEIR ESSENTIAL PURPOSE. EACH PARTY’S SOLE AND AGGREGATE LIABILITY UNDER THIS AGREEMENT OR ANY MATTER OR EVENT RELATED THERETO SHALL IN NO EVENT EXCEED THE SERVICE FEES PAID BY HYPERION DURING THE PRECEDING 12 MONTHS PRIOR TO THE EVENT GIVING RISE TO THE LIABILITY.
11.2 Disclaimer of Warranty. EXCEPT AS EXPRESSLY SET FORTH IN THIS AGREEMENT, EACH PARTY HEREBY DISCLAIMS ALL WARRANTIES, EXPRESS AND IMPLIED, INCLUDING BUT NOT LIMITED TO ANY IMPLIED WARRANTY OF MERCHANTABILITY, OR FITNESS FOR A PARTICULAR PURPOSE. EXCEPT AS PROVIDED HEREIN, THE DELIVERABLES AND SERVICES ARE PROVIDED AS-IS AND AS-AVAILABLE. BLACKSAND DOES NOT REPRESENT THAT THE DELIVERABLES WILL MEET HYPERION’S NEEDS OR BE ERROR-FREE.
12. MISCELLANEOUS
12.1 Services and Information Prior to Effective Date. All services performed by Blacksand and all information and other materials disclosed between the parties prior to the Effective Date will be governed by the terms of this Agreement, except where the services are covered by a separate agreement between the parties.
12.2 Independent Contractor. It is the express intention of the parties that the parties are independent contractors. Without limiting the generality of the foregoing, neither party is authorized to bind the other party to any liability or obligation or to represent that such party has any authority.
12.3 Governing Law. This Agreement will be interpreted, construed, and enforced in all respects in accordance with the laws of the State of North Carolina, without reference to its choice of law rules.
12.4 Dispute Resolution. Except with regard to disputes under Section 12.5, if a dispute arises under this Agreement, the parties agree to promptly meet, either in person or remotely, to discuss the dispute. If any such dispute cannot be resolved within fifteen (15) days, then either party shall be free to pursue its remedies as provided by law. No dispute, except a dispute under Section 12.5, shall be referred to a court before the provisions of this Section 12.4 have been followed.
12.5 Injunctive Relief. Each party acknowledges and agrees that (a) the unauthorized disclosure of the Confidential Information by the Receiving Party or (b) a breach of a party’s obligations under Section 3.1 or Section 8, may cause irreparable harm to the Disclosing Party or non-breaching Party, as applicable. As a result thereof, in addition to any other remedies available, the Disclosing Party or non-breaching Party, as applicable shall be entitled to seek injunctive and other extraordinary relief in a court of competent jurisdiction in order to enforce the breaching Party’s obligations hereunder.
12.6 Assignment; Subcontractors. This Agreement and the rights related thereto may not be assigned or otherwise transferred by either party except with the written approval of the other party, which shall not be unreasonably delayed or denied.
Subject to the foregoing, this Agreement will be binding upon and will inure to the benefit of the parties and their respective successors and assigns. Any assignment in violation of the foregoing will be null and void.
12.7 Notices. Any notice required or permitted under the terms of this Agreement or required by law must be in writing and must be: delivered in person, sent by first class registered mail, or air mail, as appropriate, or sent by overnight air courier, in each case properly posted and fully prepaid to the appropriate address as set forth below. Either party may change its address for notices by notice to the other party given in accordance with this Section 12.6. Notices will be deemed given at the time of actual delivery in person, three business days after deposit in the mail as set forth above, or one day after delivery to an overnight air courier service.
12.8 Waiver. Any waiver of the provisions of this Agreement or of a party’s rights or remedies under this Agreement must be in writing to be effective. Failure, neglect, or delay by a party to enforce the provisions of this Agreement or its rights or remedies at any time, will not be construed as a waiver of the party’s rights under this Agreement and will not in any way affect the validity of the whole or any part of this Agreement or prejudice the party’s right to take subsequent action. Exercise or enforcement by either party of any right or remedy under this Agreement will not preclude the enforcement by the party of any other right or remedy under this Agreement or that the party is entitled by law to enforce.
12.9 Severability. If any term, condition, or provision in this Agreement is found to be invalid, unlawful, or unenforceable to any extent, the parties will endeavor in good faith to agree to amendments that will preserve, as far as possible, the intentions expressed in this Agreement. If the parties fail to agree on an amendment, the invalid term, condition, or provision will be severed from the remaining terms, conditions, and provisions of this Agreement, which will continue to be valid and enforceable to the fullest extent permitted by law.
12.10 Counterparts. This Agreement may be executed in counterparts, each of which will be deemed to be an original and together will constitute one and the same agreement. This Agreement may also be delivered by facsimile or e-mail and such delivery will have the same force and effect of an original document with original signatures.
12.11 Headings. Headings are used in this Agreement for reference only and will not be considered when interpreting this Agreement.
12.12 Integration. This Agreement and all exhibits contain the entire agreement of the parties with respect to the subject matter of this Agreement and supersede all previous communications, representations, understandings, and agreements, either oral or written, between the parties with respect to the subject matter hereof, except that any NDA will remain in effect in accordance with its terms. No terms, provisions, or conditions of any purchase order, acknowledgement, or other business form that either party may use in connection with the transactions contemplated by this Agreement will have any effect on the rights, duties, or obligations of the parties under, or otherwise modify, this Agreement, regardless of any failure of a receiving party to object to these terms, provisions, or conditions. This Agreement may not be amended, except by a writing signed by both parties.
12.13 Force Majeure. Neither party will be in breach or default of this Agreement by reason of its delay or failure to meet any obligation hereunder due to any event, circumstance, or cause beyond its control such as but not limited to: governmental regulation, acts of nature or terrorism, or failures of public infrastructure, and similar events, circumstances, or causes, so long as the affected party provides prompt notice thereof to the non-affected party. The affected party will be excused from performance for as long as such force majeure event prevents such party from performing its obligations under this Agreement; provided, however, that in the event a force majeure event exceeds sixty (60) days in duration, the non-affected party may immediately terminate this Agreement and/or any Statement of Work hereunder upon notice to the affected party without any further liability except: (i) to pay any amounts due and payable to the other party as of the date of termination and (ii) with regard to any provisions of this Agreement which survive termination.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the Effective Date.
HYPERION: | BLACKSAND: | |
HYPERION MATERIALS & TECHNOLOGIES, LLC | BLACKSAND TECHNOLOGY LLC |
Name: | Anastasios Arima | Name: | Kesh Keshavan |
Title: | Manager | Title: | President |
Signature: | /s/ Anastasios Arima | Signature: | /s/ Kesh Keshavan | |
Address for Notice: [***] | Address for Notice: [***] | |||
SCHEDULE 1
STATEMENT OF WORK
Statement of Work #: 1 | Effective From: February 13, 2021 (the “SOW Effective Date”) |
This Statement of Work forms part of the Master Services Agreement dated February 13, 2021 (the “MSA”) by and between Blacksand Technology LLC, a Utah limited liability company (“Blacksand”), and Hyperion Materials & Technologies, LLC, a North Carolina limited liability company (“Hyperion”). Capitalized terms not otherwise defined herein shall have the definitions set forth in the MSA.
During the term of this Statement of Work, Blacksand will provide the following R&D services:
Notes:
Hyperion will provide the enriched titanium ore (i.e. the product equivalent to upgraded Ti slag (UGS)), or supply Blacksand commercially available titanium slag; provided that, during Phase 2 and Phase 3, Blacksand shall have the option to purchase enriched titanium ore from a third party at Hyperion’s sole discretion and expense.
1. | TERM |
The term of this Statement of Work shall commence on the SOW Effective Date and shall continue until the earlier of (a) termination as provided in the MSA or (b) completion of the scope of R&D services set forth in the table above (the “SOW Term”); provided that, should the SOW Term extend beyond the two year anniversary of the SOW Effective Date, Hyperion shall continue to pay Blacksand $47,500 for each such quarter until expiration of the SOW Term. In addition, either party may terminate this Statement of Work upon thirty (30) days’ written notice to the other party if any phase described in the table above is mutually and reasonably determined to be unsuccessful.
The parties agree that for purposes of interpretation of Section 1.3 of the MSA – “Delays” – the schedule for the R&D Services above is indicative only and subject to change based on input from potential suppliers, vendors and subcontractors to Blacksand. Upon consultation with such third parties, Blacksand and Hyperion will discuss in good faith and agree to update the execution schedule as may be required.
2. | SERVICE FEES |
In consideration of the Services performed by Blacksand during the SOW Term, Hyperion shall pay to Blacksand a fixed price of $480,000 (Four Hundred Eighty Thousand US Dollars) (the “Original Amount”) as follows:
● | $72,500 due and payable upon the Effective Date. |
● | $47,500 due and payable quarterly (every three months), beginning May 1, 2021. |
● | $75,000 as a one-time payment upon completion of Phase I and commencement of Phase II, as described below. |
Additionally, in the event the term of this Statement of Work renews for additional periods under Section 1 above or by mutual agreement of the parties, Hyperion will pay Blacksand the additional compensation set forth in Section 1 above.
In addition to the foregoing, Hyperion shall also be responsible for the cost of the ARH equipment that may be required to make 200 kg of TiO2 to yield 100 kg of Ti powder.
For the avoidance of doubt:
a) | The rates stated above are exclusive of taxes. |
b) | Hyperion will be responsible for and will promptly pay all taxes (including but not limited to sales, services, export and use taxes) associated with this Agreement or Hyperion’s receipt of the Services, except taxes based on Blacksand’s net income and taxes related to Blacksand’s employees. |
c) | The rates stated in this Statement of Work shall be valid for a period of two (2) years from the SOW Effective Date. Revised rates shall be mutually agreed by the parties in writing. |
d) | A finance charge shall be imposed on all undisputed account balances outstanding over 30 days. The finance charge is [***] per month or the highest rate allowed by applicable law, whichever is lower. |
e) | Ninety (90) days prior to the commencement of Phase 3 of this Statement of Work, Blacksand will prepare an estimated capital cost for the cost of the ARH equipment which will be required to execute the Phase 3 scope of work. The parties shall work in good faith to agree on an approved budget and the parties will negotiate and execute a change notice to this Statement of Work to cover the cost of the Phase 3 equipment. |
f) | Other than the Phase 3 equipment, Blacksand will perform the Statement of Work on a fixed price basis. Any work not contemplated by this Statement of Work may be completed by change notice, or by a separate Statement of Work. Prior to undertaking any additional work, Blacksand will prepare an estimated cost and schedule for the additional work. Blacksand will obtain prior written approval from Hyperion prior to performing any additional work, otherwise Hyperion shall have no obligation to reimburse Blacksand for such unapproved expense. |
3. | OPTION/LICENSE AGREEMENT |
At any time during the term of the MSA, subject to Hyperion’s compliance with the MSA and this Statement of Work, and conditioned on Hyperion having paid the Original Amount in full, Hyperion shall have the right, but not the obligation, to exercise the option, and acquire the License, as set forth in that certain “Option for Exclusive License Agreement Between Hyperion Materials & Technologies, LLC and Blacksand Technology, LLC” (“License Agreement”), of even date herewith and attached as Exhibit A. In furtherance of this right, during the term of the MSA, Blacksand covenants and agrees (a) not to take any action that would be inconsistent with the License Agreement and (b) to use its reasonable best efforts from taking any action that would prevent Blacksand from making any of the representations or warranties, or making and complying with any of the covenants, set forth in the License Agreement.
IN WITNESS WHEREOF, the parties hereto have executed this Statement of Work as of the SOW Effective Date.
HYPERION: | BLACKSAND: | |
HYPERION MATERIALS & TECHNOLOGIES, LLC | BLACKSAND TECHNOLOGY, LLC |
Name: | Anastasios Arima | Name: | Kesh Keshavan |
Title: | Manager | Title: | President |
Signature: | /s/ Anastasios Arima | Signature: | /s/ Kesh Keshavan | |
STATEMENT OF WORK # 2
Statement of Work #: 2 | Effective From: June 1, 2021 (the “SOW Effective Date”) |
This Statement of Work forms part of the Master Services Agreement dated February 13, 2021 (the “MSA”) by and between Blacksand Technology LLC, a Utah limited liability company (“Blacksand”), and Hyperion Materials & Technologies, LLC, a North Carolina limited liability company (“Hyperion”). Capitalized terms not otherwise defined herein shall have the definitions set forth in the MSA.
During the term of this Statement of Work, Blacksand will provide the following services:
● | Supply to Hyperion 500-900 kg Ti-6Al-4V powder using GSD technology over the course of two (2) years. Blacksand shall supply 20-45 kg of powder monthly. |
● | Powder shall be made according to widely accepted specifications (ASTM F2924 and AMS 4998, for example) or customized requirements of chemistry and size distributions based on end-user specifications to be provided by Hyperion. |
● | Blacksand will use existing pilot plant and provide resources to produce the powder. |
During the term of this Statement of Work Hyperion will provide the following:
● | Define requirements for powder to meet the specifications of end-user/customer needs or inventory build. |
● | Supply raw material (Ti scrap) for use in GSD manufacturing. |
The parties agree that this scope of services may be expanded upon agreement of the parties to cover recycling of AM powder. The parties also agree that certain pilot scale capital equipment may be required during the execution of this SOW. Hyperion will provide funding for the purchase of such equipment upon mutual agreement of the parties.
1. | TERM |
The term of this Statement of Work shall commence on the SOW Effective Date and shall continue until the earlier of (a) termination as provided in the MSA (b) completion of the scope services set forth in the table above, or (c) two (2) years after the SOW Effective Date (the “SOW Term”).
2. | SERVICE FEES |
In consideration of the Services performed by Blacksand during the SOW Term, Hyperion shall pay to Blacksand a fixed price of $1,200,000 (One Million Two Hundred Thousand US Dollars) (the “Original Amount”) for two (2) years, with $150,000 due and payable upon the Effective Date, and $150,000 due and payable quarterly thereafter (every three months).
For the avoidance of doubt:
g) | The rates stated above are exclusive of taxes. |
h) | Hyperion will be responsible for and will promptly pay all taxes (including but not limited to sales, services, export and use taxes) associated with this Agreement or Hyperion’s receipt of the Services, except taxes based on Blacksand’s net income and taxes related to Blacksand’s employees. |
i) | The rates stated in this Statement of Work shall be valid for a period of two (2) years from the SOW Effective Date. Revised rates shall be mutually agreed by the parties in writing. |
j) | A finance charge shall be imposed on all undisputed account balances outstanding over 30 days. The finance charge is [***] per month or the highest rate allowed by applicable law, whichever is lower. |
k) | Blacksand will perform the Statement of Work on a fixed price basis. Any work not contemplated by this Statement of Work may be completed by change notice, or by a separate Statement of Work. Prior to undertaking any additional work, Blacksand will prepare an estimated cost and schedule for the additional work. Blacksand will obtain prior written approval from Hyperion prior to performing any additional work, otherwise Hyperion shall have no obligation to reimburse Blacksand for such unapproved expense. |
3. | OPTION/LICENSE AGREEMENT |
At any time during the term of the MSA, subject to Hyperion’s compliance with the MSA and this Statement of Work, and conditioned on Hyperion having paid the Original Amount in full, Hyperion shall have the right, but not the obligation, to exercise the option, and acquire the License, as set forth in that certain “Option for Exclusive License Agreement Between Hyperion Materials & Technologies, LLC and Blacksand Technology, LLC” (“License Agreement”), of even date herewith and attached as Exhibit A. In furtherance of this right, during the term of the MSA, Blacksand covenants and agrees (a) not to take any action that would be inconsistent with the License Agreement and (b) to use its reasonable best efforts from taking any action that would prevent Blacksand from making any of the representations or warranties, or making and complying with any of the covenants, set forth in the License Agreement.
