Wrap Text
Copper 360 raises R274 million by way of Debt and Equity to fund the Nama Copper Acquisition and Expanded Production
Copper 360 Limited
(Formerly Big Tree Copper Limited)
(Incorporated in the Republic of South Africa)
Registration number 2021/609755/06
JSE Share Code: CPR ISIN: ZAE000318531
("Copper 360" or "the Company")
Copper 360 raises R274 million by way of Debt and Equity to fund the Nama Copper Acquisition and Expanded Production Growth plan
for the Rietberg Mine.
Highlights
• Total capital of R274 million secured.
• R189 million is raised by through debt.
• R85 million is raised by the issue of new equity.
• New equity represents less than 6% of total issued share capital but provides 6,253 tons of additional copper metal forecast
for 2025 FY and 2026 FY representing additional forecast sales of R1 billion (at US$8,500/t copper and exchange rate of 19 ZAR
to USD)
• Capital raised will fund the acquisition of Nama Copper and additional capital expenditure for the new mine plan at Rietberg
Mine that will target 85% more production than initially planned at listing as well as a Generator Power Plant.
• Further equity and royalty commitments for a further R50 million is being negotiated that could see the total capital number
increase to R324 million.
Jan Nelson, CEO of Copper 360, South Africa's only listed copper producer, commented; "Our ability to raise additional capital in very difficult
financial markets whilst several major producers are retrenching people and cutting growth is a testament not only to the value investors see
in the copper price but also the value Copper 360 offers all stakeholders. Our acquisition of Nama Copper is now fully funded, and this ensures
that we will double our production in the 2025 FY. We will have 3 new copper processing plants in production by February 2025 and our new
Rieberg Copper Mine comes online early in 2025. The bottom line is we forecast to deliver R1 billion more in copper sales than originally
planned at listing which more than easily justified the slight dilution to shareholders as 70% of new capital is financed through debt."
"We have structured the capital raised through several financial instruments resulting in minimum dilution to shareholders and maximum
flexibility to the company in terms of repayment term and ability and balance sheet stability and margin. Having the balance sheet fully
funded with some additional cash ensures delivery risk is mitigated and unforeseen events funded. This comes at very minimal dilution to
shareholders and positions the Company for significant growth and success."
Any forward looking statements contained in this announcement have not been reviewed nor reported on by the Company's external
auditors.
AGREEMENTS
The Company has secured total capital of R274 million (Two hundred and seventy-four million Rand) to fund (a) the acquisition of Nama
Copper (b) the increased capital required for the Rietberg Mine that has doubled in terms of projected copper output capacity. The
source of capital is as follows:
Funding type Amount (ZAR)
Debt 189 000 000
Equity 85 000 000
Total 274 000 000
The capital will have the following impact on the production forecast:
Copper metal tonnes per annum
FY 2025 FY 2026 Percentage change
Forecast at listing 5 099 6 363 25%
New forecast (application of capital) 9 789 14 778 51%
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1. LOAN AGREEMENTS
The Company has entered into three loan agreements for a total consideration of R189 million (Hundred and eighty nine million Rand)
which is summarised in the table below and more fully described in the sections that follow:
Entity Nationality Related party Loan Quantum (ZAR) Repayment
period (months)
Handa Mining Corporation Canada Yes 74 000 000 6
Diaruk (Pty) Ltd South Africa No 10 000 000 6
Darmane (Pty) Ltd South Africa Yes 30 000 000 6
High West Capital Partners Singapore No 75 000 000 60
Total 189 000 000
1.1 "HMC" LOAN AGREEMENT
Handa Mining Corporation ("HMC") a company duly incorporated pursuant to the laws of the province of British Columbia, Canada, with
company number BC0865902, has entered into an agreement with Copper 360 dated 18 December 2023 to lend the company US$3,9
million (Three million nine hundred thousand United Stated dollars) or approximately ZAR74 million (Seventy four million Rand). The
material terms of the agreement are as follows:
• The Loan is repayable by no later than 6 months after the effective date which is the date on which Modular Floatation Plant
1 ("MFP 1") is successfully commissioned.
