Comet Resources Limited(Comet or Company) (ASX: CRL) announces that following the discontinuation of the proposed acquisition of the Mount Margaret Copper Project, it is now seeking to raise up to $1.5 million via secured convertible loans to support the Company’s proposed plan to seek re-quotation of its shares on the ASX. Full details of the terms of the convertible loans are provided below. The proceeds of the convertible loans will be used by Comet to progress exploration at the Barraba Copper Project in New South Wales, and the Northern Territory base and precious metals projects and provide working capital as it seeks to complete the process for re-quotation of its securities.
KEY POINTS:
- The Company is seeking to raise up to $1.5m in secured convertible loans to support reinstatement of its shares to trading on the ASX. A shareholder meeting will be announced shortly to seek relevant approvals
- An entitlement issue, which will give all eligible shareholders the right to participate, will also be launched to raise additional funds to meet the financial conditions for reinstatement should the Company receive approval from the ASX for reinstatement. An application for reinstatement is currently with the ASX for review
- International Graphite Limited (ASX:IG6) will subscribe for $250K in the convertible loans and may also underwrite a portion of the entitlements issue as part of a plan to further increase ties with Comet
- To maximise the amount of cash available for future exploration, Management and the Board plan to convert existing debts of up to $400K into equity by partially underwriting the entitlements issue
- The Managing Director will also forgive $50K in salary and work on half salary until the Company is reinstated
Comet has now submitted an application to the ASX setting out its recapitalisation strategy to seek re-instatement of its shares to trading. Once the Company has received advice from the ASX on the process for re-instatement and the conditions required to be met prior to re- quotation of the shares, shareholders will be updated via an ASX announcement and webinar. It should be noted that there is no guarantee that the ASX will approve re-instatement.
In addition to its exploration assets, the Company continues to hold 40,000,000 shares in International Graphite Limited (ASX:IG6), worth approximately $9 million based on recent share prices. These shares are escrowed until 7 April 2024.
International Graphite Limited (IG) will contribute $250,000 into the convertible loan and will act as security trustee for convertible loan investors. IG may invest further into Comet by providing underwriting for a portion of the planned entitlement issue. Both IG and Comet plan to increase ties further over time.
Click here for the full ASX Release
This article includes content from Comet Resources, licensed for the purpose of publishing on Investing News Australia. This article does not constitute financial product advice. It is your responsibility to perform proper due diligence before acting upon any information provided here. Please refer to our full disclaimer here.