IN WITNESS WHEREOF, the parties hereto have executed this Statement of Work #2 as of the SOW Effective Date.
HYPERION: | BLACKSAND: | |
HYPERION MATERIALS & TECHNOLOGIES, LLC | BLACKSAND TECHNOLOGY, LLC |
Name: | Anastasios Arima | Name: | Kesh Keshavan |
Title: | Manager | Title: | President |
Signature: | /s/ Anastasios Arima | Signature: | /s/ Kesh Keshavan | |
-2-
Exhibit 4.4
IPERIONX LIMITED
ACN 618 935 372
Employee INCENTIVE Plan
Adopted by Shareholders on April 14, 2021
CONTENTS
1 | PURPOSE | 2 |
2 | Commencement | 2 |
3 | Maximum allocation | 2 |
4 | Eligibility and grant | 2 |
5 | Operation of Plan | 4 |
6 | EMPLOYEE SHARE TRUST | 5 |
7 | Quotation | 5 |
8 | Lapse of Options and performance rights | 5 |
9 | Issue of Shares | 7 |
10 | Rights attaching to Shares | 8 |
11 | NOMINEE | 8 |
12 | Good Leaver | 8 |
13 | Bad Leaver | 9 |
14 | Fraudulent or dishonest actions | 9 |
15 | Buy-Back | 11 |
16 | Buy-Back price | 11 |
17 | Holding lock | 12 |
18 | tax liability and withholding | 12 |
19 | Contravention of Applicable Laws | 12 |
20 | Contravention of Rules | 12 |
21 | Administration of the Plan | 12 |
22 | Plan amendment | 14 |
23 | Termination or suspension | 15 |
24 | No employment contract | 15 |
25 | ASIC relief | 16 |
26 | Non-exclusivity | 16 |
27 | General | 16 |
28 | PROVISIONS SPECIFIC TO UNITED STATES | 17 |
29 | Definitions and interpretation | 20 |
SCHEDULE 1: terms and conditions of options | 26 | |
SCHEDULE 2: terms and conditions of performance rights | 32 | |
SCHEDULE 3: PRO-FORMA OFFER LETTER - OPTIONS | 36 | |
SCHEDULE 4: PRO-FORMA OFFER LETTER - PERFORMANCE RIGHTS | 42 |
1 | PURPOSE |
1.1 | The purpose of the Plan is to: |
1.1.1 | assist in the reward, retention and motivation of Eligible Employees; |
1.1.2 | link the reward of Eligible Employees to Shareholder value creation; and |
1.1.3 | align the interests of Eligible Employees with Shareholders by providing an opportunity to Eligible Employees to earn rewards via an equity interest in the Company based on creating Shareholder value. |
2 | Commencement |
2.1 | The Plan will commence on a date determined by resolution of the Board (and if no date is specified, on the date the Plan is approved by the Board). |
3 | Maximum allocation |
3.1 | An Offer of Options or Performance Rights may only be made under this plan if the number of Shares that may be acquired on exercise of the Options and Performance Rights when aggregated with the number of Shares issuable if each outstanding Option and Performance Right were exercised and the number of Shares issued pursuant to the Plan or any other Group employee incentive scheme during the previous 3 years does not exceed 10% of the total number of Shares on issue at the time of the proposed issue. |
3.2 | For the avoidance of doubt, where an Employee Incentive lapses without being exercised, the Employee Incentive concerned shall be excluded from any calculation under this clause 3. |
3.3 | The maximum allocation and allocated pool provided for in this clause 3 may be increased by Board resolution, provided such an increase complies with the Listing Rules. |
4 | Eligibility and grant |
Participation
4.1 | The Board may from time to time in its sole and absolute discretion determine that an Eligible Employee may participate in the Plan. |
Selection
4.2 | Following determination that an Eligible Employee may participate in the Plan, the Board may at any time, and from time to time, make an Offer to the Eligible Employee. |
Offer
4.3 | Subject to clause 4.4, the manner, form, content, timing and frequency of Offers will be as determined by the Board in its sole and absolute discretion. |
4.4 | An Offer must be set out in an Offer Letter delivered to the Eligible Employee. The Offer Letter may specify (as determined by the Board): |
2 |
4.4.1 | the number of Options or Performance Rights; |
4.4.2 | the conditions on the Offer (Offer Conditions); |
4.4.3 | the Grant Date; |
4.4.4 | the Fee (if any); |
4.4.5 | the Performance Criteria (if any); |
4.4.6 | the Vesting Conditions (if any); |
4.4.7 | the Exercise Price (if any); |
4.4.8 | the Exercise Period (if applicable); |
4.4.9 | the Performance Period (if applicable); and |
4.4.10 | the Expiry Date and Term (if applicable). |
4.5 | An Offer must be accompanied by an Application, the terms and conditions of the relevant Employee Incentive and a copy of this Plan. |
4.6 | Pro-forma Offer Letters and pro-forma Applications are attached as Schedules 3 to 4 (as applicable) of this Plan, respectively. |
Application
4.7 | Unless otherwise determined by the Board in its sole and absolute discretion, an Eligible Employee that wishes to apply to participate in the Plan in response to an Offer must, on or before the period of time allowed for acceptance of the Offer, give an Application: |
4.7.1 | to the person specified in the Offer Letter; and |
4.7.2 | in accordance with any instructions or conditions set out in the Offer Letter. |
4.8 | An Eligible Employee may accept less than the total number of Employee Incentives in an Offer. |
Multiple Offers
4.9 | Unless otherwise determined by the Board in its sole and absolute discretion, the Board may make any number of issues to Eligible Employees, as set out in any Offer, notwithstanding that an issue or issues may have been previously made to any Eligible Employee. |
Right to Reject Applications
4.10 | The Board is entitled to reject any Application by an Eligible Employee to participate in this Plan without giving any reason. |
Acceptance of Offer
4.11 | A person to whom an Offer is made may accept the Offer by completing the Application and giving it to the Board by 5:00pm on the last day of the acceptance period specified in the Offer Letter. |
3 |
4.12 | Unless an Eligible Employee is notified otherwise by the Board, an Eligible Employee's Application is accepted by the Board upon receipt. |
4.13 | Once that notice is given, a contract is formed under which an Eligible Employee and Company: |
4.13.1 | become bound by the terms and conditions of the Offer Letter, this Plan, the terms and conditions of the relevant Employee Incentive and the Company's Constitution; |
4.13.2 | the Eligible Employee agrees to the issue of the Employee Incentives from the Company in accordance with the terms and conditions of the Eligible Employee’s Application; and |
4.13.3 | the Company agrees to issue the Employee Incentives to the Eligible Employee in accordance with the terms and conditions of the Eligible Employee’s Application. |
4.14 | In accordance with the Company's reporting obligations under Australian and other tax legislation, each participant consents to the disclosure of information about this Plan and its participants to the Australian Tax Office or another tax authority. |
5 | Operation of Plan |
5.1 | This Plan is administered by the Board, which has power to: |
5.1.1 | determine appropriate procedures for administration of this Plan consistent with this Plan; |
5.1.2 | resolve conclusively all questions of fact or interpretation in connection with this Plan; |
5.1.3 | appoint a person to be the Plan Administrator; |
5.1.4 | delegate to any persons (including, without limitation, a Plan Administrator) for such period and on such terms as it sees fit the exercise of any of its powers or discretions under this Plan; and |
5.1.5 | take and rely on independent professional or expert advice in or in relation to the exercise of any of its powers or discretions under this Plan. |
5.2 | Where the Board is to make a determination, decision, approval or give any opinion under this Plan, the Board or the Company may do so in its absolute discretion. |
5.3 | Any power or discretion which is conferred on the Board or the Company by this Plan may be exercised by the Board in the interests, or for the benefit, of the Company and the Board is not, in exercising any such power or discretion, under any fiduciary or other obligation to any other person including, for the avoidance of doubt, any Eligible Employee or any Participant. |
4 |
6 | EMPLOYEE SHARE TRUST |
6.1 | The Board may in its sole and absolute discretion use an employee share trust or other mechanism for the purposes of holding Shares for Participants under the Plan and delivering Shares to Participants upon exercise of the Options or the vesting of a Performance Right. |
7 | Quotation |
7.1 | The Company will not seek official quotation of any Options or Performance Rights. |
7.2 | The Company must use all reasonable endeavours to obtain the grant of quotation of Shares issued on exercise of Options or conversion of Performance Rights under this Plan on the ASX and, subject to Listing Rules, on any other exchange on which Shares are quoted. This is subject to there being no applicable trading restrictions under: |
7.2.1 | this Plan; |
7.2.2 | the Listing Rules; or |
7.2.3 | the Corporations Act 2001 (Cth). |
8 | Lapse of Options and performance rights |
When do Options and Performance Rights lapse?
8.1 | Subject to clause 8.2 or the Board deciding otherwise, a Participant's Options and/or Performance Rights shall automatically be cancelled for no consideration on the earliest to occur of the following: |
8.1.1 | the cessation of employment or office of a Participant with the Company or any member of the Group (other than in accordance with clause 12); |
8.1.2 | where clause 14 applies; |
8.1.3 | if applicable Performance Criteria and/or Vesting Conditions are not achieved by the relevant time; |
8.1.4 | if the Board determines in its reasonable opinion that the applicable Performance Criteria and/or Vesting Conditions have not been met or cannot be met prior to the Expiry Date or the end of the Performance Period (as applicable); |
8.1.5 | the Expiry Date; |
8.1.6 | where the Board has determined that the Participant has, by any act or omission, brought the Group into disrepute or acted contrary to the interests of the Company or the Group; |
8.1.7 | the receipt by the Company of notice from the Participant (after a Special Circumstance has arisen with respect to the Participant) that the Participant has elected to surrender the Employee Incentive; or |
8.1.8 | any other circumstances specified in any Offer Letter pursuant to which the Employee Incentive were issued. |
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Discretion of Board
8.2 | The Board may decide to allow a Participant to: |
8.2.1 | retain and exercise any or all of their Options, whether or not the Vesting Conditions or Performance Criteria (as applicable) have been satisfied, and whether or not the Options would otherwise have lapsed, provided that no Options will be capable of exercise later than the relevant Expiry Date for those Options; and |
8.2.2 | retain any Performance Rights regardless of: |
8.2.2.1 | the expiry of the Performance Period to which those Performance Rights relate; or |
8.2.2.2 | any failure by the Participant to satisfy in part or in full the Performance Criteria or Vesting Conditions (as applicable) specified by the Board in respect of those Performance Rights; |
in which case, the Board may:
8.2.2.3 | determine that any or all of those retained Performance Rights shall vest and the corresponding Shares shall be provided to the Eligible Employee; or |
8.2.2.4 | determine a new Performance Period or Vesting Conditions (as applicable) for those retained Performance Rights and notify the Participant of the determination as soon as practicable. |
Determination Whether to Exercise Discretion
8.3 | The Board may have regard to whatever matters it thinks reasonable when making a decision about the matters in clause 8.2 with respect to a Participant, including any of the following factors: |
8.3.1 | the reason for the cessation of employment with the Company, or any member of the Group; |
8.3.2 | the length of time between the date of cessation of employment and the Expiry Date; |
8.3.3 | the Participant's reasons for any failure to satisfy any Performance Criteria; |
8.3.4 | the total length of service of the person as an employee with the Company, or any member of the Group; |
8.3.5 | if the cessation of employment is related to the person's performance, then the extent to which the person has been given warning of their performance inadequacies; |
8.3.6 | information provided by the person to the Board to support any claim to exercise the discretion in the person's favour; or |
8.3.7 | Applicable Law. |
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Effect of Lapse
8.4 | All rights of a Participant under this Plan in respect of an Option or Performance Right cease upon the Option or Performance Right lapsing. No consideration or compensation will be payable to any person in relation to that lapse. |
8.5 | The Company will, with respect to any Option or Performance Right that has lapsed in accordance with this clause 8: |
8.5.1 | notify the Participant that the relevant Options or Performance Rights held by them have lapsed; |
8.5.2 | arrange for the Participant or the Participant's agent or attorney to sign any transfer documents as may be required to transfer or otherwise deal with the Options or Performance Rights; and |
8.5.3 | not be liable for any damages, compensation or other amounts to the Participant in respect of the Options or Performance Rights. |
9 | Issue of Shares |
Issue of Shares
9.1 | The Company will issue Shares or acquire and transfer Shares directly to the Eligible Employee where Shares are to be provided under this Plan, unless the Board determines otherwise. |
Overriding restrictions on Shares
9.2 | Participants must not deal with Shares if to do so would contravene Applicable Laws. |
9.3 | The Board must not issue and allot any Shares under this Plan to a person if the issue of the Shares is prohibited or would contravene Applicable Laws, including if prohibited under the Corporations Act without a disclosure document, product disclosure statement or similar document or if the Company is required to obtain shareholder approval for the issue of the Shares. |
Issuer sponsored holding for Shares
9.4 | Unless the Board determines otherwise (in its absolute discretion), all Shares issued under this Plan including Shares issued on exercise of any Options or conversion of any Performance Rights: |
9.4.1 | will be issued on the issuer sponsored sub-register maintained by the Company; and |
9.4.2 | the Participant must keep the Shares issued on the issuer sponsored sub-register while they remain employed by the Company or any member of the Group. The Company is entitled to impose a holding lock pursuant to clause 17 if any Participant attempts to transfer their shares from the Company's issued sponsored sub-register in breach of this clause 9.4.2. |
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10 | Rights attaching to Shares |
Shares to Rank Equally
10.1 | Any Shares allotted, issued or transferred by the Company to a Participant under the Plan will rank equally with all existing Shares, including those Shares issued, directly, under this Plan, on and from the date of allotment, issue or transfer in respect of all rights and bonus issues, and dividends which have a record date for determining entitlements on or after the date of allotment, issue, or transfer of those Shares. |
11 | NOMINEE |
11.1 | Unless expressly permitted in the Offer or by the Board, an Eligible Employee may only submit an Application in the Eligible Employee's name and not on behalf of any other person. |
11.2 | If an Eligible Employee is permitted in the Offer or by the Board, the Eligible Employee may nominate a Related Party to be issued the Options or Performance Rights the subject of the Offer. The nominated Related Party must execute any documents required by the Company in order to receive the grant of the Options or Performance Rights. |
11.3 | If Options or Performance Rights are granted to a Related Party nominated by an Eligible Employee, then to the extent necessary to give effect to these Rules, the Eligible Employee will continue to be treated as the Participant. |
11.4 | If a Participant ceases to Control its Related Party to whom Options or Performance Rights have been granted under these Rules, then that Related Party must immediately transfer all Options or Performance Rights held by it to the Participant. Each of the Participant and the Related Party will do (and hereby authorise the Company and its officers and agents to do) all things necessary, including executing all documentation necessary, to give effect to this clause. |
12 | Good Leaver |
12.1 | Subject to clause 12.2, where a Participant who holds Employee Incentives becomes a Good Leaver: |
12.1.1 | all vested Options which have not been exercised in accordance with these Rules will continue in force and remain exercisable for 90 days after the date the Participant becomes a Good Leaver, unless the Board determines otherwise in its sole and absolute discretion, after which the Options will lapse; and |
12.1.2 | the Board may at any time, in its sole and absolute discretion (subject to the Corporations Act and ASX Listing Rules), do one or more of the following: |
12.1.2.1 | permit unvested Employee Incentives held by the Good Leaver to vest; |
12.1.2.2 | permit such unvested Employee Incentives held by the Good Leaver or his or her nominee(s) to continue to be held by the applicable holder, with the Board having the discretion to amend the vesting criteria (including any Offer Conditions, Performance Criteria or Vesting Conditions) or reduce the exercise period of such unvested Employee Incentives; or |
12.1.2.3 | determine that the unvested Employee Incentives will lapse. |
12.2 | Where a person is a Good Leaver due to a Special Circumstance, the Nominated Beneficiary shall be entitled to benefit from any exercise of the above discretionary powers by the Board. |
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13 | Bad Leaver |
13.1 | Where a Participant who holds Employee Incentives becomes a Bad Leaver: |
13.1.1 | unless the Board determines otherwise, in its sole and absolute discretion, all vested and unvested Employee Incentives will lapse; and |
13.1.2 | the Board may determine to exercise the right to buy back any Shares issued upon exercise of an Option or conversion of a Performance Rights in accordance with clause 15. |
14 | Fraudulent or dishonest actions |
Fraudulent or Dishonest Actions
14.1 | Where, in the reasonable opinion of the Board, a Participant or Former Participant (which for the avoidance of doubt may include a Good Leaver): |
14.1.1 | acts fraudulently or dishonestly; |
14.1.2 | wilfully breaches his or her duties to the Company or any member of the Group; or |
14.1.3 | has, by any act or omission, in the opinion of the Board (determined in its absolute discretion): |
14.1.3.1 | brought the Company, the Group, its business or reputation into disrepute; or |
14.1.3.2 | is contrary to the interest of the Company or the Group. |
14.1.4 | commits any material breach of the provisions of any employment contract entered into by the Participant with any member of the Group; |
14.1.5 | commits any material breach of any of the policies of the Group or procedures or any laws, rules or regulations applicable to the Company or Group; |
14.1.6 | is subject to allegations, has been accused of, charged with or convicted of fraudulent or dishonest conduct in the performance of the Participant's (or Former Participant's) duties, which in the reasonable opinion of the relevant directors of the Group effects the Participant's suitability for employment with that member of the Group, or brings the Participant or the relevant member of the Group into disrepute or is contrary to the interests of the Company or the Group; |
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14.1.7 | is subject to allegations, has been accused of, charged with or convicted of any criminal offence which involves fraud or dishonesty or any other criminal offence which Board determines (in its absolute discretion) is of a serious nature; |
14.1.8 | has committed any wrongful or negligent act or omission which has caused any member of the Group substantial liability; |
14.1.9 | has become disqualified from managing corporations in accordance with Part 2D.6 of the Corporations Act or has committed any act that, pursuant to the Corporations Act, may result in the Participant being banned from managing a corporation; |
14.1.10 | has committed serious or gross misconduct, wilful disobedience or any other conduct justifying termination of employment without notice. |
14.1.11 | has wilfully or negligently failed to perform their duties under any employment contract entered into by the Participant with any member of the Group; |
14.1.12 | has engaged in a transaction which involves a conflict of interest to their employment with the Company resulting in the Participant or Former Participant obtaining a personal benefit; |
14.1.13 | accepts a position to work with a competitor of the Company or Group; |
14.1.14 | acting in such a manner that could be seen as being inconsistent with the culture and values of the Company or the Group; or |
14.1.15 | any other act that the Board determines in its absolute discretion to constitute fraudulent or dishonest by the Participant or Former Participant for the purposes of this clause 14, |
then the Board may (in its absolute discretion) deem all Employee Incentives held by the Participant or Former Participant will automatically be forfeited.
