ABX GROUP LIMITED - Capital/Financing Update 2021

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Australian Bauxite Limited t/a ABX Group ACN 139 494 885

OPTIONS PROSPECTUS

November 2021

Entitlement Offer

For a non-renounceable offer of one (1) SPP Option (exercisable at $0.20 on or before 31 May 2023) for every one (1) Share subscribed for and issued to Eligible Shareholders who participated under the Company’s recent Share Purchase Plan ( Entitlement Offer ).

This Entitlement Offer is made only to and is only being sent to Eligible Shareholders who participated in the SPP.

The issue of the SPP Options is subject to Shareholder approval at a forthcoming General Meeting of shareholders.

Cleansing Offer

This Prospectus also includes a cleansing offer for Placement Options ( Cleansing Offer ) to remove any trading restrictions on the sale of Placement Options issued prior to the Closing Date.

The Offers close at 5.00pm Sydney Time on 8 December 2021 (which date may change without notice).

This Prospectus is not to be distributed outside Australia and New Zealand.

THIS DOCUMENT IS IMPORTANT AND SHOULD BE READ IN ITS ENTIRETY

If you do not understand its contents, you should consult your stockbroker, accountant or other professional adviser without delay.

The SPP Options offered under this Prospectus and shares issued upon exercise of SPP Options are considered speculative.

ABx Group Options Prospectus

CORPORATE DIRECTORY

Issuer

Australian Bauxite Limited t/a ABX Group ACN 139 494 885 Level 5 52 Phillip Street Sydney NSW 2000 p: +61 2 9251 7177 f: +61 2 9251 7500 e: [email protected] w: www.abxgroup.com.au

Directors

Paul Lennon AO (Non-Executive Chairman) Ken Boundy (Non-Executive Director Ian Levy (Managing Director and CEO)

Company Secretary

Henry Kinstlinger Chief Financial Officer Francis Choy

ASX Code ABX

Share Registry*

The Registrar Computershare Investor Services Pty Limited Yarra Falls, 452 Johnston Street Abbotsford VIC 3067 (Melbourne) p: +61 (3) 9415 4000 and 1300 850 505

Auditors*

K.S. Black & Co Level 6, 350 Kent Street Sydney NSW 2000

This entity is included for information purposes only and has not been involved in the preparation of this Prospectus.

Any questions concerning the Entitlement Offer should be directed to the ABx Group Secretary on +61 2 9251 7177.

IMPORTANT NOTE

This Prospectus is dated 11 November 2021. A copy of the Prospectus was lodged with the Australian Securities & Investments Commission (“ASIC”) on the same date. Neither the ASIC nor ASX Limited (“ASX”) nor their respective officers take any responsibility as to the contents of the Prospectus.

This Prospectus contains and applies to the offer of SPP Options.

You should read this document carefully before you make a decision to apply for SPP Options. An investment in ABx Group has risks, which you should consider before making a decision to invest. The SPP Options offered under this Prospectus and shares issued upon exercise of SPP Options should be considered speculative.

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ABx Group Options Prospectus

Key dates for investors
Lodgement of Prospectus	11 November 2021
Prospectus despatched to eligible shareholders Opening Date of Entitlement Offer and Cleansing Offer	17 November 2021
Last date to receive Entitlement Forms from Eligible Shareholders who do not wish to participate in the Entitlement Offer Closing date of Entitlement Offer and Cleansing Offer*	8 December 2021
General Meeting date to approve issue of SPP Options	16 December 2021
Anticipated issue date	23 December 2021

The above dates should be regarded as indicative only* . Subject to the Corporations Act 2001 (Cth), the ASX Listing Rules and other applicable laws, ABx Group reserves the right to change the above dates, to close the Entitlement Offer before the date stated above, to extend the Closing Date and subsequent dates, or not to proceed with the Entitlement Offer.

Important Information

This is an important document which should be read in its entirety before making any investment decision. You should obtain independent advice if you have any questions about any of the matters contained in this Prospectus.

This Prospectus is dated 11 November 2021 and was lodged with the ASIC on that date with the consent of all Directors. Neither ASIC nor ASX nor their respective officers take any responsibility for the contents of this Prospectus.

Expiry Date

No SPP Options will be issued on the basis of this Prospectus any later than 13 months after the date of this Prospectus (being the expiry date of this Prospectus).

Prospectus Availability

A copy of this Prospectus is available for inspection at the registered office of the Company at Level 5, 52 Phillip Street, Sydney NSW 2000 during normal business hours.

The Prospectus will be made available in electronic form. Persons having received a copy of this Prospectus in its electronic form may obtain an additional paper copy of this Prospectus (free of charge) from the Company’s registered office by contacting the Company.

Entitlement Offer Conditional

The issue of the SPP Options is subject to Shareholder approval at a forthcoming General Meeting of shareholders.

The Company will not apply for Official Quotation by ASX for any of the SPP Options offered under this Prospectus.

Offer Speculative

The SPP Options offered by this Prospectus should be considered speculative. Please refer to Section 3 for details relating to investment risks.

Disclaimer

No person is authorised to give any information or to make any representation in connection with the Entitlement Offers which is not contained in this Prospectus. Any information or representation not so contained may not be relied on as having been authorised by the Company in connection with the Entitlement Offer.

