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Updated Rights Issue and Options Priority Offer

Rights Issue and Options Priority Offer

Reach Resources Limited (ASX: RR1 & RR1O) (“Reach” or “the Company”) is pleased to announce its intention to undertake a non-renounceable rights issue of 1 fully paid ordinary share in the capital of the Company (“Share”) for every 3 Shares held by eligible shareholders at an issue price of $0.002 per Share (pre-consolidation) or $0.01 (post-consolidation), together with 1 free attaching option to acquire a Share (“Option”) for every 2 Shares subscribed for and issued, to raise up to approximately $2.14 million (“Rights Issue”).

Each Option issued under the Rights Issue will be exercisable within 3 years from the date of issue with an exercise price of $0.003 (pre-consolidation) or $0.015 (post consolidation) (“New Options”).

In addition to the Rights Issue, the Company will be offering eligible holders of the existing RR1O listed Options (“RR1O Options”) a non-renounceable priority offer to subscribe for 1 New Option for every 1 RR1O held at an issue price of $0.0002 (pre-consolidation) or $0.001 (post-consolidation) per New Option to raise up to approximately a further $0.26 million (“Priority Offer”). The issue of the New Options under the Priority Offer will be subject to shareholder approval and will occur following the consolidation (which is further discussed below).

The Company intends to apply for the quotation of the New Options to be issued under the Rights Issue and the Priority Offer (together, the “Offers”).

Funds raised under the Offers will be allocated towards funding the exploration of the Company’s projects and for general working capital purposes.

The Company has engaged Westar Capital Limited (AFSL 255789) (“Westar”) to act as lead manager for the Offers. In consultation with the Company, Westar will have the exclusive right to the placement of any shortfall.

The Company intends to release a prospectus for the Rights Issue to its ASX platform on Friday, 1 March 2024 (“Rights Issue Prospectus”) following the lodgement of the Rights Issue Prospectus with ASIC. A prospectus for the Priority Offer (“Priority Offer Prospectus”) will be lodged with ASIC following the completion of the consolidation (which is further discussed below).

Eligible shareholders should consider the Rights Issue Prospectus in deciding whether to acquire securities under the Rights Issue and will need to complete the personalised entitlement and acceptance form that will accompany the Priority Offer Prospectus.

The Company advises that, should they be eligible, the Directors intend to take up any entitlements available to them under the Offers. As at the date of this announcement, the Directors are not eligible to participate in the Offers.

Lead Manager

Fees Pursuant to the Company’s lead manager mandate with Westar, the Company has agreed to pay Westar:

(a) a 6% fee on the gross proceeds raised under the Offers; and

(b) a $35,000 signing fee.


Subject to receipt of shareholder approval at the Company’s upcoming General Meeting to be held early April 2024, the Company plans to consolidate its issued capital on a 1 for 5 basis (“Consolidation”). The Consolidation will become effective post the issue of Securities under the Rights Issue.

The Consolidation will apply equally to all shareholders, individual shareholdings will be reduced in the same ratio as the total number of shares (subject to rounding of fractions). The Consolidation will have no material effect on the percentage interest in the Company of each shareholder from a preconsolidation basis to a post-consolidation basis. All references in this announcement are on a preconsolidation basis.

Shareholders will be given the opportunity to vote on this at a General Meeting with more details to be provided in the associated Notice of Meeting.

The indicative timetable for the Offers and Consolidation is set out at Annexure 1. As is further set out in this timetable, the Priority Offer will be undertaken following the completion of the Consolidation. This is not what was originally envisaged when the Company announced the Priority Offer by way of the Appendix 3B that was released on 19 February 2024 (“Original 3B”). It is for this reason that the Original 3B has been cancelled, and will be replaced in due course by a revised Appendix 3B.

This announcement has been authorised by the Board of Reach Resources Limited

For further information please contact:

Jeremy Bower

Chief Executive Officer Level 4, 216 St Georges Terrace Perth, 6000 W.A


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