When Forfeiture Occurs
14.2 | Where any Employee Incentives are subject to forfeiture pursuant to clause 14.1, the Company will: |
14.2.1 | notify the Participant or Former Participant that the relevant Employee Incentives held by them have been forfeited; |
14.2.2 | cancel any Employee Incentives, Buy Back any Employee Incentives pursuant to clause 15 or arrange for the Participant's agent or attorney to sign any transfer documents required to transfer or rely on clauses 21.6 and 21.7 and otherwise deal with the relevant Employee Incentives as the Board determines in its absolute discretion; and |
14.2.3 | not be liable for any damages, compensation or other amounts to the Participant in respect of the relevant Employee Incentives that were subject to such forfeiture. |
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15 | Buy-Back |
Buy-Back
15.1 | Subject to any Applicable Laws, Employee Incentives issued pursuant to this Plan will be subject to the Company's right to Buy-Back and may at any time be immediately Bought-Back by the Company if: |
15.1.1 | the Participant holding the Employee Incentives ceases employment or office where the Offer Conditions, Performance Criteria and/or Vesting Conditions attaching to the Employee Incentives have not been met by the time of cessation. The time of cessation of employment or office shall be the time as determined by the Board in its sole discretion; |
15.1.2 | where clause 13 applies; |
15.1.3 | where clause 14 applies; |
15.1.4 | where clause 8 applies; or |
15.1.5 | if the Board determines in its reasonable opinion that the applicable Performance Criteria and/or Vesting Conditions have not been met by the end of the Expiry Date. |
15.2 | The Buy-Back of Employee Incentives under clause 15.1 may occur in one or more tranches within such time, as determined by the Board in its sole and absolute discretion. |
Buy-Back Mechanism
15.3 | Each Participant is deemed to agree to sell such Employee Incentives to the Company and will do all acts, matters and things at any time which are necessary or desirable in the sole opinion of the Board to give effect to any Buy-Back of his or her Employee Incentives, including but not limited to: |
15.3.1 | authorising and appointing the company secretary holding office at the relevant time (or their delegate) as their agent or attorney to sell the Employee Incentives; or |
15.3.2 | where any Option, Performance Right, or Share transferred or issued to the Participant or any Shares resulting from exercise of said Options and/or Performance Rights have been sold by the Participant, require the Participant to pay all or part of the proceeds received from the sale of any Employee Incentives to the Company; or |
15.4 | If there are insufficient proceeds received by the Company from the sale of Employee Incentives, the Participant will owe a debt to the Company for the value of the Employee Incentives. |
16 | Buy-Back price |
16.1 | Unless determined otherwise by the Board in its absolute discretion, the total price on which all Employee Incentives held by a Participant may be Bought-Back by the Company is an aggregate of $1.00 for all the relevant Employee Incentives (Buy-Back Price). |
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17 | Holding lock |
17.1 | The Board may at any time request that the Company's share registry to impose a holding lock on any Employee Incentives issued pursuant to this Plan where the Board determines or reasonably believes (in its absolute discretion) that a Participant (or a Former Participant while they were employed by the Company or a member of the Group) has or may breach these Rules. A holding lock shall not be imposed in violation of Code Section 409A, as applicable. |
18 | tax liability and withholding |
18.1 | The ultimate responsibility and liability for any and all taxes belongs to and shall remain with the Participant, and any tax consequences arising from the grant or exercise of any Performance Right or Option, from the payment of Shares covered thereby, or from any other event or act relating to the Performance Rights, Options, or Shares issued upon exercise thereof, shall be borne solely by the Participant. The Company makes no representations or undertaking regarding the tax treatment of any grant, issuance or exercise of any Performance Rights, Options, or Shares. |
18.2 | The Company may withhold any such number of Performance Rights, Options, or Shares to be issued to the Participant which may be required to be withheld by any Applicable Law or to satisfy the Participant's tax obligations under clause 18.1. |
19 | Contravention of Applicable Laws |
19.1 | No act will be done or determination made in accordance with these Rules where to do so would be a breach of any Applicable Laws, and where any such act is done or determination made it will be considered void and to the extent possible be unwound and of no effect in respect of Employee Incentives. |
20 | Contravention of Rules |
20.1 | The Board may at any time, in its sole and absolute discretion, take any action it deems reasonably necessary in relation to any Employee Incentives if it determines or reasonably believes a Participant has breached these Rules or the terms of issue of any Employee Incentives, including but not limited to, signing transfer forms in relation to Employee Incentives, placing a holding lock on Employee Incentives pursuant to clause 17, signing any and all documents and doing all acts necessary to effect a Buy-Back, accounting for the proceeds of the sale of forfeited Employee Incentives, refusing to transfer any Employee Incentives and/or refusing to issue any Shares. |
21 | Administration of the Plan |
Regulations
21.1 | The Board may make such regulations for the operation of the Plan as it considers necessary, provided such regulations are consistent with these Rules. |
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Delegation
21.2 | The Board may delegate any of its powers or discretions conferred on it by these Rules to a committee of the Board or to any one or more persons selected by it, including but not limited to the company secretary. |
21.3 | Any delegation will be for such period and upon such terms and conditions as determined by the Board from time to time. |
Decisions Final
21.4 | Subject to clause 21.5, every exercise of a discretion by the Board (or its delegates) and any decision by the Board (or its delegates) regarding the interpretation, effect or application of these Rules will be final, conclusive and binding and may not be subsequently reversed or changed by the Board (or its delegates) without the Participant's or Former Participant's consent. |
21.5 | Unless the Board (or its delegates) has resolved to make an irrevocable exercise of their discretion or made an irrevocable determination, the exercise of any discretion or decision by the Board (or its delegates) under these Rules does not prevent the Board (or its delegates) from subsequently exercising its powers under clauses 14 to 17 (inclusive) if any of the circumstances described in clause 14 is found to apply to a Participant or Former Participant, including, but not limited to, if the Board (or its delegates) has previously determined that a Participant was a Good Leaver under these Rules. |
Attorney and Agent
21.6 | Each Participant hereby authorises and appoints the company secretary holding office at the relevant time (or their delegate) as their agent or attorney with power to do all things necessary in the name of and on behalf of the Participant to give effect to these Rules, including and without limitation, signing Option or Share transfer forms, requesting the Company’s share registry to place a holding lock on any Employee Incentives, signing all documents and doing all acts necessary to effect a Buy-Back, and accounting for the proceeds of the sale of forfeited Employee Incentives, but expressly excluding the power to exercise Options granted to the Participant under the Plan. |
21.7 | Each Participant agrees to indemnify and hold harmless any person acting as their agent or attorney in accordance with these Rules in respect of all costs, damages, or losses of whatever nature arising from so acting, other than costs, damages, or losses arising from the agent's or the attorney's dishonesty, fraud, or wilful breach of their duties. |
Notice
21.8 | Address for service: |
21.8.1 | Any notice required to be given to the Participants under the Plan will be sent to the address of the Participant as entered in the register unless delivered in person. |
21.8.2 | Any notice required to be given to the Company under the Plan will be sent to the registered office of the Company or such other address as is notified to Participants from time to time. |
21.9 | Delivery of notices: |
21.9.1 | Any notice to be given to Participants may be delivered to the Participant by hand, by prepaid post or email to the last address notified by the Participant to the Company or held on the Company's records. |
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21.9.2 | Any notice to be given to the Company may be delivered by hand, prepaid post, or by email to the address notified by the Company to the Participant. |
21.9.3 | Notices delivered to Participants in accordance with the Constitution will be taken to be delivered in accordance with the Constitution. Notices delivered to the Company by pre-paid post will be taken to be delivered if properly addressed and stamped, forty-eight (48) hours after mailing in Australia and seven days after mailing outside Australia. Notices delivered by facsimile, email or other mode of electronic delivery will be taken to be delivered on receipt of a successful transmission notice, return receipt or such other confirmation by which the sender can reasonably verify delivery. |
22 | Plan amendment |
Amendment of Plan
22.1 | Subject to clause 22.2 and the Constitution, the Board may at any time amend these Rules or the terms and conditions upon which any Employee Incentives have been issued under the Plan. |
22.2 | No amendment to these Rules or to Employee Incentives granted under the Plan may be made if the amendment, in the opinion of the Board, materially reduces the rights of any Participant in respect of Employee Incentives granted to them prior to the date of the amendment, other than: |
22.2.1 | an amendment introduced primarily: |
22.2.1.1 | for the purposes of complying with or conforming to present or future legislation governing or regulating the Plan or like plans; |
22.2.1.2 | to correct any manifest error or mistake; |
22.2.1.3 | to allow the implementation of a trust arrangement in relation to the holding of Shares granted under the Plan; |
22.2.1.4 | for the purpose of complying with the Applicable Laws; and/or |
22.2.1.5 | to take into consideration possible adverse taxation implications in respect of the Plan including changes to applicable taxation legislation or the interpretation of that legislation by a court of competent jurisdiction or any rulings from taxation authorities administering such legislation; or |
22.2.2 | an amendment agreed to in writing by the Participant(s). |
22.3 | The Board may determine that any amendment to these Rules or the terms of Employee Incentives granted under the Plan be given retrospective effect. |
22.4 | Amendment of these Rules or the terms and conditions upon which Employee Incentives are granted under the Plan by the Board will be of immediate effect unless otherwise determined by the Board. |
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22.5 | As soon as reasonably practicable after making any amendment to these Rules or the terms and conditions of Employee Incentives granted under the Plan, the Board will give notice of the amendment to any Participant affected by the amendment. Failure by the Board to notify a Participant of any amendment will not invalidate the amendment as it applies to that Participant. |
Amendment by Addendum
22.6 | Subject to any other provision of these Rules, the Board may from time to time amend the terms of this Plan as they will apply in particular jurisdictions or circumstances by means of an addendum to these Rules. |
23 | Termination or suspension |
Termination or Suspension
23.1 | Subject to clause 23.2, the Board may at any time terminate or amend the Plan or suspend the operation of the Plan for such period or periods as it thinks fit. |
Resolution to Terminate, Suspend, Supplement or Amend
23.2 | In passing a resolution to terminate, amend or suspend the operation of the Plan, the Board must consider and endeavour to ensure that there is fair and equitable treatment of all Participants. |
24 | No employment contract |
24.1 | Nothing in these Rules or the terms of any Employee Incentives: |
24.1.1 | confers upon an Eligible Employee a right to a grant or offer of a grant of Employee Incentives; |
24.1.2 | confers on an Eligible Employee or a Participant the right to continue as an employee or officer of the Company, or any member of the Group (as the case may be); |
24.1.3 | affects the rights of the Company, or any member of the Group, to terminate the employment or office of an Eligible Employee or a Participant (as the case may be); |
24.1.4 | affects the rights and obligations of any Eligible Employee or Participant under the terms of their office or employment with the Company, or any member of the Group; |
24.1.5 | confers any legal or equitable right on an Eligible Employee or a Participant whatsoever to take action against the Company, or any member of the Group, in respect of their office or employment; or |
24.1.6 | confers on an Eligible Employee or a Participant any rights to compensation or damages in consequence of the termination of their employment or office by the Company, or any member of the Group, for any reason whatsoever including ceasing to have rights under the Plan as a result of such termination. |
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25 | ASIC relief |
25.1 | Notwithstanding any other provisions of the Plan, every covenant or other provisions set out in an exemption or modification granted from time to time by ASIC in respect of the Plan or which applies to the Plan pursuant to its power to exempt and modify the Corporations Act and required to be included in the Plan in order for that exemption or modification to have full effect, is deemed to be contained in the Plan. To the extent that any covenant or other provision deemed by this clause 25 to be contained in the Plan is inconsistent with any other provision in the Plan, the deemed covenant or other provision will prevail. |
26 | Non-exclusivity |
Non-Exclusivity
26.1 | This Plan will not be deemed to be the exclusive method of providing incentive compensation to Eligible Employees, nor will it preclude the Company, or any member of the Group, from authorising or approving other forms of incentive compensation for employees of the Company, or any member of the Group. |
Relationship to Other Equity Plans
26.2 | Participation in this Plan will not affect or be affected by any participation in any other employee equity plan operated by the Company, except as specifically provided in the terms of that other plan. |
27 | General |
No Fiduciary Capacity
27.1 | The Board may exercise any power or discretion conferred on it by these Rules in the interest or for the benefit of the Company, and in so doing the Board is not required to act in the interests of another person or as requested by another person and will not be under any fiduciary obligation to another person. |
Listing Rules
27.2 | On the Company being admitted to the list of companies quoted on a recognised stock exchange, the provisions of the Listing Rules will apply to the Plan, and to the extent that the Plan and the Listing Rules are inconsistent, the provisions of the Listing Rules will apply. |
Enforcement
27.3 | These Rules, any determination of the Board made pursuant to the Rules, and the terms of any Shares, Options or Performance Rights granted under the Plan, will be deemed to form a contract between the Company and the Participant. |
Governing Law
27.4 | This Plan and any Shares, Options or Performance Rights granted under it will be governed by, and must be construed according to, the laws of the Western Australia and the Commonwealth of Australia. |
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28 | PROVISIONS SPECIFIC TO UNITED STATES |
Applicable Laws and Persons
28.1 | This Plan is provided by the Company and not by any of its indirect US subsidiaries (including any corporation that is a subsidiary corporation for purposes of Section 424(f) of the Code). |
28.2 | Any Performance Rights, Options, and Shares granted to an Eligible Employee residing in the U.S. are subject to the applicable provisions of the Code and this clause 28. |
General Provisions
28.3 | If the provisions for vesting of Performance Rights or Options, as applicable, are satisfied, the issue of the Shares must not occur later than March 15 of the year following the year in which the Performance Right or Option vests. Such Shares shall be issued subject to any conditions imposed by ASX. |
28.4 | Until the Shares for Performance Rights or Options, as applicable, are issued to the Participant, the Participant shall have no rights as a Shareholder. |
28.5 | In connection with the issuance of Shares and upon the exercise of any Performance Right or Option hereunder, the Participant agrees to execute any and all documents required to be executed by Applicable Law, the Company, and/or the Company’s Constitution. |