• The loan will be subject to interest calculated at 6% (six percent) simple interest per annum.
Effective Date
The effective date of the HMC loan is 18 December 2023.
Commission
HMC through a local South African subsidiary will receive a commission on the Revenue generated by MFP 1 of 1.5% for a period of 234
months. The commission is payable as a fee for arranging the debt finance under the HMC loan agreement and will be paid from the
date of plant commissioning and will be calculated monthly in arrears and paid within 15 days of the last day of the month.
Related Party
Jan Nelson the current CEO of Copper 360 is also the CEO of HMC and therefore considered a related party to the transaction. As a
result, a Fairness opinion on the commercial terms of the agreement will be obtained and will be available for inspection as set out in 6
below.
1.2 DIARUK (PTY) LTD LOAN AGREEMENT
On 18 December 2023 the Company entered into a loan agreement with Diaruk (Pty) Limited ("Diaruk") registration number
1986/005228/07, a company incorporated in accordance with the laws of the Republic of South Africa whereby Diaruk will lend the
Company R10 million (Ten million Rand). The material terms of the agreement are as follows:
• The loan is repayable 6 months after the date of the advancement of the loan (which is 18 December 2023).
• The loan is subject to an interest rate of 0.15% (zero point one five per cent) of the monthly revenue invoiced from MFP 1.
• Should the loan not be repaid in 6 months, a penalty interest rate of 2 times the prime overdraft rate charged by First National
Bank will apply to the default period.
• The Company will pay a minimum of 0.5% (zero point five per cent) interest on the loan amount during the period before MFP
1 goes into full production.
• Commencing on the day after the repayment of the loan amount the company shall pay Diaruk a monthly commission of
0.15% (zero point one five per cent) on all the revenue invoiced from MFP 1 for a period of 20 years payable monthly in
arrears. The commission is payable as a fee for arranging the debt finance under Diaruk loan agreement.
Effective Date
The effective date is 21 December 2023.
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1.3 DARMANE INVESTMENTS (PTY) LIMITED LOAN AGREEMENT
On 19 December 2023 the Company entered into a loan agreement with Darmane Investments (Pty) Limited ("Darmane"), registration
number 2004/019989/07, a company incorporated in accordance with the laws of the Republic of South Africa whereby Darmane will
lend the Company R30 million (Thirty million Rand). The material terms of the agreement are as follows:
• On the Effective Date Darmane will advance R20 000 000 (twenty million Rand) of the loan amount to the Company and within
10 days following the Effective date Darmane will advance a further R10 000 000 (ten million Rand) of the loan amount to the
Company.
• The Company shall pay Darmane a facility and administration fee of R300 000 (three hundred thousand Rand) plus VAT which
becomes due on the Effective Date and shall be capitalised to the amount due under the loan facility.
• The loan is repayable 6 months after the date of the advancement of the loan which is 19 December 2023.
• The loan is subject to an interest rate of 0,45% (zero point forty-five per cent) of the monthly revenue invoiced from MFP 1.
• Should the loan not be repaid in 6 months, a penalty interest rate of 2 times the prime overdraft rate charged by First National
Bank will apply to the default period.
• Commencing on the day after the repayment of the loan amount the company shall pay Darmane a commission of 0.45% (zero
point forty-five per cent) on the revenue invoiced from MFP 1 for a period of 20 years payable monthly in arrears. The
commission is payable as a fee for arranging the debt finance under Diaruk loan agreement.
Effective Date
The effective date is 22 December 2023.
Related Party
Marcel Golding a director of Copper 360 is also a director of Darmane and therefore considered a related party to the transaction. As a
result, a Fairness opinion on the commercial terms of the agreement will be obtained and will be available for inspection as set out in 6
below.
1.4 HIGH WEST CAPITAL PARTNERS LLC LOAN AGREEMENT
On 21 November 2023 the Company entered into a loan agreement with High West Capital Partners LLC ("High West") a private
investment firm, whereby High West will lend the Company up to 50% of the current fair market value of 37?720 000 shares of the
Company (approximately R75 million (Seventy five million Rand)). The material terms of the agreement are as follows:
• High West may in its sole discretion but in consultation with Copper 360 notify the Company of its intention to fund a particular
tranche. This communication will be in writing. Such notification will include the principal amount of the tranche and the intended
closing date of the tranche.