This document is important and should be read in its entirety before deciding to participate in the Entitlement Offers. This does not take into account the investment objectives, financial or taxation, or particular needs of any Applicant. Before making any investment in the Company, each Applicant should consider whether such an investment is appropriate to his/her particular

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ABx Group Options Prospectus

needs, and considering their individual risk profile for speculative investments, investment objectives and individual financial circumstances. Each Applicant should consult his/her stockbroker, solicitor, accountant or other professional adviser without delay. Some of the risk factors that should be considered by potential investors are outlined in Section 3. Definitions of certain terms used in this Prospectus are contained in Section 12. All references to currency are to Australian dollars and all references to time are to Sydney Time unless otherwise indicated.

Geographic Restrictions

No action has been taken to permit the offer of SPP Options under this Prospectus in any jurisdiction other than Australia and New Zealand.

Transaction Specific Prospectus

This Prospectus is a transaction specific prospectus for an offer of continuously quoted securities (as defined in the Corporations Act) and has been prepared in accordance with section 713 of the Corporations Act. It does not contain the same level of disclosure as an initial public offering prospectus. In making representations in this Prospectus regard has been had to the fact that the Company is a disclosing entity for the purposes of the Corporations Act and certain matters may reasonably be expected to be known to investors and professional advisers whom potential investors may consult.

No Exposure Period

The Options Issue is made pursuant to ASIC Corporations (Exposure Period) Instrument 016/74 which exempts the Company from complying with section 727(3) of the Corporations Act to the extent that that section prohibits the Company from issuing Options in the seven calendar day period after the date of lodgement of this Prospectus with ASIC.

On-sale of Shares

This Prospectus has been prepared in respect of the offer of the Options such that the relief provided under ASIC Corporations (Sale Offers That Do Not Need Disclosure) Instrument 2016/80 with respect to the on-sale provisions of section 707 of the Corporations Act is available.

Specifically, if the Options are issued with disclosure under this Prospectus, then any Shares issued upon the exercise of the Options can be on-sold within 12 months of their issue (even if the Shares were issued without disclosure or lodgement of a cleansing statement). This is because the Options are issued with disclosure and the exercise of the Option does not involve any further offer.

Risk factors

Potential investors should be aware that subscribing for and holding Securities in the Company involves a number of risks. The key risk factors of which investors should be aware are set out in Section 3 of this Prospectus. These risks together with other general risks applicable to all investments in listed companies not specifically referred to, may affect the value of the Securities in the future. Accordingly, an investment in the Company should be considered highly speculative. Investors should consider consulting their professional advisers before deciding whether to apply for Securities.

Overseas Investors

This Prospectus does not constitute an offer or invitation in any place in which, or to any person to whom, it would not be lawful to make such an offer or invitation. The distribution of this Prospectus in jurisdictions outside Australia and New Zealand may be restricted by law. Persons who come into possession of this Prospectus should seek advice on and observe any such restrictions. Any failure to comply with such restrictions may constitute a violation of applicable securities laws. Lodgement of a duly completed Entitlement Form will be taken by the Company to constitute a representation that there has been no breach of such laws.

No action has been taken to register or qualify the SPP Options, or the Entitlement Offer, or otherwise to permit an Entitlement Offering of the SPP Options, in any jurisdiction outside Australia and New Zealand.

The Entitlement Offer pursuant to an Electronic Prospectus is only available to persons receiving an electronic version of this Prospectus within Australia and New Zealand.

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ABx Group Options Prospectus

New Zealand

The Entitlement Offer to New Zealand investors is a regulated offer made under Australian and New Zealand law. In Australia, this is Chapter 8 of the Corporations Act and the Corporations Regulations 2001. In New Zealand, this is Part 5 of the Securities Act 1978 and the Securities (Mutual Recognition of Securities Offerings – Australia) Regulations 2008. The Entitlement Offer and the content of the Prospectus are principally governed by Australian rather than New Zealand law.

In the main, the Corporations Act sets out how the Entitlement Offer must be made. There are differences in how securities are regulated under Australian law. The rights, remedies, and compensation arrangements available to New

Zealand investors in Australian securities may differ from the rights, remedies, and compensation arrangements for New Zealand securities. Both the Australian and New Zealand securities regulators have enforcement responsibilities in relation to the Entitlement Offer.

If you need to make a complaint about the Entitlement Offer, please contact the Financial Markets Authority, Wellington, New Zealand. The Australian and New Zealand regulators will work together to settle your complaint. Please note that the taxation treatment of Australian securities is not the same as for New Zealand securities.

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ABx Group Options Prospectus

1.	About ABx Group .................................................................................................................... 13
2.	The Offers ............................................................................................................................... 13
3.	Risk Factors ............................................................................................................................ 18
4.	Effect of the Entitlement Offer .............................................................................................. 24
5.	Application Instructions ......................................................................................................... 26
6.	Further Information ............................................................................................................... 26
7.	Terms of Options Offered ...................................................................................................... 30
8.	Directors’ Interests ................................................................................................................. 34
9.	Other Information .................................................................................................................. 36
10.	Consents ................................................................................................................................. 38
11.	Directors’ Authorisation Statement ....................................................................................... 38
12.	Glossary .................................................................................................................................. 39

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ABx Group Options Prospectus

Letter from the Chairman

Dear Shareholder

On behalf of the Directors, I am pleased to offer you the opportunity to participate in this Entitlement Offer for SPP Options. The Entitlement Offer is made to participants of the Company's recent share purchase plan ( SPP ) as a sign of goodwill from the Company for assisting the Company during its recent SPP capital raising.