28.6 | No Performance Right or Option shall be transferable by the Participant other than by will or by the laws of descent and distribution. Performance Rights and Options issued hereunder may be exercised during the lifetime of the Participant by the Participant only. For the purposes of clarification and the avoidance, of doubt, notwithstanding anything to the contrary in clause 11 of this Plan or otherwise, the Participant is not permitted and shall not attempt to nominate a Related Party to accept any Offer of Performance Rights or Options to such Participant. The transfer of Performance Rights and Options is further limited as set forth in this Plan and any Notice of Exercise. |
28.7 | The terms of the Performance Rights, Options, and Shares shall be final, conclusive and binding upon the beneficiaries, executors, administrators, heirs and successors of the Participant. |
Certain Provisions Relating to the Grant of Incentive Stock Options and Non-Qualified Stock Options
28.8 | The Company may grant to the Participant Incentive Stock Options (ISOs) or Non-Qualified Stock Options (NQSOs). If the Options are designated as ISOs in an Offer to the Participant, to the extent the aggregate fair market value (determined as of the time of grant) of Shares with respect to which such ISOs are exercisable for the first time by the Participant during any calendar year under the Plan and/or any other stock option plan of the Company or any of subsidiary or parent thereof exceeds $100,000, such ISOs shall be treated as NQSOs. |
28.9 | Moreover, if for any reason an Option (or portion thereof) shall not qualify as an ISO, then, to the extent of such non-qualification, such Option (or portion thereof) shall be regarded as an NQSO granted under the Plan. In no event shall the Plan Administrator, the Company, any parent, subsidiary, affiliate, or any of their respective employees, directors, members, managers, shareholders, agents, consultants, independent contractors, or other service providers have any liability to the Participant (or any other person) due to the failure of the Options to qualify for any reason as ISOs. |
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28.10 | Subject to clause 28.11 below, the Options may be exercised in whole or in part once vested at any time for a period of ten (10) years from the Grant Date, unless otherwise explicitly stated in the Offer; provided, however, that in the case of an ISO granted to a Ten Percent Shareholder, the Term of such ISO shall not exceed (5) years from the Grant Date. The Grant Date, the dates at which the Options vest, and the dates at which they are exercisable shall be set out in the Offer. |
28.11 | The Options shall terminate as set forth in the Plan. |
Taxes
28.12 | At the sole discretion of the Board, upon the vesting of a Performance Right or Option, the Participant shall make arrangements to pay an amount equal to the applicable withholding taxes imposed under the Code and applicable state and local laws of the U.S. by either making payment to the Company prior to the issuance of the Shares as an express condition thereto or through payroll withholding after the issuance of the Shares. Notwithstanding the foregoing, the Company and/or its affiliates, parent, or subsidiaries may make such alternative provisions and take such alternative steps as it/they may deem necessary or appropriate for the withholding of all taxes required by applicable U.S. federal, state, or local law to be withheld by (i) deducting the amount so required to be withheld from any other amount then or thereafter payable to the Participant and/or (ii) by causing the exercise and sale of any Performance Right, Options or Shares held on behalf of the Participant to cover such liability up to the amount required to satisfy minimum statutory withholding requirements. In addition, the Participant will be pay any amount, including penalties, that exceeds the tax to be withheld and transferred to the tax authorities, pursuant to applicable tax laws and regulations. |
28.13 | The Company’s rights in clause 28.12 shall not relieve the Participant of the Participant’s obligation to make satisfactory arrangements for satisfaction of withholding obligations as they become due. The ultimate responsibility and liability for any and all taxes belongs to and shall remain with the Participant, and any tax consequences arising from the grant or exercise of any Performance Right or Option, from the payment of Shares covered thereby, or from any other event or act relating to the Performance Rights, Options, or Shares issued upon exercise thereof, shall be borne solely by the Participant. The Company makes no representations or undertaking regarding the tax treatment of any grant, issuance or exercise of any Performance Rights, Options, or Shares. |
28.14 | The Participant agrees to indemnify the Company and/or its affiliates, parent, subsidiaries, and any Related Body Corporate and hold them harmless against and from all liability for any taxes due under this clause 28 or interest or penalty thereon, including without limitation, liabilities relating to the necessity to withhold, or to have withheld, any such tax from any payment made to the Participant for which the Participant is responsible. |
28.15 | It is the intent of the Company that the Performance Rights issued hereunder be exempt from Code Section 409A as short term deferrals and that the Participant’s right to the Performance Rights be subject to the short-term deferral exception. The Company reserves the right to amend the Plan from time to time and at any time to ensure compliance with Code Section 409A. No payment hereunder shall be accelerated, delayed or substituted with another payment nor have vesting accelerated to the extent such change in the rights granted hereunder cause the Performance Rights to fail to be exempt from Code Section 409A. Further, any distribution subject to Code Section 409A to a “specified employee” may be delayed as required by Code Section 409A. |
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Notice of Disqualifying Disposition of ISO Shares
28.16 | If an Option granted to the Participant hereunder is an ISO, and if Participant sells or otherwise disposes of any of the Shares acquired pursuant to the ISO on or before the latter of (i) the date two (2) years after the Grant Date or (ii) the date one (1) year after the date of exercise, Participant shall immediately notify the Company in writing of such disposition. Participant agrees that Participant may be subject to income tax withholding by the Company on the compensation income recognized by the Participant. |
U.S. Securities Laws
28.17 | The grant of the Performance Rights and Options and any issuance of Shares following vesting shall be in accordance with registration requirements of U.S. federal and state securities law, or shal1be in accordance with an exemption from those registration requirements. Shares shall not be issued pursuant to the exercise of a Performance Right or an Option unless the exercise of such Option and the issuance and delivery of such shares complies with U.S. federal and state securities laws and any other Applicable Law and shall be further subject to the approval of counsel for the Company with respect to such compliance. The inability of the Company to obtain authority from any regulatory body having jurisdiction, which authority is deemed by Company’s counsel to be necessary to the lawful issuance and sale of any Shares hereunder, shall relieve the Company of any liability with respect of the failure to issue or sell such Shares as to which requisite authority shall not have been obtained. |
28.18 | Transferability of such Performance Rights and Options and of the Shares is subject to restrictions imposed by the applicable Performance Right or Option terms, applicable U.S. federal and state (and other) securities law, and one or more restrictive legends will be placed on the share certificates. Such restrictive legends shall indicate that the Shares were granted pursuant to this Plan and that transfer of such Shares is subject to the limitations of this Plan and the terms and provisions hereof governing Performance Rights or Options, as applicable. Participant hereby agrees to strictly adhere to the Company’s written guidelines for converting his or her Shares to American depository receipts prior to attempting to transfer, resell, trade, or otherwise dispose of such Shares via a U.S.-based stock exchange. |
Data Privacy
28.19 | Participant hereby explicitly and unambiguously consents to the collection, use and transfer, in electronic or other form, of the Participant’s personal data as described in this Agreement and any other Performance Right or Option grant materials by and among, as applicable, the Company and its parent, subsidiaries and affiliates for the purpose of implementing, administering and managing the Participant’s participation in the Plan. Participant understands that the Company may hold certain personal information about the Participant, including, but not limited to, Participant’s name, home address and telephone number, date of birth, social security (insurance) number or other identification number, salary, nationality, job title, any shares of stock or directorships held in the Company, details of all options or any other entitlement to shares of stock awarded, canceled, exercised, vested, unvested or outstanding in the Participant’s favor, for the purpose of implementing, administering and managing the Plan (the “Data”). Participant understands that Data may be transferred to any third parties assisting the Company with the implementation, administration and management of the Plan. Participant understands that the recipients of the Data may be located in Australia, the U.S. or elsewhere, and that the recipient’s country may have different data privacy laws and protections than Participant’s country. Participant hereby authorizes the recipients to receive, possess, use, retain and transfer the Data, in electronic or other form, for the purpose of implementing, administering and managing Participant’s participation in the Plan, including any transfer of such Data as may be necessary or appropriate to a broker, escrow agent or other third party with whom the Shares acquired upon exercise of the Performance Rights or Options may be deposited. |
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29 | Definitions and interpretation |
Definitions
29.1 | In these Rules, unless the context otherwise requires, the following terms and expressions will have the following meanings: |
Applicable Law means any one or more or all, as the context requires of:
(a) | the Corporations Act; |
(b) | the Listing Rules (as applicable) or the rules of a foreign stock exchange which the Company is listed; |
(c) | the Constitution; |
(d) | the Income Tax Assessment Act 1936 (Cth) and the Income Tax Assessment Act 1997 (Cth), each as amended from time to time; |
(e) | the Code and any regulations thereunder (as applicable); |
(f) | U.S. federal or state securities laws and other laws (as applicable); |
(g) | any practice note, policy statement, regulatory guide, class order, declaration, guideline, policy, procedure, ruling, judicial interpretation or other guidance note made to clarify, expand or amend paragraphs (a), (b), and (d) above; and |
(h) | any other legal requirement that applies to the Plan. |
Application means an application by an Eligible Employee to participate in the Plan made in response to an Offer substantially in the form set out in Schedules 3 or 4 (as applicable) or any other form as determined by the Board.
ASIC means the Australian Securities and Investments Commission.
ASX means ASX Limited (ABN 98 008 624 691) or, the context permits, the Australian Securities Exchange operated by ASX Limited.
Bad Leaver means, unless otherwise determined by the Board in its sole and absolute discretion, a Participant who ceases employment or office with the Company or a Group Member, including (but not limited to) for any of the circumstances described in clause 14.1.
Board means the board of directors of the Company, a committee appointed by the board of directors of the Company as constituted from time to time, or any person who is provided with delegated authority by the board from time to time.
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Buy-Back means the buy-back by the Company of Employee Incentives, pursuant to clause 15, and Bought-Back has a similar meaning.
Buy-Back Period means, with respect to any Employee Incentive and any Participant, the period of 90 days from the date that the right to Buy-Back arises under clause 15.1 of the Plan.
Buy-Back Price means the price at which the Employee Incentives are to be Bought-Back as determined under clause 16.1.
Code means the U.S. Internal Revenue Code of 1986, as amended.
Company means IperionX Limited (ACN 618 935 372).
Control has the meaning given in Section 50AA of the Corporations Act and Controlled has a corresponding meaning.
Constitution means the constitution of the Company, as amended from time to time.
Corporations Act means the Corporations Act 2001 (Cth), as amended from time to time.
Data has the meaning given to that term in clause 28.19.
Director means a director of the Company, or any member of the Group.
Eligible Employee means:
(a) | Directors (excluding non-executive Directors) and Employees who are declared by the Board in its sole and absolute discretion to be eligible to receive grants of Employee Incentives under the Plan; or |
(b) | any other person who is declared by the Board in its sole and absolute discretion to be eligible to receive grants of Employee Incentives, |
under the Plan.
Employee means an employee or other consultant or contractor of the Company, or any member of the Group.
Employee Incentive means any:
(a) | Option or Performance Right granted; or |
(b) | Share(s) issued pursuant to the exercise of an Option or conversion of a Performance Rights, |
under this Plan.
Exercise Period means the period up to the Expiry Date during which a vested Option may be exercised, and as determined by the Board.
Exercise Price means the exercise price payable (if any) by a Participant to acquire a Share upon the exercise of an Option as specified by the Board in the Offer in its sole and absolute discretion.
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Expiry Date means the date determined by the Board and as specified in the Offer with respect to those Options or Performance Rights, after which those Options or Performance Rights lapse and, in the case of Options, may no longer be exercised.
Fee means any fee payable by a Participant on the grant of Employee Incentives, and as determined by the Board in its sole and absolute discretion.
Former Participant means a Participant who ceases to be an Employee.
Good Leaver means a Participant who ceases employment or office with the Company or a Group Member and is determined by the Board to be a Good Leaver.
Grant Date means the date on which Employee Incentives are granted to a Participant following the acceptance of an Application.
Group means the Company and its Related Bodies Corporate.
Incentive Stock Option or ISO shall mean an Option issued hereunder to an Eligible Employee that is intended to be an “incentive stock option” within the meaning of Code Section 422.
Liquidity Event means:
(a) | a sale of all of the ordinary shares in the Company; or |
(b) | a sale of all or substantially all of the assets of the Company. |
Listing Rules means the listing rules, market rules or operating rules of a financial market in respect of which the Company's shares are quoted or are the subject of an application for quotation, including but not limited to, the official listing rules of the ASX (as relevant).
Non-Qualified Stock Option or NQSO means an Option not described in Code Sections 422(b) or 423(b), or which, by its terms, does not qualify or is not intended to qualify as an Incentive Stock Option.
Nominated Beneficiary means:
(a) | if a Participant has included a nominated beneficiary in their Offer Letter, the person nominated by the Participant in their Offer Letter; or |
(b) | if a Participant has not included a nominated beneficiary in their Offer Letter, then the Participant's beneficiary, personal representative or successor in title. |
Notice of Exercise means a notice of exercise of Options in the form determined by the Board from time to time.
Offer means an offer to an Eligible Employee to apply for the grant of Employee Incentives under the Plan, in each case substantially in the form set out in Schedules 3 or 4 (as applicable) to this Plan.
Offer Conditions has the meaning given to that term in clause 4.4.2.
Offer Letter means a letter containing an Offer to an Eligible Employee that sets out the terms and conditions of the Offer, substantially in the form set out in Schedules 3 or 4 (as applicable).
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Option means an option granted under this Plan to subscribe for, acquire and/or be allocated (as determined by the Board in its sole and absolute discretion) one Share subject to the Rules and terms and conditions in Schedule 1.
Participant means an Eligible Employee who has been offered Employee Incentives and who has returned a corresponding Application to the Company that has been accepted by the Company pursuant to these Rules, or, as applicable, that Eligible Employee's Related Party nominated in accordance with clause 11.
Performance Criteria means any performance requirements (as specified in the Offer Letter and determined by the Board in its sole and absolute discretion) which must be met prior to the vesting of an Employee Incentive.
Performance Period means the period in which the Performance Criteria must be satisfied in respect of an Employee Incentive.
Performance Right means a right granted under this Plan to be issued one Share subject to the Rules and the terms and conditions in Schedule 2.
Plan means the employee incentive plan as administered in accordance with these Rules.