• The advance of any additional tranche shall be conditional on there not existing any default event or uncured valuation event.
• The loan to value ratio and the number of shares shall be mutually agreed on by the parties on each and every subsequent
tranche.
• All outstanding amounts of the loan under all tranches shall bear interest in an amount equal to 6.75% (six point seventy-five per
cent) per annum payable in quarterly instalments.
• The loan will be collateralised by the deposit into escrow of 37 720 000 Copper 360 shares by the founding shareholders (SA
Hayes, R Smith, JP Nelson and LAS du Plessis) in terms of scrip lending agreements on normal arm's length commercial terms
with Copper 360. Should any of the collateralised shares be forfeited to High West, the Company will issue the same number of
shares to the founding shareholders as the number of shares forfeited.
High West has issued a notice of intention to fund an initial tranche of approximately R58.9 million (fifty eight point nine million Rand),
subject to the Condition Precedent below.
Condition Precedent
Before the loan is advanced to Copper 360 the Company must obtain the necessary approval and consent from the Financial Surveillance
Department of the South African Reserve Bank in respect of the loan including the repayment of the loan amount, together with the
interest accrued thereon. Application has been made to First National Bank as Authorised Dealer in Foreign Currency in this regard.
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2. SHARE SUBSCRIPTION FACILITY AGREEMENT
2.1 INTRODUCTION AND INTENDED USE OF FUNDS
On 14 December 2023 ("Signature Date"), Copper 360 entered into a share subscription facility agreement with unrelated third
parties, GEM Global Yield LLC SCS ("the Investor") and GEM Yield Bahamas Limited ("GYBL") ("Agreement").
In terms of the Agreement, the Investor will make available to Copper 360 a share subscription facility of up to a maximum of
R650 million ("the Facility") pursuant to which Copper 360 will (i) be entitled to draw down from the Facility against the issuance to
the Investor of ordinary shares in Copper 360 ("Ordinary Shares") ("Consideration Shares"); (ii) issue 55 million warrants to the
Investor ("Warrants") to subscribe for up to 55 million Ordinary Shares ("Warrant Shares"); (iii) pay GYBL a commitment fee
in an amount of R13 million, which fee will be payable in cash or Ordinary Shares ("Commitment Fee Shares"), or a combination of
both ("Proposed Transaction").
For the avoidance of doubt, the Facility is not a debt facility as there are no repayment obligations on Copper 360. Rather, it is a
commitment by the Investor to subscribe for equity in Copper 360 of up to a maximum value of R650 million against the delivery of
subscription notices by Copper 360 to the Investor, and the issue of Consideration Shares to the Investor by Copper 360 during the
"Commitment Period", being the period of three years from the Signature Date ("Execution Date"), such that Copper 360 controls
the timing and amount of any draw down under the Facility.
The proceeds of the subscription monies from the issue of the Consideration Shares and the Warrants will be used by Copper 360
primarily for working capital and capital expenditure purposes. The Warrant Payment Shares and the Commitment Fee Shares will
be issued to settle the payment and the Fee as set out in paragraphs 2.2.15 and 2.2.19, respectively, as the case may be.
2.2 THE TRANSACTION
2.2.1 Nature of the Investor and GYBL
Global Emerging Markets ("GEM") is a $3.4 billion, alternative investment group with operations in Paris, New York, and
Bahamas. GEM manages a diverse set of investment vehicles focused on emerging markets and has completed over 575
transactions in 70 countries. Each investment vehicle has a different degree of operational control, risk-adjusted return,
and liquidity profile. The investment vehicles provide GEM and its partners with exposure to: Small- Mid Cap Management
Buyouts, Private Investments in Public Equities and select venture investments.
For more information: http://www.gemny.com.