Why is the Company offering SPP Options to SPP Participants?

The SPP follows ABX Group’s successful institutional placement announced on 24 May 2021 of 32,500,000 Shares at $0.10 per Share with attaching options on a 1 for 1 basis, exercisable at $0.20 before 31 May 2023 ( Placement ) which raised $3.25 million before costs of the Placement.

The purpose of this Prospectus is to extend the offer of additional options to the participants in the SPP on the same terms as the Placement options were offered to participants of the Placement ( SPP Options ).

By offering the Options under a Prospectus, any Shares issued on exercise of the Options will be able to be on-sold immediately (should you so choose) without the need for such on-sale to be made under a disclosure document or without the need for the Company to issue a 'cleansing statement' under Part 6D.2 of the Corporations Act.

The SPP Options have a nil issue price and will be exercisable at $0.20 each and exercisable on or before 31 May 2023. The full terms and conditions of the SPP Options are set out in Section 7 of this Prospectus.

Eligible Shareholders will be deemed to have accepted their respective Entitlement if the Company does not receive notice to the contrary prior to the Closing Date in response to an Entitlement Form accompanying this Prospectus. Accordingly, an Eligible Shareholder does not need to do anything to accept the Entitlement Offer applicable to them.

The issue of the SPP Options is subject to Shareholder approval at a forthcoming General Meeting of Shareholders.

It is important that Shareholders read this Prospectus in its entirety and seek professional advice where necessary.

The SPP Options offered by this Prospectus should be considered speculative. Please refer to Section 3 for details relating to investment risks.

Enquiries relating to this Prospectus should be directed to the Company Secretary by telephone on +61 2 9251 7177 or mobile +61 (0) 418 613 028.

If you have any general shareholder enquiries, please call the share registry, Computershare, on 1300 850 505 (within Australia) or +61 3 9415 4000 (outside Australia) at any time from 8:30 am to 5:00 pm (Sydney Time) Monday to Friday.

Thank you for your continued support of ABX Group.

Yours sincerely

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Paul Lennon Chairman

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ABx Group Options Prospectus

Investment Overview

Please read and consider this Prospectus in full in conjunction with any specific matters which have or may be referred to in ABx Group’s ASX announcements before making any decision regarding applying for SPP Options, exercising options or investment in ABx Group. In particular, the risks described in Section 3 include risk areas considered specific to ABx Group:


Key Information	Further Information


Transaction Specific Prospectus This Prospectus is a transaction specific prospectus for offers of SPP Options to acquire continuously quoted securities (as defined in the Corporations Act) and has been prepared in accordance with section 713 of the Corporations Act. It does not contain the same level of disclosure as an initial public offering prospectus. In making representations in this Prospectus regard has been had to the fact that the Company is a disclosing entity for the purposes of the Corporations Act and certain matters may reasonably be expected to be known to investors and professional advisers whom potential investors may consult.	Section 6.2


Risk Factors Potential investors and Shareholders should be aware that the issue of the SPP Options in the Company involves a number of risks. The key risk factors of which investors should be aware are set out in Section 3, including (but not limited to) risks in respect of: General Economic Conditions:Changes in the general economic climate in which the Company operates or holds investments in may adversely affect the financial performance of the Company. Factors that may contribute to that economic climate include the general level of economic activity, interest rates, currency fluctuations, inflation, supply and demand, industrial disruption, changes in investor sentiment, infectious diseases, terrorism or other hostilities and other economic factors. These factors are beyond the control of the Company and the Company cannot, with any degree of certainty, predict how they will impact on the Company. The COVID-19 pandemic has negatively affected global economies and is likely to continue to negatively affect global economies for an undetermined period of time. COVID-19 Risk:The outbreak of the COVID-19 is impacting global economic markets. The full nature and extent of the effect of the outbreak on the performance of the Company remains unknown. The Company’s Share price may be adversely affected in the short to medium term by the economic uncertainty caused by COVID-19. Further, any governmental or industry measures taken in response to COVID-19 may adversely impact the Company’s operations and are likely to be beyond the control of the Company. The Company's ability to freely move people and equipment to and from exploration projects may be curtailed which may cause delays or cost increases. The effects of COVID-19 on the Company's Share price may also impede the Company's ability to raise capital, or require the Company to issue capital at a discount, which may in turn cause dilution to Shareholders.	Section 3

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ABx Group Options Prospectus

Taxation implications: The Directors do not consider it appropriate to give Shareholders advice regarding the taxation consequences of subscribing for the SPP Options. However, investors are cautioned that the subscription of convertible securities such as the SPP Options may give rise to adverse taxation consequences. As a result, Shareholders should consult their professional tax adviser in connection with subscribing for SPP Options, and in particular, tax advisers should be made aware that there is a possibility that the exercise price of the SPP Options may be lower than Company's underlying share price at the time of issue.

The Company, its advisers and its officers do not accept any responsibility or liability for any such taxation consequences to Shareholders.

Exercise Price of SPP Options: If SPP Options are exercised, there is no guarantee that Shares issued on exercise of those SPP Options will trade above the exercise price paid for those Shares.