Plan Administrator means a person or entity appointed to administer the Plan.
Related Body Corporate has the meaning given in section 9 of the Corporations Act.
Related Party in relation to an Eligible Employee means:
(a) | a trustee of a trust, in respect of which the Eligible Employee is the trustee or the Eligible Employee Controls a body corporate which is the trustee; or |
(b) | a body corporate Controlled by such Eligible Employee; or |
(c) | any other person deemed a related party by the Board. |
Relevant Interest has the meaning given to that term under section 9 of the Corporations Act.
Rules means these rules in respect of the operation of the Plan, as amended from time to time.
SEC means the U.S. Securities and Exchange Commission.
Securities Act means the U.S. Securities Act of 1933, as amended.
Security Interest means a mortgage, charge, pledge, lien, encumbrance or other third party interest of any nature.
Share means a fully paid ordinary share in the capital of the Company, including those issued pursuant to Performance Rights or Options hereunder.
Share Trading Policy means any Company share trading policy as amended from time to time.
Shareholder means any holder of a Share.
Special Circumstances means any of the following:
(a) | the death of the Participant; or |
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(b) | the total and permanent disablement of the Participant such that the Participant is unlikely ever to engage in any occupation for which the Participant is reasonably qualified by education, training or experience. |
Takeover Bid has the meaning given to that term under section 9 of the Corporations Act.
Ten Percent Shareholder means any Participant who owns more than ten percent (10%) of the combined voting power of all classes of stock of the Company, within the meaning of Code Section 422.
Term means the period commencing on the Grant Date and ending on the Expiry Date (inclusive).
Transfer has the meaning given to that term in the Constitution.
Vesting Conditions means any time based requirement or condition (as specified in the Offer and determined by the Board in its sole and absolute discretion) which must be met prior to Employee Incentives (as applicable) vesting in a Participant.
Vesting Notification means a notice to a Participant informing the Participant that the Participant's Employee Incentives have vested and are exercisable (if applicable).
Interpretation
29.2 | In these Rules, unless otherwise stated or the contrary intention appears: |
29.2.1 | the singular includes the plural and vice versa; |
29.2.2 | a gender includes all genders; |
29.2.3 | a reference to any legislation includes any modification or replacement of it and all regulations and statutory instruments issued under it and a reference to any provision of any legislation includes any modification or substitution of it; |
29.2.4 | a reference to these Rules means these Rules as amended from time to time and includes all recitals, annexures, addendums and schedules to these Rules; |
29.2.5 | a reference to a person includes a reference to the person's executors, administrators and successors or a body corporate including any person taking by way of novation and, in the case of a trustee, includes any substituted or additional trustee; and |
29.2.6 | in these Rules any reference to include means to include without limitation. |
29.3 | In the event of any inconsistency between the terms of an Offer, Options, Performance Rights or the Rules, the terms of the relevant Employee Incentive will be interpreted in the following priority: |
29.3.1 | the terms of the Offer; |
29.3.2 | the terms of the Options in Schedule 1 or the terms of the Performance Rights in Schedule 2 (as applicable); and |
29.3.3 | the Rules. |
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Applicable Laws
29.4 | These Rules, the offering and granting of any Options, the issuing and/or transferring of any Shares, including Shares, and the rights attaching to or interests in the Options and Shares, including Shares, will at all times be subject to all Applicable Laws. |
Share Trading Policy
29.5 | A Participant must comply with any Share Trading Policy at all times. |
Rounding
29.6 | Where any calculation or adjustment to be made pursuant to these Rules produces a fraction of a cent or a fraction of an Option or a Share, the fraction will be eliminated by rounding to the nearest whole number. |
Headings
29.7 | Headings are inserted in these Rules for convenience only and do not affect the interpretation of these Rules. |
Constitution
29.8 | The entitlements of Eligible Employees and Participants under these Rules are subject to the Constitution. |
29.9 | In the event of any inconsistency between these Rules and either of the Constitution, the terms of the Constitution will prevail to the extent of that inconsistency. |
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SCHEDULE 1: terms and conditions of options
Entitlement
1.1 | Subject to the Board determining otherwise prior to an Offer, each vested Option entitles the Participant holding the Option to subscribe for, or to be transferred, one Share on payment of the Exercise Price (if any). |
Exercise Period
1.2 | The Exercise Period and Expiry Date for Options will be as determined by the Board in its sole and absolute discretion. |
1.3 | If the Participant is prohibited from exercising vested Options under Applicable Law on or in the ten (10) business days before the Expiry Date, the Expiry Date for the Options is automatically extended to the date that is five (5) business days after the Participant is no longer prohibited under Applicable Law from exercising the Option. |
Conditions for Vesting and Exercise
1.4 | The Board will determine prior to an Offer being made and specify in the Offer any Performance Criteria and/or Vesting Conditions attaching to the Options. |
1.5 | Options will only vest and be exercisable if the applicable Performance Criteria and/or Vesting Conditions (if any) have been satisfied, waived by the Board, or are deemed to have been satisfied under these Rules. |
1.6 | In the event of a Liquidity Event, the Board in its absolute discretion may waive any vesting or exercise criteria in respect of some or all Options held by a Participant. |
Method of Exercise
1.7 | Following the issuing of a Vesting Notification to the Participant, the Option is exercisable by the Participant within the Exercise Period specified by the Board in the Offer, subject to the Participant delivering to the registered office of the Company or such other address as determined by the Board of: |
1.7.1 | a signed Notice of Exercise; and |
1.7.2 | subject to the cashless exercise option, a cheque or cash or such other form of payment determined by the Board in its sole and absolute discretion as satisfactory for the amount of the Exercise Price (if any). |
No Issue Unless Cleared Funds
1.8 | Where a cheque is presented as payment of the Exercise Price on the exercise of Options, the Company will not, unless otherwise determined by the Board, allot and issue or transfer Shares until after any cheque delivered in payment of the Exercise Price has been cleared by the banking system. |
Cashless Exercise of Options
1.9 | Subject to clause 1.10, a Participant may elect to pay the Exercise Price for each Option by setting off the total Exercise Price against the number of Shares which they are entitled to receive upon exercise (Cashless Exercise Facility). By using the Cashless Exercise Facility, the holder will receive Shares to the value of the surplus after the Exercise Price has been set off. |
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1.10 | If the Participant elects to use the Cashless Exercise Facility, the Participant will only be issued that number of Shares (rounded down to the nearest whole number) as is equal in value to the difference between the total Exercise Price otherwise payable for the Options on the Options being exercised and the then market value of the Shares at the time of exercise calculated in accordance with the following formula: |
S = O x (MSP - EP)
MSP
Where:
S = Number of Shares to be issued on exercise of the Options
O = Number the Options being exercised
MSP = Market value of the Shares calculated using the volume weighted average of the Shares on ASX for the 5 trading days immediately prior to (and excluding) the date of the Notice of Exercise
EP = Exercise Price
1.11 | If the difference between the total Exercise Price otherwise payable for the Options on the Options being exercised and the then market value of the Shares at the time of exercise (calculated in accordance with clause 1.10) is zero or negative, then a Participant will not be entitled to use the Cashless Exercise Facility. |
Minimum Exercise
1.12 | Options must be exercised in multiples of one hundred (100) unless fewer than one hundred (100) Options are held by a Participant or the Board otherwise agrees. |
Actions on Exercise
1.13 | Following the exercise of Options: |
1.13.1 | the Options will automatically lapse; and |
1.13.2 | the Company will allot and issue, or transfer, the number of Shares for which the Participant is entitled to subscribe for or acquire through the exercise of the Options. |
Timing of the Issue of Shares on Exercise and Quotation
1.14 | The Company must within twenty (20) business days after the later of the following: |
1.14.1 | receipt of a Notice of Exercise given in accordance with these terms and conditions and payment of the Exercise Price for each Option being exercised; and |
1.14.2 | when excluded information in respect of the Company (as defined in section 708A(7) of the Corporations Act) (if any) ceases to be excluded information. If there is no such information, the relevant date will be the date of receipt of a Notice of Exercise as detailed in clause 1.14.1 above, |
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the Company will:
1.14.3 | allot and issue the Shares pursuant to the exercise of the Options; |
1.14.4 | as soon as reasonably practicable and if required, give ASX a notice that complies with section 708A(5)(e) of the Corporations Act, or, if the Company is unable to issue such a notice, lodge with ASIC a prospectus prepared in accordance with the Corporations Act and do all such things necessary to satisfy section 708A(11) of the Corporations Act to ensure that an offer for sale of the Shares does not require disclosure to investors; and |
1.14.5 | apply for official quotation on ASX of Shares issued pursuant to the exercise of the Options. |
1.15 | Notwithstanding clause 1.14 above, solely with respect to Participants who are not U.S. residents or to the extent such does not otherwise violate Code Section 409A, the Company’s obligation to issue such Shares shall be postponed if such Participant at any time after the delivery of a Notice of Exercise and payment of the Exercise Price for each Option being exercised (if applicable) elects for the Shares to be issued to be subject to a holding lock for a period of twelve (12) months. Following any such election: |
1.15.1 | the Shares to be issued or transferred will be held by such Participant on the Company's issuer sponsored sub-register (and not in a CHESS sponsored holding); |
1.15.2 | the Company will apply a holding lock on the Shares to be issued or transferred and such Participant is taken to have agreed to that application of that holding lock; |
1.16 | the Company shall release the holding lock on the Shares on the earlier to occur of: |
1.16.1 | the date that is twelve (12) months from the date of issue of the Share; or |
1.16.2 | the date the Company issues a disclosure document that qualifies the Shares for trading in accordance with section 708A(11) of the Corporations Act; or |
1.16.3 | the date a transfer of the Shares occurs pursuant to clause 1.17 of these terms and conditions; and |
1.17 | Shares shall be transferable by such Participant and the holding lock will be lifted provided that the transfer of the Share complies with section 707(3) of the Corporations Act and, if requested by the Company, the transferee of the Shares agrees by way of a deed poll in favour of the Company to the holding lock applying to the Shares following its transfer for the balance of the period in clause 1.16.1. |
Shares Issued on Exercise
1.18 | Shares issued on the exercise of the Options rank equally with all existing Shares, including those Shares issued, directly, under the Plan. |
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Quotation of the Shares Issued on Exercise
1.19 | If admitted to the official list of ASX at the time, application will be made by the Company to ASX for quotation of the Shares issued upon the exercise of the Options. |
Adjustment for Reorganisation
1.20 | Subject to any Applicable Laws, the number of Options held by a Participant under the Plan may, in the sole and absolute discretion of the Board, be determined to be such number as is appropriate and so that the Participant does not suffer any material detriment following any variation in the share capital of the Company arising from: |
1.20.1 | a reduction, subdivision or consolidation of share capital; |
1.20.2 | a reorganisation of share capital; |
1.20.3 | a distribution of assets in specie; |
1.20.4 | the payment of a dividend, otherwise than in the ordinary course, of an amount substantially in excess of the Company's normal distribution policy; or |
1.20.5 | any issue of ordinary shares or other equity securities or instruments which convert into ordinary shares by way of capitalisation of profits or reserves. |
1.21 | Upon any adjustment being made, the Board will notify each Participant (or his or her legal personal representative where applicable) in writing, informing them of the number of Options held by the relevant Participant. |
1.22 | If there is any reorganisation of the issued share capital of the Company, the terms of Options and the rights of the Participant who holds such Options will be varied, including an adjustment to the number of Options and/or the Exercise Price (if any) applicable to Options, in accordance with the Listing Rules that apply to the reorganisation at the time of the reorganisation. |
Participant in New Issues and Other Rights
1.23 | A Participant who holds Options is not entitled to: |
1.23.1 | notice of, or to vote or attend at, a meeting of the Shareholders; |
1.23.2 | receive any dividends declared by the Company; or |
1.23.3 | participate in any new issues of securities offered to Shareholders during the term of the Options, |
unless and until the Options are exercised and the Participant holds Shares.
Adjustment for Rights Issue
1.24 | If the Company makes an issue of Shares pro rata to existing Shareholders (other than an issue in lieu of in satisfaction of dividends or by way of dividend reinvestment) the Exercise Price of an Option will be reduced according to the following formula: |
New exercise price = O - (E[P-(S+D)] divided by N+1)
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O = | the old Exercise Price of the Option. |
E = | the number of underlying Shares into which one Option is exercisable. |
P = | average market price per Share weighted by reference to volume of the underlying Shares during the five (5) trading days ending on the day before the ex rights date or ex entitlements date. |
S = | the subscription price of a Share under the pro rata issue. |
D = | the dividend due but not yet paid on the existing underlying Shares (except those to be issued under the pro rata issue). |
N = | the number of Shares with rights or entitlements that must be held to receive a right to one new share. |
Adjustment for Bonus Issue of Shares
1.25 | If the Company makes a bonus issue of Shares or other securities to existing Shareholders (other than an issue in lieu or in satisfaction, of dividends or by way of dividend reinvestment): |
1.25.1 | the number of Shares which must be issued on the exercise of an Option will be increased by the number of Shares which the Participant would have received if the Participant had exercised the Option before the record date for the bonus issue; and |
1.25.2 | no change will be made to the Exercise Price. |
Change of Control
1.26 | For the purposes of these terms and conditions, a "Change of Control Event" occurs if: |
1.26.1 | the Company announces that its Shareholders have at a Court convened meeting of Shareholders voted in favour, by the necessary majority, of a proposed scheme of arrangement (excluding a merger by way of scheme of arrangement for the purposes of a corporate restructure (including change of domicile, or any reconstruction, consolidation, sub-division, reduction or return) of the issued capital of the Company) and the Court, by order, approves the scheme of arrangement; |
1.26.2 | a Takeover Bid: |
1.26.2.1 | is announced; |
1.26.2.2 | has become unconditional; and |
1.26.2.3 | the person making the Takeover Bid has a Relevant Interest in fifty percent (50%) or more of the issued Shares; |
1.26.3 | any person acquires a Relevant Interest in fifty and one-tenth percent (50.1%) or more of the issued Shares by any other means; or |
1.26.4 | the announcement by the Company that a sale or transfer (in one transaction or a series of related transactions) of the whole or substantially the whole of the undertaking and business of the Company has been completed. |
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1.27 | Where a Change of Control Event has (i) occurred or (ii) been announced by the Company and, in the opinion of the Board, will or is likely to occur: |
1.27.1 | a Participant may exercise any or all of their Options, regardless of whether the Vesting Conditions have been satisfied, provided that no Option will be capable of exercise later than the Expiry Date; and |
1.27.2 | if the Board has procured an offer for all holders of Options on like terms (having regard to the nature and value of the Options) to the terms proposed under the Change in Control Event and the Board has specified (in its absolute discretion) a period during which the holders of Options may elect to accept the offer and, if the holder has not so elected at the end of that offer period, the Options, if not exercised within 10 days of the end of that offer period, shall expire. |
Quotation
1.28 | The Company will not seek official quotation of any Options. |
No Transfer of Options
1.29 | Options granted under this Plan may not be assigned, transferred, encumbered with a Security Interest in or over them, or otherwise disposed of by a Participant, unless: |
1.29.1 | the prior consent of the Board is obtained, which consent may impose such terms and conditions on such assignment, transfer, encumbrance with a Security Interest or disposal as the Board sees fit; or |
1.29.2 | such assignment or transfer occurs by force of law upon the death or total and permanent disablement of a Participant to the Participant's legal personal representative. |
Options to be Recorded
1.30 | Options will be recorded in the appropriate register of the Company. |
Rules
1.31 | The Options are issued under and in accordance with the Plan and the terms and conditions of these Options are subject to the Rules. |
Options Granted to Eligible Employees Residing in the U.S.