2.2.2 Summary of terms of the Proposed TransactionConsideration
Shares
2.2.2.1 From time to time, and on any day on which Ordinary Shares trade on the exchange operated by the JSE Limited ("JSE")
("Trading Days") during the Commitment Period, Copper 360 will be entitled, subject to certain conditions (including but
not limited to those set out in paragraph 2.3 below) having been and remaining satisfied, to deliver a subscription notice to
the Investor to subscribe for Consideration Shares ("Subscription Notice"). Each Subscription Notice will specify the price
below which the Company does not wish to issue the Consideration Shares ("Floor Price") and the aggregate number of
Consideration Shares that the Company wishes the Investor to subscribe for ("Draw Down Amount").
2.2.2.2 The Investor will (i) be obliged, with respect to the Subscription Notice and the "Pricing Period", being a period of 15
consecutive Trading Days following the date of delivery of the Subscription Notice ("Notice Date"), to subscribe for such
number of Consideration Shares which is at least 50% of the "Pricing Period Obligation", being a number of Consideration
Shares equal to the Draw Down Amount divided by 15 and multiplied by the number of Trading Days during the Pricing
Period which is not a "Knockout Day", asdetailed in paragraph 2.2.3 below; and (ii) be entitled, at its sole discretion, to elect
to subscribe for up to 200% of the Pricing Period Obligation.
2.2.2.3 The Subscription Price will be 90% of the average closing bid prices during a Pricing Period, excluding any 'Knockout Day",
being any Trading Day during a Pricing Period on which (i) the amount equal to 90% of the closing bid price is less than the
applicable Floor Price; or (ii) the Ordinary Shares are not traded on the JSE or trading thereon is suspended for more than
one hour; or (b) in respect of which the Investor elects to treat a Trading Day on which a material adverse event has occurred
as a Knockout Day.
2.2.2.4 On the first Trading Date following each Pricing Period, the Investor will deliver to the Company a notice stating the exact
number of Consideration Shares for which it wishes to subscribe and the applicable subscription price ("Closing Notice"),
subject to amaximum aggregate amount of R650 million in respect of all prior Closing Notices.
2.2.2.5 The number of Consideration Shares to be subscribed for by the Investor on a Closing Date will be referred to as the "Issue
Amount", which cannot be less than 50% of the Pricing Period Obligation.
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2.2.2.6 ill
In terms of the Agreement, "Share Providers", being the founding shareholders of Copper 360, w be notified by the
Company by no later than five Trading Days prior to the delivery of a Subscription Notice, of its intention to deliver a
Subscription Notice ("Intention Notification") specifying the proposed Draw Down Amount and date of delivery of the
applicable Subscription Notice ("Notice Day").
2.2.2.7 The Share Providers shall be deemed, upon receipt of any Intention Notification, to offer ("Offer") to provide Ordinary Shares
to the Investor on the following terms:
(a) the total number of Ordinary Shares ("Provided Shares") which will be offered will be equal to the Draw Down
Amount;
(b) the Investor will be deemed to accept the full amount of the Provided Shares unless it has notified the Share
Providers by no later than three Trading Days prior to the Notice Date of a lesser amount; and
(c) the Share Providers will deliver the Provided Shares which are to be provided ("Share Provision") to the settlement
system account of the Investor prior to the Notice Date.
2.2.2.8 In the event that the Company does not proceed to issue a Subscription Notice following the Intention Notification, on the
Notice Date or within three Trading Days thereafter, the Offer will be terminated, and the Investor will, at the cost of the
Share Providers, procure the return of any Provided Shares which have been delivered to the Investor's settlementsystem
account to the relevant Share Providers.
2.2.2.9 Where the number of Provided Shares that have been transferred to the Investor by the Share Providers in connection with
a Subscription Notice is greater than the Issue Amount specified in the corresponding Closing Notice, the Investor will
transfer to the Share Providers such number of Ordinary Shares equal to the number by which the Provided Shares exceeds
the Issue Amount by no later than the first Business Day following the Closing Date.
2.2.2.10 On acceptance of an Offer, the Investor will be deemed, in consideration of the provision of the Provided Shares, to assign
to the Share Providers its right to receive such number of Consideration Shares issued pursuant to the relevant Subscription
Notice as is equal to the lesser of the Issue Amount and the number of Provided Shares so that the Company shall issue such
number of Ordinary Shares direct to the Share Providers in accordance with paragraph 2.2.13 below.