Exploration Success: Mining exploration and development is a high-risk undertaking. The success of the Company depends on the delineation of economically minable reserves and resources, access to required development capital, movement in the price of commodities, securing and maintaining title to the Company's exploration and mining tenements and obtaining all consents and approvals necessary for the conduct of its exploration activities. Exploration of the Company’s projects may be unsuccessful, resulting in a reduction of the value of those projects and diminution in the cash reserves of the Company.

Future Capital Requirements: The Company may have difficulty in obtaining future equity or debt funding to support exploration programs, evaluation and development of its tenements. The Company's ability to raise further equity or debt, or to divest part of its interest in a tenement, and the terms of such transactions will vary according to a number of factors, including the success of exploration results and the future development of the tenements, stock market conditions and prices for commodities. Additional financing may not be available on terms acceptable to the Company, or at all.

Entitlement Offer

Section 4

Pursuant to the SPP Options Entitlement Offer under this Prospectus, the Company offers, for nil cash consideration, up to 40,786,500 SPP Options exercisable at $0.20 and exercisable on or before 31 May 2023, on the basis of one (1) Free-Attaching SPP Option for every one (1) Share subscribed for by Eligible Shareholders under the SPP.

No funds will be raised as a result of the Entitlement Offer.

Eligible Participants

Section 2.1

The Entitlement Offer is made only to SPP Participants who participated in the SPP.

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ABx Group Options Prospectus

Use of Funds

Section 2.1

Nil funds will be raised as a result of the Entitlement Offer.

The Company will receive $0.20 for each SPP Option exercised. If all SPP Options are issued and exercised, the Company will receive approximately $8,157,300. There is no certainty that any SPP Options will be exercised and the proportion exercised will depend on the Share price relative to the exercise price during the exercise period. It is currently intended that any funds raised by the exercise of the SPP Options will be used towards continued development on the Company's existing projects and for working capital.

Use of Funds Nil funds will be raised as a result of the Entitlement Offer. The Company will receive $0.20 for each SPP Option exercised. If all SPP Options are issued and exercised, the Company will receive approximately $8,157,300. There is no certainty that any SPP Options will be exercised and the proportion exercised will depend on the Share price relative to the exercise price during the exercise period. It is currently intended that any funds raised by the exercise of the SPP Options will be used towards continued development on the Company's existing projects and for working capital.	Use of Funds Nil funds will be raised as a result of the Entitlement Offer. The Company will receive $0.20 for each SPP Option exercised. If all SPP Options are issued and exercised, the Company will receive approximately $8,157,300. There is no certainty that any SPP Options will be exercised and the proportion exercised will depend on the Share price relative to the exercise price during the exercise period. It is currently intended that any funds raised by the exercise of the SPP Options will be used towards continued development on the Company's existing projects and for working capital.	Use of Funds Nil funds will be raised as a result of the Entitlement Offer. The Company will receive $0.20 for each SPP Option exercised. If all SPP Options are issued and exercised, the Company will receive approximately $8,157,300. There is no certainty that any SPP Options will be exercised and the proportion exercised will depend on the Share price relative to the exercise price during the exercise period. It is currently intended that any funds raised by the exercise of the SPP Options will be used towards continued development on the Company's existing projects and for working capital.	Section 2.1

Indicative Capital Structure Assuming that no existing SPP Options are exercised before the date of this Prospectus, the effect of the Entitlement Offer on the Company’s issued capital as at the date of this Prospectus is as shown in the following table: Shares SPP Options Balance at the date of this Prospectus 223,590,814 38,034,000 Maximum to be issued pursuant to the Entitlement Offer Nil 40,786,500 Total on issue post Entitlement Offer 223,590,814 78,820,500			Section 4.2
	Shares	SPP Options
Balance at the date of this Prospectus	223,590,814	38,034,000
Maximum to be issued pursuant to the Entitlement Offer	Nil	40,786,500
Total on issue post Entitlement Offer	223,590,814	78,820,500


Directors' participation and interests			Section 8

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ABx Group Options Prospectus

Forward Looking Statements

Important Information

This Prospectus contains forward-looking statements which are identified by words such as 'may', 'could', 'believes', 'estimates', 'targets', 'expects', 'anticipates' or 'intends' and other similar words that involve risks and uncertainties.

These statements are based on an assessment of present economic and operating conditions, and on a number of assumptions regarding future events and actions that, as at the date of this Prospectus, are considered reasonable.

Such forward-looking statements are not guarantees of future performance and involve known and unknown risks, uncertainties, assumptions and other important factors, many of which are beyond the control of the Company, the Directors and the management.

The Directors cannot and do not give any assurance that the results, performance or achievements expressed or implied by the forward-looking statements contained in this Prospectus will actually occur and investors are cautioned not to place undue reliance on these forward-looking statements.

The Directors have no intention to update or revise forward-looking statements, or to publish prospective financial information in the future, regardless of whether new information, future events or any other factors affect the information contained in this Prospectus, except where required by law.

These forward looking statements are subject to various risk factors that could cause the Company's actual results to differ materially from the results expressed or anticipated in these statements. The risk factors are in Section 3.

