Orion Minerals : announces capital raising to advance early production strategy at SA base metal projects | MarketScreener

Orion Minerals Limited

Incorporated in the Commonwealth of Australia

Australian Company Number 098 939 274

ASX share code: ORN

JSE share code: ORN

ISIN: AU000000ORN1

Orion announces capital raising to advance early production strategy at SA base metal projects

Three-tranche Placement to sophisticated and professional investors to raise up to $20 million at 2.0 cents per share (being ZAR22 cents).

Committed funds for Tranche 1 and Tranche 2 total $6 million, with commitments for Tranche 3 currently being finalised. Due to the downturn in global capital markets since the Company went into a trading halt on 10 June 2022, numerous potential participants have requested additional time to finalise their involvement.

Together with other funding sources, the capital raise will put Orion in a strong position to access the recently announced US$87 million funding package from Triple Flag Precious Metals to underpin the early production strategy for the flagship Prieska Copper-Zinc Mine.

Funds to be used principally to progress the development of Prieska, including the commencement of mine dewatering and the completion of feasibility studies for the Early Production Scenario.

In addition to the Placement, a Share Purchase Plan will be offered to provide eligible shareholders with the opportunity to subscribe for new Shares in parcels starting from $2,000 (or ZAR20,000) up to a maximum of $30,000 (or ZAR300,000) at an issue price of 2.0 cents per Share (ZAR22 cents). This will provide existing shareholders with the opportunity to participate in this capital raise at the same offer price as the Shares issued under the Placement.

Orion Minerals Limited (ASX/JSE: ORN) (Orion or the Company) is pleased to advise that it is undertaking a capital raising to underpin the next phase of development of its portfolio of advanced base metal assets in South Africa’s Northern Cape Province.

Thanks to the support of existing and new investors, the Company has received firm commitments for the first two tranches (~$6 million) of a three-tranche Placement targeting up to $20 million, to underpin its Early Production Strategy at the flagship Prieska Copper-Zinc Project.

Due to the extreme volatility which has been experienced in global financial markets since the Company went into a trading halt on 10 June 2022, the capital raising is being undertaken in three tranches to provide additional time for potential participants in the third tranche to finalise their involvement.

The Company will also offer a Share Purchase Plan to all existing eligible shareholders in parallel with the placement, providing existing shareholders with an opportunity to participate in the capital raising at the same offer price as the Shares issued under the Placement.

Together with other funding sources, the combined proceeds of the Placement and SPP will put the Company in a strong position to progress towards development of its key near-term production assets in the second half of 2022, helping to realise its vision of becoming a fully-integrated producer of future-facing metals in South Africa’s Northern Cape Province.

Share Purchase Plan

In addition to the Placement, Orion is pleased to announce a share purchase plan (SPP) providing shareholders an opportunity to increase their shareholding in the Company at the same offer price as the Shares issued under the Placement.

The Company is offering its shareholders with a registered address in Australia, New Zealand, South Africa, the European Union (Germany and Netherlands), Jersey (Channel Islands), Mauritius, Seychelles, Singapore and the United Kingdom as at 7.00pm (Melbourne time) on 21 June 2022 (Eligible Shareholders) the opportunity to purchase Shares under a SPP. The application for SPP shares will be capped at the statutory maximum of $30,000 per Eligible Shareholder, across all holdings.

Purpose of the SPP

The SPP offer will give Eligible Shareholders the opportunity to participate in the Company’s capital raising on substantially the same terms on which Shares are being issued under the Company’s Placement (refer above).

It is intended that the proceeds of the SPP will be used by the Company principally to progress the development of the Company’s Prieska Copper-Zinc Mine, including the commencement of mine dewatering and the completion of feasibility studies for the Prieska Copper-Zinc Mine Early Production Scenario, progress the Okiep Copper Project feasibility study, and battery precursor product production test work on Jacomynspan nickel- copper-cobalt PGE project, in the Northern Cape of South Africa and related activities and otherwise for general working capital purposes.

Details of the SPP

The Company expects that the SPP will open on 28 June 2022 (Orion is expecting to release the SPP booklet to the ASX on this date) and is expected to close at 7:00pm (Melbourne time) on 5 August 2022.

Under the SPP, each Eligible Shareholder will be entitled to apply for parcels of new Shares from a minimum parcel of $2,000 (or ZAR20,000) up to a maximum of $30,000 (or ZAR300,000) without incurring brokerage or transaction costs. The issue price will be 2.0 cents per Share (being ZAR22 cents). This represents a 13% discount to the volume weighted average price of Orion’s shares on the ASX during the 5 trading days immediately prior to the announcement date of the SPP.

The Company will issue up to150 million SPP Shares under the SPP at an issue price of 2.0 cents per Share (ZAR22 cents) (being the same issue price as Shares issued under the Placement (refer above)). The Company is seeking to raise up to $3 million from the issue of SPP Shares. The Company, however, reserves the absolute discretion to determine the final amount raised under the SPP and may accept oversubscriptions or scale back any application at Board’s discretion.

The SPP Shares will be issued at 2.0 cents per Share (ZAR22 cents). All SPP Shares will be quoted on either the ASX or JSE (for South African Eligible Shareholders) and will rank equally with other fully paid ordinary shares on issue. No shareholder approval is necessary in respect of the Shares issued under the terms of the SPP.

The SPP booklet containing further details of the SPP and application forms is expected to be sent to shareholders shortly. Eligible Shareholders should read the SPP booklet before deciding whether to participate in the SPP. An indicative timetable for the SPP is set out below.

SPP Important Dates1

1Orion may vary any of the above dates in its absolute discretion by lodging a revised timetable with the ASX and the JSE.

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General Meeting

The Company will seek the required shareholder approvals for Tranche 2 and Tranche 3 of the Placement, at a General Meeting of shareholders planned to be held on or around 11 August 2022.

Appendix 3B filings for the proposed issue of Shares will follow this announcement.

For and on behalf of the Board.

Errol Smart

Managing Director and CEO

22 June 2022

ENQUIRIES

Disclaimer

This release may include forward-looking statements. Such forward-looking statements may include, among other things, statements regarding targets, estimates and assumptions in respect of metal production and prices, operating costs and results, capital expenditures, mineral reserves and mineral resources and anticipated grades and recovery rates, and are or may be based on assumptions and estimates related to future technical, economic, market, political, social and other conditions. These forward-looking statements are based on management’s expectations and beliefs concerning future events. Forward-looking statements inherently involve subjective judgement and analysis and are necessarily subject to risks, uncertainties and other factors, many of which are outside the control of Orion. Actual results and developments may vary materially from those expressed in this release. Given these uncertainties, readers are cautioned not to place undue reliance on such forward-looking statements. Orion makes no undertaking to subsequently update or revise the forward- looking statements made in this release to reflect events or circumstances after the date of this release. All information in respect of Exploration Results and other technical information should be read in conjunction with Competent Person Statements in this release (where applicable). To the maximum extent permitted by law, Orion and any of its related bodies corporate and affiliates and their officers, employees, agents, associates and advisers:

• disclaim any obligations or undertaking to release any updates or revisions to the information to reflect any change in expectations or assumptions;
• do not make any representation or warranty, express or implied, as to the accuracy, reliability or completeness of the information in this release, or likelihood of fulfilment of any forward-looking statement or any event or results expressed or implied in any forward-looking statement; and
• disclaim all responsibility and liability for these forward-looking statements (including, without limitation, liability for negligence).

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