2.2.2.11 If the Issue Amount set out under the applicable Closing Notice is greater than the Provided Shares delivered according to
the respective Subscription Notice, the Companywill procure that the Share Providers deliver to the Investor's settlement
system account additional Ordinary Shares up to the Issue Amount and in the amount required ("Additional Provided
Shares") to cover any difference between the applicable Provided Shares and the Issue Amount.
2.2.2.12 On acceptance of the Additional Provided Shares, the Investor will be deemed, inconsideration of the Additional Provided
Shares, to assign to the Share Providers its rightto receive such number of Consideration Shares issued pursuant to the
relevant Closing Notice as is equal to the number of Additional Provided Shares delivered, so that the Company shall issue
such number of Ordinary Shares direct to the Share Providers in accordance with paragraph 2.2.13 below.
2.2.2.13 Within twelve months of any Closing Date, the Company will issue to the Investor, by crediting the account designated by
the Investor, such number of Consideration Shares subscribed for by the Investor on the relevant Closing Date, save that the
Company will book the requisite number of Ordinary Shares to the account/s designated by the Share Providers to whom
the Investor has assigned the rights in connection with the Provided Shares.
2.2.2.14 The first subscription notice will be for a maximum amount of R85 million.
Warrants
2.2.2.15 The delivery of a Subscription Notice to the Investor will be subject to Copper 360 having issued Warrants to subscribe for
55 million Ordinary shares to the Investor within 45 trading days of the Execution Date ("Warrant Delivery D ate"). Such
Warrants are exercisable at any time and from time to time until the third anniversary of the date on which they are issued,
at an exercise price of R5.50 per Ordinary Share ("Exercise Price"), subject to certain adjustments as set out in the
Agreement, as the case may be. However, if on the first anniversary of the Warrant Delivery Date, the current market price
of the Ordinary Shares is less than 90% of the Exercise Price, the Exercise Price shall be a sum equal to 105% of such current
market price.
2.2.2.16 Regardless of whether there is a subscription for or issue of Consideration Shares under the Agreement, if the Warrants are
not issued and delivered by the Warrant Delivery Date, the Company will pay the Investor a cash payment equal to the Black
Scholes Value of any unissued Warrants as calculated by the Investor on a Trading Day during the three year term of the
Warrant ("Warrants Payment"). The Warrants Payment may be payable in cash or in unrestricted Ordinary Shares ("Warrant
Payment Shares"), or a combination of both. In order to calculate the number of Warrants Payment Shares to be delivered
by the Company to the Investor, the shares will be valued at 90% of the volume weighted average price for the 15
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Trading Days immediately prior to the Warrant Delivery Date.
2.2.2.17 Notwithstanding the aforegoing, the Investor agrees not to exercise the Warrants such that the Investor will be issued with
Ordinary Shares in excess of 10% of the Ordinary Shares then in issue until such time that the Company has obtained the
requisite regulatory and shareholder approvals.
2.2.2.18 The Warrants may be assigned without Copper 360's written consent, subject to applicable regulatory and other approvals.
2.2.2.19 In terms of its obligations to deliver Warrant Shares to the persons in whose names the Warrants are registered ("Holders"),
Copper 360 will be entitled to agree that a third party lends Ordinary Shares to the Holder for delivery on the "Relevant
Effective Date", being the date on which the Holder delivers a notice to the Company of the Holder's election to exercise
the Warrant, or, if later, the date on which the exercise price is received by the Company.
Fee
2.2.2.20 At the Execution Date, Copper 360 will be liable to pay GYBL a commitment fee equal to 2% of the Facility, being R13 million
("the Fee"), which will be discharged by the Company providing 3 862 151 Ordinary Shares to GYBL.