What is my SPP Entitlement?	Section 2.1
The number of SPP Options for which you are entitled to apply and receive is
set out on your Entitlement Form accompanying this Prospectus.
If you choose to accept your Entitlement to SPP Options under the Entitlement
Offer, you must accept your Entitlement in full.
Is the SPP Entitlement conditional?	Section 2.7
The issue of the SPP Options is subject to Shareholder approval at a forthcoming
General Meeting of shareholders.
What is the Cleansing Offer?	Section 2.3
The purpose of the Cleansing Offer is to facilitate the secondary trading of the
Placement Options (defined in Section 12).
Is the offer underwritten?	Section 2.5
No, the Entitlement Offer is not underwritten.

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ABx Group Options Prospectus

How do I accept my Entitlement?

Section 5 and the Entitlement Form

Detailed instructions on how to accept the Entitlement are set out in Section 5.

If you choose not to accept your Entitlement under the Entitlement Offer then your Entitlement will lapse at the Closing Date.

Is there a minimum subscription amount?

Section 2.1

There is no minimum subscription amount.

If the Cleansing Offer is not fully subscribed, ABx Group will pay the balance of the costs of the Offers from existing funds.

What are the tax implications of participating in the Entitlement Offer?

Section 9.2

Taxation implications will vary depending upon your specific circumstances.

You should obtain your own professional advice as to the particular taxation treatment that will apply to you.

How and when will I know if my application was successful?

Section 6

A holding statement confirming the issue of your SPP Options will be sent to you on or about 23 December 2021*.

Anyone who trades SPP Options or shares issued upon exercise of SPP Options before receiving a holding statement does so at their own risk.

Where can I find more information about ABx Group?

Section 1

For more information on ABx Group and its projects please see ABx Group's website (www.abxgroup.com.au) and ABx Group's ASX announcements (also available on ABx Group's website, and on the ASX's website, www.asx.com.au).

What if I have any questions about the Entitlement Offer?

Section 9.9

You should consult your stockbroker, accountant, solicitor or other professional adviser before making any decision regarding applying for SPP Options, exercising options or investment in ABx Group.

Questions concerning the Entitlement Offer can also be directed to ABx Group Secretary, Henry Kinstlinger, on +61 2 9251 7177.

All dates are subject to change without notice – see the timetable on page 3 for the anticipated timetable for the Entitlement Offer and further information about dates.

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ABx Group Options Prospectus

1. About ABx Group

Alcore aluminium fluoride

In 2020, ABx Group’s 87%-owned subsidiary Alcore Limited succeeded in producing aluminium fluoride samples consistent with commercial grades of aluminium fluoride used in aluminium smelters, without which, the smelters cannot operate. There is no substitute.

In 2021, Alcore achieved a world first by producing aluminium fluoride from smelter waste products, which not only increases profitability but will provide security of supply of this critically important ingredient for Australasian aluminium smelters, whilst continuing to improve their environmental excellence. Australia is the only major aluminium producer without an aluminium fluoride plant and has relied on imports, mainly from China, which have decreased by more than 60% in 2021.

Operating margins for a 60,000 tonnes aluminium fluoride plant are estimated to be in the order of $50 million per annum at current prices of aluminium fluoride and projected operating costs, supplying Australasian smelters and exporting to several known smelters.

Alcore plans to build its plant in Bell Bay, Tasmania and, once in production, Alcore can expand into advanced technologies including lithium ion batteries, high purity alumina, HF acid and fluorine gas.

Rare earth elements (REE) discovery

In 2021, ABx Group confirmed its discovery of potentially ore grade rare earth elements (REE) at its Deloraine bauxite project in northern Tasmania. This discovery is ideal for ABx because it is:

Rich in super-magnet rare earth metals, especially “neodymium” which is the main component of super magnets that are essential strategic metals for electric vehicles, wind turbines, modern smart phones and military devices but are in short supply;
“Water soluble” ionic clay type of REE which can be developed quickly at low cost;
Shallow depth, typically 6 to 16 metres from surface; and,
Free of radioactive elements thorium and uranium so it can be processed in any country.

ABx shares are one of only three exchange-listed opportunities globally for this ionic clay type of REE which have hitherto been a major contributor to China’s 86% control of the REE markets. Market capitalisations of ABx’s peer group companies in the REE exploration sector exceed $100 million.

New bauxite mine developments

ABx Group has completed rehabilitation of its Bald Hill mine in northern Tasmania to better than premining land value which is ABx’s paramount policy. ABx’s rehabilitation technology is a core strength.

ABx Group is moving to the nearby Fingal Rail project which is larger and better quality bauxite. ABx is keen to deliver Fingal Rail bauxite into two contracts by late 2021, early 2022. Fingal Rail can grow to deliver larger revenues for ABx than Bald Hill’s $0.5 to $2 million EBITDA in past years.

ABx Group’s mining lease application for the Sunrise Bauxite Project is on the large Binjour deposit located 115km west of Bundaberg Port in QLD. ABx is finalising transnational legal arrangements for the 50:50 joint venture with Rawmin Mining of India which is funding the project and provides ABx with technologies to meet customer specifications and for large-scale shipping of bauxite.

2. The Offers

2.1 The Entitlement Offer

As announced on 1[st] October 2021, the Company has recently undertaken a Share Purchase Plan ( SPP ). As set out in the SPP, Eligible Shareholders that took up their rights under the SPP were entitled to participate in an offer of one (1) SPP Option for every one (1) Share subscribed for and issued under the SPP. The

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ABx Group Options Prospectus

Entitlement Offer therefore is open to the Company’s Shareholders who participated in the SPP ( Eligible Shareholders ).