1.32 | With respect to Options granted to Eligible Employees residing in the U.S, clause 28 of the Plan shall apply, notwithstanding anything to the contrary herein or in clause 28.3 of the Plan, to the extent that there is any inconsistency between this Schedule 1 and the terms, conditions, and provisions hereof and clause 28, the latter will prevail. |
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SCHEDULE 2: terms and conditions of performance rights
Offer of Performance Rights
1.1 | The Board may offer Performance Rights to any Participant in its sole discretion. Each Performance Right confers an entitlement to be provided with one Share, credited as fully paid, at no cost, upon the full satisfaction of the Performance Criteria and/or Vesting Conditions specified by the Board in relation to that Performance Right. |
Performance Criteria/Vesting Conditions and Variation to Performance Criteria//Vesting Conditions
1.2 | The Board will determine prior to an Offer being made and specify in the Offer any Performance Criteria, Vesting Conditions, Performance Period or Expiry Date attaching to the Performance Rights. |
1.3 | Performance Rights will only vest and entitle the Participant to be issued Shares if the applicable Performance Criteria and/or Vesting Conditions (if any) have been satisfied prior to the end of the Performance Period, waived by the Board, or are deemed to have been satisfied under these Rules. |
Satisfaction of Performance Criteria
1.4 | The Board will determine in its sole discretion whether (and, where applicable, to what extent) the Participant has satisfied the Performance Criteria and/or Vesting Conditions (if any) applicable to the Performance Rights at the end of the Performance Period. As soon as practicable after making that determination the Board must allot and issue, or transfer, the number of Shares for which the Participant is entitled to acquire upon satisfaction of the Performance Criteria and/or Vesting Conditions for the relevant number of Performance Rights held in accordance with clause 1.6. |
Lapse of Performance Rights
1.5 | Where Performance Rights have not satisfied the Performance Criteria within the Performance Period or Expiry Date (whichever occurs earlier) those Performance Rights will automatically lapse. |
Timing of the Issue of Shares and Quotation
1.6 | The Company must within twenty (20) business days after the later of the following: |
1.6.1 | the satisfaction of the Performance Criteria and/or Vesting Conditions (if any) applicable to the Performance Rights; and |
1.6.2 | when excluded information in respect of the Company (as defined in section 708A(7) of the Corporations Act) (if any) ceases to be excluded information. If there is no such information, the relevant date will be the date the relevant Performance Criteria and/or Vesting Conditions are satisfied pursuant to clause 1.4, |
the Company will:
1.6.3 | allot and issue the Shares pursuant to the vesting of the Performance Rights; |
32 |
1.6.4 | as soon as reasonably practicable and if required, give ASX a notice that complies with section 708A(5)(e) of the Corporations Act, or, if the Company is unable to issue such a notice, lodge with ASIC a prospectus prepared in accordance with the Corporations Act and do all such things necessary to satisfy section 708A(11) of the Corporations Act to ensure that an offer for sale of the Shares does not require disclosure to investors; and |
1.6.5 | apply for official quotation on ASX of Shares issued pursuant to the vesting of the Performance Rights. |
1.7 | Notwithstanding clause 1.6 above, solely with respect to Participants who are not U.S. residents or to the extent such does not otherwise violate Code Section 409A, the Company’s obligation to issue such Shares shall be postponed if such Participant at any time after the relevant Performance Criteria and/or Vesting Conditions are satisfied pursuant to clause 1.4 elects for the Shares to be issued to be subject to a holding lock for a period of twelve (12) months. Following any such election: |
1.7.1 | the Shares to be issued or transferred will be held by such Participant on the Company's issuer sponsored sub-register (and not in a CHESS sponsored holding); |
1.7.2 | the Company will apply a holding lock on the Shares to be issued or transferred and such Participant is taken to have agreed to that application of that holding lock; |
1.7.3 | the Company shall release the holding lock on the Shares on the earlier to occur of: |
1.7.3.1 | the date that is twelve (12) months from the date of issue of the Share; or |
1.7.3.2 | the date the Company issues a disclosure document that qualifies the Shares for trading in accordance with section 708A(11) of the Corporations Act; or |
1.7.3.3 | the date a transfer of the Shares occurs pursuant to clause 1.7.4 of these terms and conditions; and |
1.7.4 | Shares shall be transferable by such Participant and the holding lock will be lifted provided that the transfer of the Share complies with section 707(3) of the Corporations Act and, if requested by the Company, the transferee of the Shares agrees by way of a deed poll in favour of the Company to the holding lock applying to the Shares following its transfer for the balance of the period in clause 1.7.3.1. |
Shares Issued
1.8 | Shares issued on the satisfaction of the Performance Criteria and/or Vesting Conditions attaching to the Performance Rights rank equally with all existing Shares, including those Shares issued, directly, under the Plan. |
Quotation of the Shares Issued on Exercise
1.9 | If admitted to the official list of ASX at the time, application will be made by the Company to ASX for quotation of the Shares issued upon the vesting of the Performance Rights. |
33 |
Reorganisation
1.10 | If there is any reorganisation of the issued share capital of the Company, the terms of Performance Rights and the rights of the Participant who holds such Performance Rights will be varied, including an adjustment to the number of Performance Rights, in accordance with the Listing Rules that apply to the reorganisation at the time of the reorganisation. |
Participant Rights
1.11 | A Participant who holds Performance Rights is not entitled to: |
1.11.1 | notice of, or to vote or attend at, a meeting of the Shareholders; or |
1.11.2 | receive any dividends declared by the Company, |
1.11.3 | participate in any new issues of securities offered to Shareholders during the term of the Performance Rights, or |
1.11.4 | cash for the Performance Rights or any right to participate in surplus assets of profits of the Company on winding up, |
unless and until the Performance Rights are satisfied and the Participant holds Shares.
Pro Rata Issue of Securities
1.12 | If during the term of any Performance Right, the Company makes a pro rata issue of securities to the Shareholders by way of a rights issue, a Participant shall not be entitled to participate in the rights issue in respect of any Performance Rights, only in respect of Shares issued in respect of vested Performance Rights. |
1.13 | A Participant will not be entitled to any adjustment to the number of Shares they are entitled to or adjustment to any Performance Criteria and/or Vesting Conditions which is based, in whole or in part, upon the Company’s share price, as a result of the Company undertaking a rights issue. |
Adjustment for Bonus Issue
1.14 | If, during the term of any Performance Right, securities are issued pro rata to Shareholders generally by way of bonus issue, the number of Shares to which the Participant is then entitled, shall be increased by that number of securities which the Participant would have been issued if the Performance Rights then held by the Participant were vested immediately prior to the record date for the bonus issue. |
Change of Control
1.15 | For the purposes of these terms and conditions, a "Change of Control Event" occurs if: |
1.15.1 | the Company announces that its Shareholders have at a Court convened meeting of Shareholders voted in favour, by the necessary majority, of a proposed scheme of arrangement (excluding a merger by way of scheme of arrangement for the purposes of a corporate restructure (including change of domicile, or any reconstruction, consolidation, sub-division, reduction or return) of the issued capital of the Company) and the Court, by order, approves the scheme of arrangement; |
1.15.2 | a Takeover Bid: |
34 |
1.15.2.1 | is announced; |
1.15.2.2 | has become unconditional; and |
1.15.2.3 | the person making the Takeover Bid has a Relevant Interest in fifty percent (50%) or more of the issued Shares; |
1.15.3 | any person acquires a Relevant Interest in fifty and one-tenths percent (50.1%) or more of the issued Shares by any other means; or |
1.15.4 | the announcement by the Company that a sale or transfer (in one transaction or a series of related transactions) of the whole or substantially the whole of the undertaking and business of the Company has been completed. |
1.16 | Where a Change of Control Event has (i) occurred or (ii) been announced by the Company and, in the opinion of the Board, will or is likely to occur, all granted Performance Rights which have not yet vested or lapsed shall automatically and immediately vest, regardless of whether any Performance Criteria or Vesting Conditions have been satisfied. |
Quotation
1.17 | The Company will not seek official quotation of any Performance Rights. |
Performance Rights Not Property
1.18 | A Participant's Performance Rights are personal contractual rights granted to the Participant only and do not constitute any form of property. |
No Transfer of Performance Rights
1.19 | Unless otherwise determined by the Board, Performance Rights cannot be transferred to or vest in any person other than the Participant. |
Rules
1.20 | The Performance Rights are issued under and in accordance with the Plan and the terms and conditions of these Performance Rights are subject to the Rules. |
Performance Rights Granted to Eligible Employees Residing in the U.S.
1.21 | With respect to Performance Rights granted to Eligible Employees residing in the U.S, clause 28 of the Plan shall apply, notwithstanding anything to the contrary herein or in clause 28.3 of the Plan, to the extent that there is any inconsistency between this Schedule 2 and the terms, provisions, conditions hereof and clause 28, the latter will prevail. |
35 |
SCHEDULE 3: PRO-FORMA OFFER LETTER - OPTIONS
[date]
[insert Participant name]
[insert Participant address]
Dear Participant
Offer To Participate In IperionX Employee Incentive Plan
As you are aware, IperionX Limited (“IperionX”) has established an Employee Incentive Plan (“Plan”).
To incentivise people important to the development prospects of IperionX and to ensure the interests and motivations of such key persons are aligned with the interests and motivations of shareholders of IperionX, the Board of IperionX (“Board”) have elected to offer equity to some key individuals.
As a key member of the IperionX team, IperionX is delighted to offer you the opportunity to participate in the Plan on the terms set out in this letter (“Offer”) and in accordance with the rules of the Plan and the terms of and conditions of the options as enclosed (“Rules”).
The offer means such key persons will have an opportunity to be personally rewarded for developing the business of IperionX.
The Grant Date of Employee Incentives issued under the Plan is the date of this Offer Letter.
Enclosed is a copy of the Rules. Capitalised terms which are defined in the Rules have the same meaning in this Offer Letter.
KEY TERMS OF THE OFFER
IperionX is offering you the opportunity to acquire the following unlisted options to subscribe for fully paid ordinary shares in IperionX, subject to the satisfaction of certain Vesting Conditions (“Options”) for no consideration:
NUMBER OF OPTIONS OFFERED |
EXERCISE PRICE OF OPTIONS |
VESTING CONDITIONS |
EXPIRY DATE OF OPTIONS |
[insert number of options] | [insert exercise price of options] | [e.g. 12 months continuous service from the Grant Date] | [insert expiry date of options] |
[insert number of options] | [insert exercise price of options] | [e.g. 12 months continuous service from the Grant Date] | [insert expiry date of options] |
The Options will only be issued to you if you continue to be employed or engaged by IperionX or one of its subsidiaries at the Grant Date.
36 |
Conversion Rate
Upon exercise each Option will convert to one fully paid ordinary share in IperionX.
Exercise Period
Your vested Options will be exercisable at any time before the Expiry Date.
Nominee
You may nominate a Related Party to receive the Options in accordance with clause 11 of the Plan. In order to do so, you will need to include the nominee’s details in the attached application (“Application”).
Notwithstanding the foregoing, if you are an Eligible Employee residing in the U.S., you cannot nominate a Related Party to receive the Options.
Quotation
The Options will not be quoted on ASX.
Other Terms Applicable to the Offer
[insert other applicable terms, if applicable, such as Performance Criteria]
For Options Granted to Participants residing in the U.S.: PLEASE BE ADVISED that clause 28 of the Plan applies to you. Before accepting this Offer, please read the terms, provisions, and conditions of clause 28 in full (in addition to and in conjunction with the other terms, provisions, and conditions of the Plan, this Offer, and the Rules). If you have any questions regarding the same, please let me know before accepting this Offer.
The other terms and conditions applicable to the Options offered to you are described in Schedule 1 of the Plan.
Financial and Taxation Consequences
This Offer does not purport to provide all of the information you may require in order to evaluate an investment in the Company. The Company in making the Offer is not giving you any financial, legal, tax or investment advice. You should make your own enquiries and evaluations as you deem necessary of the Offer (including your investment objectives, financial situation, and particular needs), and you should seek all necessary financial, legal, tax and investment advice.
In the event the Company does provide you with any advice in relation to Shares, such advice does not take into account your objectives, financial situation and needs.
37 |
Risk
As with any investment in securities there can be no guarantee that the market value of the Company's shares will not fall in the future. There is also no assurance as to future dividends or distributions since these are dependent on earnings and the financial condition of the Company.
Market Price of Shares
Before deciding whether to accept the Offer, you should refer to the current market price of the Company's shares, which can be obtained from the financial pages of some daily newspapers, your stockbroker, your financial adviser, or the ASX. The Company will also provide you upon request, within a reasonable time, either verbally or in writing, details of the current market price (in Australian dollars) of the Company's shares.
Please note that the market price of the Company's shares may rise or fall between the date of this Offer and the date when the Shares are issued to you upon exercise of the Options.
Next Steps
If you wish to accept the Offer and apply for Options, you must:
· | complete, sign and date the enclosed Application; and |
· | return the completed Application to IperionX at [insert address]. |
By delivering the attached application form to IperionX, you agree to be bound by the Rules and the terms of this Offer as a Participant in the Plan, as well as giving the acknowledgments contained in the Application.
Upon receipt of the Application, provided you remain employed or engaged by IperionX at that time, IperionX will take steps to issue the Options to you and to provide you with an Options Certificate or holding statement confirming the issue.
This Offer must be accepted before 5:00pm [insert time zone] on the date fourteen (14) days after the date of this letter and will expire after that time. Please get in contact with me if you need more time to consider the Offer for any reason and we can discuss.
Once again, you are a very important member of the IperionX team and we look forward to your participation in the Plan.
Yours sincerely
[Director of the Company]
Encl: | Application form |
Plan Rules |
38 |
IPERIONX INCENTIVE PLAN - OPTIONS
APPLICATION
A. | INSTRUCTIONS |
Please provide the application form to IperionX at [insert address]. All capitalised terms not otherwise defined herein have the same meaning given to them in the Plan.