2.2.3 Conditions precedent to the delivery of a Subscription Notice
The delivery of a Subscription Notice by Copper 360 to the Investor will be subject to:
• the Ordinary Shares remaining listed;
• the Warrants having been issued in favour of and a warrant certificate in respect thereof having been delivered
to the Investor;
• the Company having nominated, by written notice to the Investor, person/s who shall have adhered to and remain
bound by the terms of the Agreement as Share Provider/s pursuant to a deed of adherence;
• the Company having sufficient authorised capital to satisfy the Subscription Notice;
• the Share Providers having delivered the Ordinary Shares to which the Subscription Notice relates in electronic
form into the Investor's brokerage account;
• the requisite regulatory and shareholder approvals having been obtained;
• all representations and warranties of Copper 360 and the Share Providers as contained in the Agreement having
remained true and correct as at the Notice Date;
• no material adverse event having occurred or being reasonably expected to occur at thatpoint in time;
• no material change in ownership of Copper 360 having occurred;
• in respect of Copper 360 and its subsidiaries, no inquiry, investigation or other proceeding having commenced,
been announced or threatened, nor any order having been issued by any governmental or regulatory
organisation or stock exchange, or any change in law that would hinder the implementation of the Agreement;
• no event having occurred giving rise to the Investor's termination rights under the Agreement;
• the issuance of Ordinary Shares to the Investor not resulting in the Investor holding more than 29.9% of the
outstanding share capital of the Company, excluding any Warrants;
• if the Subscription Notice is issued on or after the One Year Anniversary, Copper 360 having paid the Fee in full, or
if the Subscription Notice is issued before the One Year Anniversary, Copper 360 having deposited, and there
remaining in escrow, with an escrowagent, either (i) a cash amount sufficient to pay the balance of the Fee in full;
(ii) Commitment Fee Shares, the aggregate value of which, when valued at 90% of the prevailing market price at
the time of issuance of the Subscription Notice, is at least equal to the balance of the Fee; or (iii) a combination
of cash and Commitment Fee Shares (valued at 90% of the prevailing market price at the time of issuance of the
Subscription Notice) which is sufficient to pay the balance of the Fee in full.
2.2.4 Obligations of Copper 360
Copper 360 is obliged, within 45 trading days of the Execution Date, to obtain the requisite shareholder approvals to issue
the Warrants, the Commitment Fee Shares and the Warrant Payment Shares, as the case may be.
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3. IRREVOCABLE LETTERS OF UNDERTAKING
At the date of this announcement, the Company has obtained irrevocable undertakings from shareholders who will be entitled to
vote on the resolutions to issue the Warrants, the Commitment Fee Shares, and the Warrant Payment Shares, as the case may be,
at a general meeting to be convened pursuant to the notice of general meeting to be included in the circular referred to in paragraph
4 below ("General Meeting"), holding or representing a total of 441 462 783 Ordinary Shares, equivalent to 70.1% of all Ordinary
Shares eligible for voting.
All such shareholders or representatives have indicated that they will vote in favour of the Proposed Transaction, to the extent that
they are permitted to do so under the JSE Listings Requirements.
Shareholder Number of shares Percentage shareholding
SA Hayes 365 231 429 58.0%
R Smith 27 363 922 4.3%
LAS du Plessis* 13 147 624 2.1%
JP Nelson* 11 508 936 1.8%
Orontro Investments (Pty) Ltd 11 175 761 1.8%
Thabiso Botha Resources (Pty) Ltd 10 500 000 1.7%
GV Thompson 1 524 751 0.2%
Renovo Metals (Pty) Ltd 1 010 360 0.2%
* Including holdings through corporate entities under their control
4. FURTHER DOCUMENTATION
The issue of the Warrants, the Commitment Fee Shares, and the Warrant Payment Shares, as the case may be, each constitute, in
terms of the JSE Listings Requirements, a specific issue of shares for cash and will be subject to, inter alia, the approval thereof by at
least 75% of the votes of Copper 360 shareholders, being cast in favour of such resolutions. Accordingly, a circular to shareholders
incorporating details of the proposed resolutions and a notice to convene the General Meeting will be distributed to shareholders
in due course.
5. RATIONALE FOR ADDITIONAL CAPITAL
The capital raised by way of loans and equity will (a) fund the acquisition of Nama Copper which enables the company to double the
production in the 2025FY and (b) accelerate the expansion of Rietberg Mine that will see the production double again by 2026 FY.