Australian Bauxite Limited ( Company or ABx Group ) is offering up to 40,786,500 options exercisable at 20 cents ($0.20) and expiring on 31 May 2023 each to acquire one (1) fully paid ordinary share of ABx Group upon exercise ( SPP Options ), for nil consideration.

40,786,500 Shares from 443 Shareholders were applied for and issued under the SPP, meaning that approximately 40,786,500 SPP Options will be issued under the Entitlement Offer, subject to rounding.

The SPP Options are offered only to SPP Participants who receive a personalised Entitlement Form.

There is no minimum subscription amount.

No funds will be raised from the issue of SPP Options pursuant to the Entitlement Offer.

All of the SPP Options offered under this Prospectus will be issued on the terms and conditions set out in Section 7 of this Prospectus.

All of the Shares issued upon the future exercise of the SPP Options offered under this Prospectus will rank equally with the Shares on issue at the date of this Prospectus. Please refer to Section 7.9 of this Prospectus.

SPP Entitlement

The number of SPP Options for which you are entitled to apply and receive is set out on your Entitlement Form accompanying this Prospectus.

No payment is required to take up your Entitlement.

Entitlements are non-renounceable. Accordingly, there will be no trading of rights on the ASX and you will be unable to transfer your Entitlement to another party.

If you choose to accept your Entitlement to SPP Options under the Entitlement Offer, you must accept your Entitlement in full.

Accepting the Entitlement

Detailed instructions on how to accept your Entitlement are set out in Section 5 below.

If you choose not to accept your Entitlement under the Entitlement Offer then your Entitlement will lapse at the Closing Date.

Reasons to apply for SPP Options

The SPP Options, if applied for, will be issued for nil consideration. There are no brokerage fees or other costs payable by Eligible Shareholders to acquire SPP Options. It is noted that in order to be entitled to these SPP Options, Eligible Shareholders paid $0.10 for each Share subscribed for in the SPP.

There is no obligation to apply for or exercise any of the SPP Options that you are entitled to. However, Eligible Shareholders should note that they will be deemed to have accepted their respective Entitlement if the Company does not receive notice to the contrary prior to the Closing Date in response to an Entitlement Form accompanying this Prospectus.

Eligible Shareholders should seek and rely on their own taxation advice regarding the exercise of SPP Options as the taxation consequences will depend on the particular circumstances of the individual.

2.2 Placement

The Company conducted a successful institutional placement in May 2021 of 32,500,000 Shares at $0.10 per Placement Share with attaching options on a 1 for 1 basis, exercisable at $0.20 before 31 May 2023 ( Placement Options ) which raised $3.25 million before costs of the Placement ( Placement ).

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ABx Group Options Prospectus

5,534,000 Placement Options were issued to advisors CPS Capital Group Pty Ltd (or their nominees) ( CPS Capital ) who acted as lead managers to the Placement.

A total of $3,250,000 (before costs) was raised in the Placement.

Other than to CPS Capital, the Placement Options were issued as free-attaching to Placement Shares and as issued (38,034,000 Placement Options in total). The Placement Options have the same terms as the SPP Options, which are set out in full in Section 7.

Shareholders approved the issue of the Placement Options at the Company’s AGM held on 14 July 2021.

2.3 Cleansing Offer

Under this Prospectus, the Company invites investors identified by the Directors to apply for up to 1,000 options at a nil issue price ( Cleansing Offer ).

The Cleansing Offer may only be extended to specific parties on invitation from the Company. Application Forms will only be provided by the Company to such parties.

All of the Placement Options offered under this Prospectus will rank equally with options on issue at the date of this Prospectus. Please refer to Section 7 for further information regarding the rights and liabilities attaching to the Options.

The primary purpose of the Cleansing Offer is to remove any trading restrictions that may have attached to Placement Options issued by the Company without disclosure under Chapter 6D of the Corporations Act prior to the Closing Date (including prior to the date of this Prospectus).

The Directors do not expect to issue any options under the Cleansing Offer.

2.4 Opening and Closing Dates

The Company will accept Entitlement Forms or Application Forms pursuant to the Cleansing Offer from the opening date 17 November 2021 until 8 December 2021 or such other date as the Directors in their absolute discretion shall determine, subject to the requirements of the Listing Rules. The Company reserves the right to make amendments to the indicative timetable without providing notice, including closing the Offers early.

2.5 Underwriting

The Entitlement Offer is not underwritten.

2.6 Minimum Subscription

There is no minimum subscription.

2.7 Conditional Offer

The Entitlement Offer is conditional upon the Company obtaining Shareholder approval to issue the SPP Options at a General Meeting of Shareholders to be held on 16 December 2021. If Shareholder approval is not obtained for the issue of the SPP Options, no SPP Options will be issued.

2.8 Effect on Control

The Company is of the view that the Entitlement Offer will not affect the control (as defined by section 50AA of the Corporations Act) of the Company. No investor or existing Shareholder will have a voting power greater than 20% as a result of the completion of the Entitlement Offer.

2.9 No ASX Listing

The Company does not currently propose to apply to the ASX for quotation of the SPP Options offered under this Prospectus. ASX takes no responsibility for the contents of this Prospectus.