B. | PERSONAL DETAILS |
Name: | |
Address: |
Pursuant to this Application (“Application”), I hereby accept the offer of Options offered to me pursuant to a Letter of Offer dated ________________ (“Offer Letter”) under the IperionX Employee Incentive Plan (“Plan”) (please check only one (1) of the following boxes):
☐ | In full. |
☐ | In respect of ____________________________ Options. |
C. | USE OF NOMINEE (NOTE: YOU MAY NOMINATE A RELATED PARTY TO ACCEPT YOUR OPTIONS ONLY IF YOU ARE NOT A U.S. RESIDENT) |
Please check only one (1) of the following boxes:
☐ | I do not wish to nominate another person to accept my Options and apply for them personally in my own name. |
☐ | I wish to nominate ___________________________________________________________________ (Insert full name) of ____________________________________________________________ (Insert address) to accept my Options and attach evidence hereto showing that they are a Related Party. |
D. | NOMINATED BENEFICIARY IN THE EVENT OF DEATH (PLEASE COMPLETE) |
☐ | I wish to nominate ____________________________________________________________________ (Insert full name) of ____________________________________________________________ (Insert address) to receive all of my Options in the event of my death. |
E. | ACKNOWLEDGEMENTS |
By accepting the Offer and delivering this form to IperionX, I agree and acknowledge:
1. | the Options are issued pursuant to the Plan and the Rules and I agree to be bound by the Rules and the terms of the Offer as a Participant in the Plan; |
2. | participation in the Plan does not create a right to employment or interfere with the ability to terminate my employment or service relationship (if any), subject to applicable law; |
39 |
3. | the future value of the Options and any Shares is uncertain and the value may increase or decrease in value from time to time; |
4. | any rights acquired under the Plan are an extraordinary item of compensation, which is outside the scope of my employment agreement, if any, and are not part of ordinary compensation or salary for any purpose; |
5. | no claim or entitlement to compensation or damages shall arise from forfeiture of Options under the Plan resulting from my service to IperionX coming to an end for any reason; |
6. | the ultimate liability for all taxes payable in respect of my participation in the Plan and the acquisition and disposal of Options and Shares is and remains my responsibility; |
7. | IperionX may be required by law to provide information about me to tax authorities and I will allow IperionX to provide such information; and |
8. | the Offer Letter provided to me is not financial product advice and I have been advised to consult an independent investment or taxation advisor prior to accepting Options if I have any concerns. |
F. | U.S. ACKNOWLEDGEMENTS (if applicable) |
I further agree and acknowledge that:
9. | the Offer Letter, the Options, and the Shares that may be obtained in connection therewith are subject to the terms, conditions, and provisions of clause 28 of the Plan, which I have read in full and to which I hereby expressly assent; |
10. | I have read and expressly acknowledge clauses 28.12 through 28.16 of the Plan with respect to their bearing on any tax consequences in connection with the Options, and the exercise thereof; |
11. | as an express condition of exercising the Options, I hereby authorize payroll withholding and otherwise will make adequate provision for all applicable tax withholding of IperionX, all as more completely described in the Plan; |
12. | IperionX does not have a duty to design or administer the Plan or its other compensation programs in a manner that minimizes my tax liabilities; |
13. | I have read expressly acknowledge those portions of clause 28 of the Plan under the heading “U.S. Securities Laws” with respect to their bearing on any legal consequences related to U.S. federal, state, or other securities laws in connection with the Options and the exercise thereof; |
14. | I am aware of IperionX’s business affairs and financial condition and have acquired sufficient information about IperionX to reach an informed and knowledgeable decision to acquire the Options and the Shares that may be obtained in connection therewith; |
15. | I have received and have access to such information as I consider necessary or appropriate for deciding whether to invest in the Shares that may be obtained in connection with the Options; |
16. | my investment in IperionX is a speculative investment that has limited liquidity and is subject to the risk of complete loss, and I am able to hold the Shares that may be obtained in connection with the Options for an indefinite period and to suffer a complete loss in my investment in such Shares; and |
17. | this Application shall inure to the benefit of and be binding upon my heirs, executors, administrators, successors, and assigns. |
40 |
G. | EXECUTION |
THIS APPLICATION IS HEREBY EXECUTED BY ____________________________:
Signature | |
Date |
H. | If a Related Party is nominated, please also complete the required details below and have the Related Party execute: |
(NOTE: YOU MAY NOMINATE A RELATED PARTY TO ACCEPT YOUR OPTIONS ONLY IF YOU ARE NOT A U.S. RESIDENT)
Please check only one (1) of the following boxes:
☐ | (if related party is a trust for which you are the trustee in your personal capacity): |
EXECUTED BY ____________________________________________________________________________ as trustee for the _______________________________________________________Trust:
Signature of trustee |
☐ | (if related party is a company you control which is the trustee of a trust): |
EXECUTED BY ________________________________________________________ ACN _______________ as trustee for the _________________________________________________________Trust in accordance with s127 of the Corporations Act 2001:
Signature of director | Signature of director/company secretary | |
Name of director (print) | Name of director/company secretary (print) |
☐ | (if related party is a company you control, not in the capacity of trustee): |
EXECUTED BY _______________________________________________ ACN _______________ in accordance with s127 of the Corporations Act 2001:
Signature of director | Signature of director/company secretary | |
Name of director (print) | Name of director/company secretary (print) |
41 |
SCHEDULE 4: PRO-FORMA OFFER LETTER - PERFORMANCE RIGHTS
[date]
[insert Participant name]
[insert Participant address]
Dear Participant
OFFER TO PARTICIPATE IN IperionX EMPLOYEE INCENTIVE PLAN
As you are aware, IperionX Limited (“IperionX”) has established an Employee Incentive Plan (“Plan”).
To incentivise people important to the development prospects of IperionX and to ensure the interests and motivations of such key persons are aligned with the interests and motivations of shareholders of IperionX, the Board of IperionX (“Board”) have elected to offer equity to some key individuals.
As a key member of the IperionX team, IperionX is delighted to offer you the opportunity to participate in the Plan on the terms set out in this letter (“Offer”) and in accordance with the rules of the Plan and the terms and conditions of the performance rights as enclosed (“Rules”).
The offer means such key persons will have an opportunity to be personally rewarded for developing the business of IperionX.
The Grant Date of Employee Incentives issued under the Plan is the date of this Offer Letter.
Enclosed is a copy of the Rules. Capitalised terms which are defined in the Rules have the same meaning in this Offer Letter.
KEY TERMS OF THE OFFER
IperionX is offering you the opportunity to acquire the following rights to be issued shares in IperionX, credited as fully paid, at no cost, subject to the satisfaction of certain Performance Criteria and/or Vesting Conditions (“Performance Rights”) for no consideration:
NUMBER OF RIGHTS OFFERED |
PERFORMANCE CONDITIONS |
VESTING CONDITIONS |
EXPIRY DATE OF RIGHTS |
[insert number of Performance Rights] | [insert performance-based conditions] | [e.g. 12 months continuous service from the Grant Date] | [insert expiry date of rights] |
The Performance Right will only be issued to you if you continue to be employed or engaged by IperionX or one of its subsidiaries at the Grant Date.
42 |
Conversion Rate
Each Performance Right will convert to one fully paid ordinary share in IperionX.
Nominee
You may nominate a Related Party to receive the Performance Rights in accordance with clause 11 of the Plan. In order to do so, you will need to include the nominee's details in the attached application (“Application”).
Notwithstanding the foregoing, if you are an Eligible Employee residing in the U.S. you cannot nominate a Related Party to receive the Performance Rights.
Quotation
The Performance Rights will not be quoted on ASX.
Other Terms Applicable to the Offer
[insert other applicable terms, if applicable, such as Performance Criteria]
For Performance Rights Granted to Participants Residing in the U.S.: PLEASE BE ADVISED that clause 28 of the Plan applies to you. Before accepting this Offer, please read the terms, provisions, and conditions of clause 28 in full (in addition to and in conjunction with the other terms, provisions, and conditions of the Plan, this Offer, and the Rules). If you have any questions regarding the same, please let me know before accepting this Offer.
The other terms and conditions applicable to the Performance Rights offered to you are described in Schedule 2 of the Plan.
Financial and Taxation Consequences
This Offer does not purport to provide all of the information you may require in order to evaluate an investment in the Company. The Company in making the Offer is not giving you any financial, legal, tax or investment advice. You should make your own enquiries and evaluations as you deem necessary of the Offer (including your investment objectives, financial situation, and particular needs), and you should seek all necessary financial, legal, tax and investment advice.
In the event the Company does provide you with any advice in relation to Shares, such advice does not take into account your objectives, financial situation and needs.
Risk
As with any investment in securities there can be no guarantee that the market value of the Company's shares will not fall in the future. There is also no assurance as to future dividends or distributions since these are dependent on earnings and the financial condition of the Company.
43 |
Market Price of Shares
Before deciding whether to accept the Offer, you should refer to the current market price of the Company's shares, which can be obtained from the financial pages of some daily newspapers, your stockbroker, your financial adviser, or the ASX. The Company will also provide you upon request, within a reasonable time, either verbally or in writing, details of the current market price (in Australian dollars) of the Company's shares.
Please note that the market price of the Company's shares may rise or fall between the date of this Offer and the date when the Shares are issued to you upon conversion of Performance Rights.
Next Steps
If you wish to accept the Offer and apply for Performance Rights, you must:
· | complete, sign and date the enclosed Application; and |
· | return the completed Application to IperionX at [insert address]. |
By delivering the attached application form to IperionX, you agree to be bound by the Rules and the terms of this Offer as a Participant in the Plan, as well as giving the acknowledgments contained in the Application.
Upon receipt of the Application, provided you remain employed or engaged by IperionX at that time, IperionX will take steps to issue the Performance Rights to you and to provide you with a Certificate or holding statement confirming the issue.
This Offer must be accepted before 5:00pm [Insert time zone] on the date fourteen (14) days after the date of this letter and will expire after that time. Please get in contact with me if you need more time to consider the Offer for any reason and we can discuss.
Once again, you are a very important member of the IperionX team and we look forward to your participation in the Plan.
Yours sincerely
[Director of the Company]
Encl: | Application form |
Plan Rules |
44 |
Pro-forma acceptance form - PERFORMANCE RIGHTS
IPERIONX INCENTIVE PLAN
APPLICATION FORM
A. | INSTRUCTIONS: |
Please provide the original application form to IperionX at [insert address]. All capitalised terms not otherwise defined herein have the same meaning given to them in the Plan.
B. | PERSONAL DETAILS |
Name: | |
Address: |
Pursuant to this Application (“Application”), I hereby accept the offer of Performance Rights offered to me pursuant to a Letter of Offer dated ________________ (“Offer Letter”) under the IperionX Employee Incentive Plan (“Plan”) (please check only one (1) of the following boxes):
☐ | In full. |
☐ | In respect of ____________________________ Performance Rights. |
C. | USE OF NOMINEE (NOTE: YOU MAY NOMINATE A RELATED PARTY TO ACCEPT YOUR PERFORMANCE RIGHTS ONLY IF YOU ARE NOT A U.S. RESIDENT) |
☐ | I do not wish to nominate another person to accept my Performance Rights and apply for them personally in my own name. |
☐ | I wish to nominate _________________________________________________________________ (Insert full name) of ____________________________________________________________ (Insert address) to accept my Performance Rights and attach evidence showing that they are a Related Party. |
D. | NOMINATED BENEFICIARY IN THE EVENT OF DEATH (PLEASE COMPLETE) |
☐ | I wish to nominate ________________________________________________________________ (Insert full name) of ____________________________________________________________ (Insert address) to receive all of my Performance Rights in the event of my death. |
E. | ACKNOWLEDGEMENT |
By accepting the Offer and delivering this form to IperionX, I agree and acknowledge:
1. | the Performance Rights are issued pursuant to the Plan and the Rules and I agree to be bound by the Rules and the terms of the Offer as a Participant in the Plan; | |
2. | participation in the Plan does not create a right to employment or interfere with the ability to terminate my employment or service relationship (if any), subject to applicable law; | |
3. | the future value of the Performance Rights and any Shares is uncertain and the value may increase or decrease in value from time to time; |
45 |
4. | any rights acquired under the Plan are an extraordinary item of compensation, which is outside the scope of my employment agreement, if any, and are not part of ordinary compensation or salary for any purpose; | |
5. | no claim or entitlement to compensation or damages shall arise from forfeiture of Performance Rights under the Plan resulting from my service to IperionX coming to an end for any reason; | |
6. | the ultimate liability for all taxes payable in respect of my participation in the Plan and the acquisition and disposal of Performance Rights and Shares is and remains my responsibility; | |
7. | IperionX may be required by law to provide information about me to Tax authorities and I will allow IperionX to provide such information; and | |
8. | the Offer Letter provided to me is not financial product advice and I have been advised to consult an independent investment or taxation advisor prior to accepting Performance Rights if I have any concerns. |
F. | U.S. ACKNOWLEDGEMENTS (if applicable): |
I further agree and acknowledge that:
9. | the Offer Letter, the Performance Rights, and the Shares that may be obtained in connection therewith are subject to the terms, conditions, and provisions of clause 28 of the Plan, which I have read in full and to which I hereby expressly assent; | |
10. | I have read and expressly acknowledge clauses 28.12 through 28.16 of the Plan with respect to their bearing on any tax consequences in connection with the Performance Rights, and the exercise thereof; | |
11. | as an express condition of exercising the Performance Rights, I hereby authorize payroll withholding and otherwise will make adequate provision for all applicable tax withholding of IperionX, all as more completely described in the Plan; | |
12. | IperionX does not have a duty to design or administer the Plan or its other compensation programs in a manner that minimizes my tax liabilities; | |
13. | I have read expressly acknowledge those portions of clause 28 of the Plan under the heading “U.S. Securities Laws” with respect to their bearing on any legal consequences related to U.S. federal, state, or other securities laws in connection with the Performance Rights and the exercise thereof; | |
14. | I am aware of IperionX’s business affairs and financial condition and have acquired sufficient information about IperionX to reach an informed and knowledgeable decision to acquire the Performance Rights and the Shares that may be obtained in connection therewith; | |
15. | I have received and have access to such information as I consider necessary or appropriate for deciding whether to invest in the Shares that may be obtained in connection with the Performance Rights; | |
16. | my investment in IperionX is a speculative investment that has limited liquidity and is subject to the risk of complete loss, and I am able to hold the Shares that may be obtained in connection with the Performance Rights for an indefinite period and to suffer a complete loss in my investment in such Shares; and | |
17. | this Application shall inure to the benefit of and be binding upon my heirs, executors, administrators, successors, and assigns. |
46 |
G. | EXECUTION |
THIS APPLICATION IS HEREBY EXECUTED BY ____________________________:
Signature | |
Date |
H. | If a Related Party is nominated, please also complete the required details below and have the Related Party execute: |
(NOTE: YOU MAY NOMINATE A RELATED PARTY TO ACCEPT YOUR PERFORMANCE RIGHTS ONLY IF YOU ARE NOT A U.S. RESIDENT)
Please check only one (1) of the following boxes:
☐ | (if related party is a trust for which you are the trustee in your personal capacity): |
EXECUTED BY ___________________________________________________________________________ as trustee for the _______________________________________________________Trust:
Signature of trustee |
☐ | (if related party is a company you control which is the trustee of a trust): |
EXECUTED BY _______________________________________________________ ACN _______________ as trustee for the _________________________________________________________Trust in accordance with s127 of the Corporations Act 2001:
Signature of director | Signature of director/company secretary | |
Name of director (print) | Name of director/company secretary (print) |
☐ | (if related party is a company you control, not in the capacity of trustee): |
EXECUTED BY ______________________________________________________ ACN _______________ in accordance with s127 of the Corporations Act 2001:
Signature of director | Signature of director/company secretary | |
Name of director (print) | Name of director/company secretary (print) |
47 |
Table of Contents
|
|
Clause
|
Page No
|
1.
|
Definitions and Interpretation
|
1
|
1.1
|
Definitions
|
1
|
1.2
|
General
|
4
|
1.3
|
Headings
|
5
|
1.4
|
Business Day
|
5
|
2.
|
Indemnity
|
5
|
2.1
|
Liabilities and Costs
|
5
|
2.2
|
Other Indemnities
|
5
|
2.3
|
Limitation on Indemnity
|
5
|
2.4
|
Continuation of Indemnity
|
5
|
2.5
|
Payment under the Indemnity
|
6
|
2.6
|
Liability not Affected
|
6
|
2.7
|
Void or Voidable Transactions
|
6
|
3.
|
Insurance
|
7
|
3.1
|
Company to Insure Officer
|
7
|
3.2
|
Subrogation or Action against the Company
|
7
|
3.3
|
Insurance Run-Off Period
|
7
|
3.4
|
Maintenance and Production of Policy
|
7
|
3.5
|
Copy of Policy
|
8
|
3.6
|
Full disclosure and Compliance with Policies
|
8
|
3.7
|
Not Prejudice Insurance
|
8
|
4.
|
Officer's Ownership of Company Records
|
8
|
5.
|
Officer’s Right to have Access to Company Records
|
8
|
5.1
|
Company’s Obligation to Retain
|
8
|
5.2
|
Officer’s Right to have Access
|
9
|
5.3
|
Officer’s Right to Copy
|
9
|
6.
|
Privileged Advice
|
9
|
6.1
|
Company Undertaking
|
9
|
6.2
|
Conflict of Interest
|
9
|
6.3
|
Privilege
|
9
|
6.4
|
Joint Privilege
|
9
|
6.5
|
Relevant Companies
|
10
|
7.