The capital has been structured through several financial instruments resulting in minimum dilution to shareholders and maximum
flexibility to the Company in terms of repayment term and ability and balance sheet stability and margin. Having the balance sheet fully
funded with some additional cash ensures delivery risk is mitigated and unforeseen events funded. This comes at very minimal dilution
to shareholders and positions the Company for success.
6. FAIRNESS OPINION
In terms of section 10 of the Listings Requirements, the loans from HMC and Darmane are deemed small related party transactions
and accordingly, the board of directors of the Company ("Board") is required to provide the JSE with written confirmation prepared in
accordance with Schedule 5 thereof ("Fairness Opinion"), obtained from an independent professional expert acceptable to the JSE,
confirming that the terms of the Proposed Transaction are fair insofar as shareholders are concerned.
In compliance with section 10 of the Listings Requirements, Bridge Capital Advisors Proprietary Limited has been appointed as the
independent professional expert to provide it with the Fairness Opinion. The Fairness Opinion will be submitted to the JSE for review,
whereafter it will lie for inspection at Copper 360's registered office, 1 Main Road, Nababeep, Northern Cape and will be made available
on request from the Company Secretary by emailing micel@copper360.co.za, for a period of 28 days from the date of
issue. Shareholders will be kept informed in this regard.
7. PRO FORMA FINANCIAL EFFECTS OF THE SPECIFIC ISSUE OF WARRANTS AND COMMITMENT FEE SHARES
The table below sets out the pro forma financial effects of the issue of the Warrants and the Commitment Fee Shares to assist
Shareholders in assessing the impact of the issue of the Warrants and the Commitment Fee Shares on, inter alia, the earnings per
Share, headline earnings per Share, diluted earnings per Share, diluted headline earnings per Share, net asset value per Share and
tangible net asset value per Share ("Pro Forma Financial Information"). The consolidated Pro Forma Financial Information, including
the assumptions on which it is based and the financial information from which it has been prepared, is the responsibility of the Board.
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The consolidated pro forma financial information has been prepared using accounting policies that comply with IFRS and that are
consistent with those applied in the unaudited interim consolidated results of Copper 360 for the six month period ended 31 August
2023. The Pro forma Financial Information has been prepared for illustrative purposes only, based on current information available to
management of Copper 360, in order to provide information about the financial results and position of Copper 360. Due to its nature,
the Pro forma Financial Information may not fairly present Copper 360's financial position, changes in equity and results of operations
or cash flows after the impact of the Proposed Transaction and are calculated on the assumptions set out below based on the
Company's published unaudited interim consolidated financial results for the six month period ending 31 August 2023:
a. All Warrants were exercised on 1 March 2023;
b. The Commitment Fee Shares were issued on 1 March 2023;
c. The proceeds of the Warrant exercise (R302.5 million) were invested in an interest-bearing deposit at an interest rate of 9% per
year;
d. The corporate tax rate was 27%; and
e. The Commitment Fee expense (R13 million) was offset against the stated capital account.
Amounts in R'000 except per share data in Actual Pro forma Percentage Change
cents
Profit/(loss) attributable to owners (4 955) 4 982 +201%
Weighted average shares in issue 629 692 119 688 554 270 +9%
Earnings/(loss) per share (cents) (0.79) 0.72 +192%
Headline earnings/(loss) per share (cents) (0.79) 0.72 +192%
Net asset value 1 849 766 2 139 166 +16%
Tangible net asset value 501 825 791 325 +58%
Net asset value per share (cents) 294 311 +6%
Tangible net asset value per share (cents) 80 115 +44%
Copper 360's published interim results to 31 August 2023 did not disclose fully diluted EPS or HEPS in terms of the prohibition on
disclosing a reduced loss per share on a fully diluted basis in terms of IAS33. As a consequence, no fully diluted effects are presented.
The pro forma financial effects presented in the table above have not been audited or reviewed by Copper 360's auditors.
21 December 2023
Stellenbosch
CONTACT: Micel Wilson (micel@copper360.co.za)
Designated Advisor: Bridge Capital Advisors Proprietary Limited
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Date: 21-12-2023 11:15:00
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