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ABx Group Options Prospectus

2.10 Issue

SPP Options issued pursuant to the Entitlement Offer will be issued in accordance with the ASX Listing Rules and timetable set out on page 3 of this Prospectus.

Holding statements for SPP Options issued under the Entitlement Offer will be mailed in accordance with the ASX Listing Rules and timetable set out on page 3 of this Prospectus as soon as practicable after their issue.

The Company will apply for any Shares issued on exercise of the SPP Options and Placement Options to be quoted on ASX.

2.11 CHESS

The Company participates in the Clearing House Electronic Sub-register System, known as CHESS. ASX Settlement Pty Limited, a wholly owned subsidiary of ASX, operates CHESS in accordance with the Listing Rules and the ASX Settlement Operating Rules.

Under CHESS, Shareholders will not receive a certificate but will receive a statement of their holding of SPP Options.

If you are broker sponsored, ASX Settlement Pty Limited will send you a CHESS statement.

The CHESS statement will specify the number of SPP Options issued to you under this Prospectus, provide details of your holder identification number and the participant identification number of the sponsor.

If you are registered on the Issuer Sponsored sub-register, your statement will be despatched by the Share Registry and will contain the number of SPP Options issued to you under this Prospectus and your security holder reference number.

A CHESS statement or Issuer Sponsored statement will routinely be sent to Shareholders at the end of any calendar month during which the balance of their Shareholding changes.

Shareholders may request a statement at any other time; however, a charge may be made for additional statements.

2.12 Overseas SPP Participants

This Prospectus does not, and is not intended to, constitute an offer of SPP Options in any jurisdiction in which it would be unlawful. In particular, this Prospectus may not be distributed to any person, and the SPP Options may not be offered or sold, in any country outside Australia where it would be unlawful to do so.

It was not practicable for the Company to comply with securities laws of overseas jurisdictions in relation to the SPP. The Company formed this view having considered:

(a) the number of overseas SPP Participants;
(b) the number and value of the securities under the SPP that would be offered to those overseas SPP Participants; and
(c) the cost of complying with the legal requirements and the requirements of regulatory authorities in the overseas jurisdictions.

Therefore, the SPP was only extended to those Shareholders residing in Australia or New Zealand.

Accordingly, the Entitlement Offer is not being extended, and SPP Options will not be issued to, Shareholders with a registered address which is outside of Australia or New Zealand.

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ABx Group Options Prospectus

2.13 Notice to nominees and custodians

Nominees and custodians that hold Shares should note that the Entitlement Offer is available only to SPP Participants. The Company is not required to determine whether or not any registered holder is acting as a nominee or the identity or residence of any beneficial owners of Shares. If any nominee or custodian is acting on behalf of a foreign person, that holder, in dealing with its beneficiary, will need to assess whether indirect participation by the beneficiary in the Entitlement Offer is compatible with applicable foreign laws.

2.14 Risk factors

An investment in the SPP Options should be regarded as speculative. In addition to the general risks applicable to all investments in listed securities, there are certain specific risks associated with an investment in the Company which are detailed in Section 3.

2.15 Taxation implications

The Directors do not consider it appropriate to give Shareholders advice regarding the taxation consequences of subscribing for the SPP Options. The Company, its advisers and its officers do not accept any responsibility or liability for any such taxation consequences to Shareholders. As a result, Shareholders should consult their professional tax adviser in connection with subscribing for SPP Options, and in particular, tax advisers should be made aware that there is a possibility that the exercise price of the SPP Options may be lower than the Company's underlying share price at the time of issue, which may give rise to taxation liabilities for subscribers.

2.16 Major activities and financial information

A summary of the major activities and financial information relating to the Company, for the financial year ended 31 December 2020, can be found in the Company's Annual Report announced on ASX on 31 March 2021. The Company's continuous disclosure notices (i.e. ASX announcements) since 31 March 2021 are listed in Section 6.3. Copies of these documents are available free of charge from the Company. The Directors strongly recommend that Shareholders review these and all other announcements.

2.17 Privacy

If you complete an application for SPP Options, you will be providing personal information to the Company (directly or by the Share Registry). The Company collects, holds and will use that information to assess the Application, service your needs as a Security holder, facilitate distribution payments and corporate communications to you as a Security holder, and carry out administration.

The information may also be used from time to time and disclosed to persons inspecting the register, bidders for your Securities in the context of takeovers, regulatory bodies, including the Australian Taxation Office, authorised securities brokers, print service providers, mail houses and the Share Registry.

By submitting an Entitlement Form, each Applicant agrees that the Company may use the information provided by an Applicant on the Entitlement Form for the purposes set out in this privacy disclosure statement and may disclose it for those purposes to the Share Registry, the Company's related bodies corporate, agents, contractors and third party service providers, including mailing houses and professional advisers, and to ASX and regulatory authorities.

If you do not provide the information required on the Entitlement Form, the Company may not be able to accept or process your Application.

An Applicant has an entitlement to gain access to the information that the Company holds about that person subject to certain exemptions under law. A fee may be charged for access. Access requests must be made in writing to the Company's registered office.

Collection, maintenance and disclosure of certain personal information is governed by legislation including the Privacy Act 1988 (Cth) (as amended), the Corporations Act and certain rules such as the ASX Settlement Operating Rules.