|
Notification and Settlement of Liabilities
|
10
|
7.1
|
Officer to Notify Company
|
10
|
7.2
|
Company to Notify Officer
|
10
|
7.3
|
Company obligations
|
10
|
8.
|
Company Merger
|
11
|
9.
|
Shareholder Approval a Condition Precedent
|
11
|
10.
|
Costs and Duties
|
11
|
10.1
|
Costs
|
11
|
10.2
|
Duties
|
11
|
Table of Contents
|
|
Clause
|
Page No
|
11.
|
Notices
|
11
|
11.1
|
Notices
|
11
|
11.2
|
Address for Service
|
12
|
12.
|
General
|
12
|
12.1
|
Governing Law
|
12
|
12.2
|
Jurisdiction
|
12
|
12.3
|
Severability
|
12
|
12.4
|
Amendments
|
12
|
12.5
|
Waiver
|
13
|
12.6
|
Further Acts
|
13
|
12.7
|
Approvals
|
13
|
12.8
|
Assignment
|
13
|
12.9
|
Entire Agreement
|
13
|
12.10
|
Counterparts
|
13
|
Parties
|
[insert name] of [insert address] (Officer)
|
and
|
|
IperionX Limited of Level 9, 28 The Esplanade, Perth, Western Australia 6000 (Company)
|
A. |
The Officer is a director of the Company.
|
B. |
The Company’s constitution provides that every director and company secretary of the Company is indemnified out of the assets of the Company to the full extent permitted by law, and that the Company may enter into contracts or agreements
to reflect matters relating to the indemnity, insurance and access of such directors or company secretary.
|
C. |
The Corporations Act provides that the Company must provide directors with access to certain documents.
|
D. |
The Company has agreed to indemnify the Officer in respect of certain liabilities incurred by the Officer while acting as a director of the Company.
|
E. |
The Company has agreed to insure the Officer against certain risks the Officer is exposed to as an officer of the Company.
|
F. |
The Company has agreed to grant a right of access to certain Company Records to the Officer.
|
1. |
Definitions and Interpretation
|
1.1 |
Definitions
|
(a) |
is required to keep by law; or
|
(b) |
circulates to the Officer or other Officers of the Company for the purposes of meetings of:
|
(i) |
the Board;
|
(ii) |
a subcommittee of the Board; or
|
(iii) |
the Company,
|
(c) |
monthly or periodical board papers;
|
(d) |
submissions, agendas, minutes;
|
(e) |
letters, memoranda and correspondence between the Company and third parties, such as regulatory authorities and legal and other advisers to the Company;
|
(f) |
Board sub papers;
|
(g) |
copies of other documents prepared for the Board, made available to any Officer of the Company or referred to in any of the above documents; and
|
(h) |
legal advices or opinions obtained by the Company.
|
(i) |
is required to keep by law; or
|
(j) |
circulates to the Officer or other Officers of the Relevant Company for the purposes of meetings of:
|
(i) |
the Board;
|
(ii) |
a subcommittee of the Board; or
|
(iii) |
the Relevant Company,
|
(k) |
monthly or periodical board papers;
|
(l) |
submissions, agendas, minutes;
|
(m) |
letters, memoranda and correspondence between the Relevant Company and third parties, such as regulatory authorities and legal and other advisers to the Relevant Company;
|
(n) |
Board sub papers;
|
(o) |
copies of other documents prepared for the Board, made available to any Officer of the Relevant Company or referred to in any of the above documents; and
|
(p) |
legal advices or opinions obtained by the Relevant Company.
|
(a) |
the date 7 years after the Retirement Date; or
|
(b) |
where run-off insurance cannot be procured at reasonable Policy premiums for the full period in paragraph (a), the latest date to which run-off insurance can be procured.
|
(a) |
in defending any proceedings relating to the Officer’s position with the Company or a Relevant Company, whether civil or criminal, in which judgment is given in the Officer’s favour or in which the Officer is acquitted or which are
withdrawn before judgment;
|
(b) |
in connection with any administrative proceedings relating to the Officer’s position with the Company or a Relevant Company, except proceedings which give rise to civil or criminal proceedings against the Officer in which judgment is not
given in the Officer’s favour or in which the Officer is not acquitted or which arise out of conduct involving a lack of good faith; or
|
(c) |
in connection with any proceedings relating to the Officer’s position with the Company or a Relevant Company, whether civil or criminal, in which relief is granted to the Officer under the Corporations Act by the court.
|
(a) |
commencing on the later of:
|
(i) |
the date being 7 years before the date of this Deed; or
|
(ii) |
the date of the incorporation of the Company; and
|
(b) |
expiring on the date 7 years after the Retirement Date.
|
(a) |
the Officer;
|
(i) |
is removed; or
|
(ii) |
resigns (except where the Officer retires from office and seeks re-election pursuant to the Company's constitution, and is duly re-elected),
|
(b) |
the Officer’s office is vacated or the Officer is disqualified from holding such office by operation of law, as a matter of contract or for any other reason whatsoever.
|
1.2 |
General
|
(a) |
a reference to any legislation or legislative provision includes any statutory modification or re-enactment of, or legislative provision substituted for, and any subordinate legislation under, that legislation or legislative provision;
|
(b) |
the singular includes the plural and vice versa;
|
(c) |
a reference to an individual or person includes a corporation, firm, partnership, joint venture, association, authority, trust, state or government and vice versa;
|
(d) |
a reference to any gender includes all genders;
|
(e) |
a reference to a recital or clause is to a recital or clause of this Deed;
|
(f) |
a recital forms part of this Deed;
|
(g) |
a reference to any agreement or document is to that agreement or document (and, where applicable, any of its provisions) as amended, notated, supplemented or replaced from time to time;
|
(h) |
a reference to any party to this Deed or any other document or arrangement includes that party’s executors, administrators, substitutes and successors;
|
(i) |
a reference to "dollar” or “$” is to Australian dollars; and
|
(j) |
where an expression is defined, another part of speech or grammatical form of that expression has a corresponding meaning.
|
1.3 |
Headings
|
1.4 |
Business Day
|
2. |
Indemnity
|
2.1 |
Liabilities and Costs
|
(a) |
all liabilities incurred by the Officer as a director of the Company or a Relevant Company; and
|
(b) |
without limiting subparagraph (a), all Legal Expenses incurred by the Officer as a director of the Company or a Relevant Company.
|
2.2 |
Other Indemnities
|
2.3 |
Limitation on Indemnity
|
2.4 |
Continuation of Indemnity
|
2.5 |
Payment under the Indemnity
|
2.6 |
Liability not Affected
|
(a) |
the Officer granting time, waiver or other indulgence or concession to, or making any composition or compromise with the Company;
|
(b) |
the full, partial or conditional release or discharge by the Officer or by operation of law, at any time, of the Company from this Deed or any other document; or
|
(c) |
the Officer agreeing with the Company not to sue, issue process, sign or execute judgment, commence proceedings for bankruptcy or liquidation, participate in any administration, scheme or deed of arrangement or reconstruction, prove in
any bankruptcy or liquidation or do any other act, matter or thing in respect of the liability of the Company.
|
2.7 |
Void or Voidable Transactions
|
(a) |
the Officer has at any time released or discharged the Company from its obligations under this Deed in reliance on a payment, receipt or other transaction to or in favour of the Officer; or
|
(b) |
any payment or other transaction to or in favour of the Officer has the effect of releasing or discharging the Company from its obligations under this Deed; and
|
(c) |
that payment, receipt or other transaction is subsequently claimed by any person to be void, voidable or capable of being set aside for any reason, including under an Insolvency Provision or under the general law; and
|
(d) |
that claim is upheld, conceded or compromised, then:
|
(i) |
restitution of rights: the Officer will immediately become entitled against the Company to all such rights as the Officer had immediately before that release or discharge;
|
(ii) |
restore Officer’s position: the Company must immediately do all things and execute all documents as the Officer may reasonably require to restore to the Officer all those rights; and
|
(iii) |
indemnity: the Company must indemnify and keep indemnified the Officer against costs, losses and expenses suffered or incurred by the Officer in or in connection with any negotiations or proceedings relating to the claim or as a result
of the upholding, concession or compromise of the claim.
|
3. |
Insurance
|
3.1 |
Company to Insure Officer
|
(a) |
Subject to clause 3.4 and to the extent permitted by law, the Company must during the Term and the Insurance Run-Off Period pay the premium for (or ensure the payment of premiums for) an insurance policy which insures the Officer against
all liabilities incurred by the Officer acting directly or indirectly as a director of the Company or a Relevant Company.
|
(b) |
The Insurance Policy to be effected under clause 3.1(a) must:
|
(i) |
be effected with a reputable and solvent insurer (other than the Company); and
|
(ii) |
insure the Officer for Costs incurred by the Officer in defending proceedings, whether civil or criminal and whatever their outcome, except to the extent that the Company may be unable to obtain insurance to defend criminal proceedings
where the Officer is not acquitted.
|
3.2 |
Subrogation or Action against the Company
|
3.3 |
Insurance Run-Off Period
|
3.4 |
Maintenance and Production of Policy
|
(a) |
to the extent permitted by law, maintain the Policies;
|
(b) |
to the extent permitted by law, duly and punctually pay or cause to be paid all premiums and other money payable by it under the Policies, and if the Company cannot lawfully pay any part of the premium under the Policies it must give the
Officer notice of that fact and give the Officer a reasonable opportunity to contribute to that part of the premium to the extent to which that part is attributable to the Officer (if such contribution is necessary for the Policies to be
effective);
|
(c) |
perform, observe and fulfil those terms of the Policies to be performed, observed or fulfilled by it;
|
(d) |
produce to the Officer copies of the Policies and certificates of currency or the receipts for the payment of each premium and all other money payable in respect of each Policy (or other evidence of payment satisfactory to the Officer)
on or before the due date for renewal; and
|
(e) |
ensure that no Policy is capable of being avoided as against the Officer as a result of a breach of the duty of disclosure by any party or person other than the Officer.
|
3.5 |
Copy of Policy
|
3.6 |
Full disclosure and Compliance with Policies
|
3.7 |
Not Prejudice Insurance
|
(a) |
render any part of a Policy void, voidable or otherwise unenforceable; or
|
(b) |
hinder or prevent the recovery of any money in respect of a Policy,
|
4. |
Officer's Ownership of Company Records
|
5. |
Officer’s Right to have Access to Company Records
|
5.1 |
Company’s Obligation to Retain
|
(a) |
keep a complete set of all Company Records to which the Officer is entitled to access under clause 5.2, in order and in suitable, secure custody for the Retention Period; and
|
(b) |
nominate a person or persons from time to time to take custody of the Company Records and regulate access to them.
|
5.2 |
Officer’s Right to have Access
|
(a) |
the Officer’s holding of office as a director in respect of the Company or a Relevant Company; or
|
(b) |
any claim which the Officer reasonably anticipates may be made against the Officer in relation to matters arising in the course of the Officer acting in connection with the affairs of the Company or a Relevant Company or otherwise
concerning or relating to the Officer’s holding of office as a director in respect of the Company or a Relevant Company
|
5.3 |
Officer’s Right to Copy
|
6. |
Privileged Advice
|
6.1 |
Company Undertaking
|
6.2 |
Conflict of Interest
|
6.3 |
Privilege
|
6.4 |
Joint Privilege
|
6.5 |
Relevant Companies
|
7. |
Notification and Settlement of Liabilities
|
7.1 |
Officer to Notify Company
|
(a) |
notify the Company if proceedings are anticipated, threatened or commenced against the Officer which may give rise to a liability of the Company, immediately after becoming aware of the same; and
|
(b) |
must not settle or compromise any claim referred to in clause 7.1(a) or make any admission or payment in relation to such a claim without the prior written consent of the Company, and will provide the Company, with a copy of any
originating proceedings or other materials served on, supplied to, or otherwise within the possession of the Officer in connection with such proceedings unless the Officer receives legal advice that to do so may cause substantial or
material prejudice to the interests of the Officer.
|
7.2 |
Company to Notify Officer
|
(a) |
proceedings are anticipated, threatened or commenced against the Company or a Relevant Company; and
|
(b) |
such proceedings or the facts giving rise to them may:
|
(i) |
result in a claim against the Officer; or
|
(ii) |
require the Officer to consider his legal position,
|
7.3 |
Company obligations
|
(a) |
use its best endeavours to ensure that the Officer's reputation is not injured; and
|
(b) |
not settle any claim without the Officer's prior written approval unless it reasonably believes that money is available to pay the settlement amount and all costs and disbursements.
|
8. |
Company Merger
|
9. |
Shareholder Approval a Condition Precedent
|
10. |
Costs and Duties
|
10.1 |
Costs
|
10.2 |
Duties
|
11. |
Notices
|
11.1 |
Notices
|
(a) |
must be in writing in order to be valid;
|
(b) |
is sufficient if executed by the party giving, serving or making the notice or on its behalf by any attorney, director, secretary, other duly authorised officer or solicitor of such party;
|
(c) |
will be deemed to have been duly served, given or made in relation to a person if it is delivered or posted by prepaid post to the address, or sent by facsimile to the number of that person set out in clause 11.2 of this Deed (or at such
other address or number as is notified in writing by that person to the other parties from time to time); and
|
(d) |
will be deemed to be served, given or made:
|
(i) |
(in the case of prepaid post) on the second business day after the date of posting;
|
(ii) |
(in the case of facsimile) on receipt of a transmission report confirming successful transmission;
|
(iii) |
(in the case of email), at the time shown in the delivery confirmation report generated by the sender’s email system which indicates that the email was sent to the recipient’s email address; and
|
(iv) |
(in the case of delivery by hand) on delivery.
|
11.2 |
Address for Service
|
12. |
General
|
12.1 |
Governing Law
|
12.2 |
Jurisdiction
|
(a) |
Acceptance of jurisdiction: Each of the parties irrevocably submits to and accepts generally and unconditionally, the non-exclusive jurisdiction of the courts and appellate courts of Western Australia with respect to any legal action or
proceedings which may be brought at any time relating in any way to this Deed.
|
(b) |
No objection to inconvenient forum: Each of the parties irrevocably waives any objection it may now or in the fixture have to the venue of any action or proceedings, and any claim it may now or in the future have that the action or
proceeding has been brought in an inconvenient forum.
|
12.3 |
Severability
|
12.4 |
Amendments
|
12.5 |
Waiver
|
12.6 |
Further Acts
|
12.7 |
Approvals
|
12.8 |
Assignment
|
12.9 |
Entire Agreement
|
12.10 |
Counterparts
|
Signed by [insert name] in the presence of:
|
)
)
)
|
|
Signature
|
||
|
||
Signature of Witness
|
||
|
||
Name of Witness in full
|
Executed by IperionX Limited in
accordance with section 127 of the
Corporations Act:
|
)
)
)
)
|
|
|
||
Signature of Director
|
Signature of Secretary/other Director
|
|
|
||
Name of Director in full
|
Name of Secretary/other Director in full
|
Exhibit 15.1
CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
We hereby consent to the use in this Registration Statement on Form 20-F of IPERIONX LIMITED of our report dated 17 February 2022 relating to the consolidated financial statements of IperionX Limited (formerly Hyperion Metals Limited and Tao Commodities Limited), which appears in this Registration Statement.
We also hereby consent to the use in this Registration Statement on Form 20-F of IPERIONX LIMITED of our report dated 17 February 2022, except for Note 1(x) which is dated 29 March 2022, relating to the consolidated financial statements of IperionX Limited (formerly Hyperion Metals Limited and Tao Commodities Limited), which appears in this Registration Statement.
We also consent to the references to us under the headings “Statement by Experts” in such Registration Statement.
/s/ PricewaterhouseCoopers LLP
Perth, Australia
March 29, 2022