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2.18 Enquiries concerning Prospectus

Enquiries relating to this Prospectus should be directed to the Company Secretary by telephone on +61 2 9251 7177 or on mobile + 61 (0) 418 613 028.

For general shareholder enquiries, please contact the Share Registry on 1300 850 505 (within Australia) or +61 3 9415 4000 (outside Australia) at any time from 8:30 am to 5:00 pm (Sydney Time) Monday to Friday.

3. Risk Factors

3.1 Introduction

The SPP Options offered under this Prospectus are considered speculative. Potential investors should consider the potential risks associated with ABx Group’s business and risks associated with an investment in SPP Options and ABx Group. The following risk factors may affect the future operating and financial performance of ABx Group, the value of its securities and its future funding requirements. Some of these risk factors may be able to be mitigated by appropriate commercial action. However, many are outside the control of ABx Group and are dependent on policies adopted or approaches taken by regulatory authorities or otherwise cannot be mitigated. In addition these risks and uncertainties are not the only risks facing ABx Group.

Additional risks and uncertainties including those not presently known to ABx Group, or that it currently believes to be immaterial may also affect its business operations.

There can be no guarantee that ABx Group will meet trading performance or financial results guidance that it may provide to the market, or that any forward looking statements contained in this Prospectus will be realised or otherwise eventuate. Investors should note that past performance is not always a reliable indicator of future performance.

As an Applicant, you should satisfy yourself that you have a sufficient understanding of these matters and should consider whether SPP Options are a suitable investment for you, having regard to your own investment objectives, financial circumstances and taxation position. If you do not understand any part of this Prospectus or are in any doubt as to whether to apply for SPP Options or not, it is recommended that you seek professional guidance from your solicitor, accountant or other independent and qualified professional adviser before deciding to apply.

3.2 Risks specific to the SPP Options Entitlement Offer

(a) Exercise price of SPP Options: If the SPP Options are exercised, there is no guarantee that Shares issued on exercise of those SPP Options will trade above the exercise price paid for those Shares.
(b) Dilution: If you do not exercise the SPP Options, because you allow those SPP Options to expire without being exercised, or you do not receive SPP Options because you are an Excluded Holder, and other Shareholders exercise their SPP Options, your shareholding will be diluted.

3.3 Risks specific to the Company

(a) Coronavirus (COVID-19) Risk

The outbreak of COVID-19 is impacting global economic markets.

The full nature and extent of the effect of the outbreak on the performance of the Company remains unknown.

The Company’s Share price may be adversely affected in the short to medium term by the economic uncertainty caused by COVID-19. Further, any governmental or industry measures taken in response to COVID-19 may adversely impact the Company’s operations and are likely to be beyond the control of the

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ABx Group Options Prospectus

Company. The Company's ability to freely move people and equipment to and from exploration projects may be constrained by these measures which may cause delays or cost increases. The effects of COVID-19 on the Company's Share price may also impede the Company's ability to raise capital or require the Company to issue capital at a discount, which may in turn cause dilution to Shareholders.

(b) Exploration Risk

Mining exploration and development is a high-risk undertaking. The success of the Company depends on the delineation of economically minable reserves and resources, access to required development capital, movement in the price of commodities, securing and maintaining title to the Company's exploration and mining tenements and obtaining all consents and approvals necessary for the conduct of its exploration activities.

Exploration of the Company’s projects may be unsuccessful, resulting in a reduction of the value of those projects, diminution in the cash reserves of the Company. The exploration costs of the Company are based on certain assumptions with respect to the method and timing of exploration. By their nature, these estimates and assumptions are subject to significant uncertainties and, accordingly, the actual costs may materially differ from these estimates and assumptions. Accordingly, no assurance can be given that cost estimates and underlying assumptions will be realised in practice, which may materially and adversely affect the Company’s viability.

(c) Future Capital Requirements

The Company may have difficulty in obtaining future equity or debt funding to support exploration programs, evaluation and development of its tenements. Further finance will be required to extend the Company's current drilling program.

The Company's ability to raise further equity or debt, or to divest all or part of its interest in a tenement, and the terms of such transactions, will vary according to a number of factors, including the success of exploration results and the future development of the tenements, stock market conditions and prices for commodities.

Should it subsequently be established that a mining production operation is technically, environmentally and economically viable, the Company will require additional financing to establish mining operations and production facilities. The Company may not be able to raise the additional finances that may be required for future activities. Commodity prices, environmental regulations, environmental rehabilitation or restitution obligations, revenues, taxes, transportation costs, capital expenditures, operating expenses and technical aspects are all factors which will impact on the amount of additional capital that may be required.

Additional financing may not be available on terms acceptable to the Company, or at all. Significantly, any additional equity financing or the exercising of SPP Options, may dilute your existing shareholdings; and debt financing, if available, may restrict financing and future activities. If the Company fails to obtain additional financing, as needed, it may have to reduce the scope of its operations or anticipated expansion of its operations, forfeit its interest in some or all of its tenements, incur financial penalties and/ or reduce or terminate its operations.

(d) Taxation Implications

The Directors do not consider it appropriate to give Shareholders advice regarding the taxation consequences of subscribing for the SPP Options. However, investors are cautioned that the subscription of convertible securities such as the SPP Options may give rise to adverse taxation consequences. As a result, Shareholders should consult their professional tax adviser in connection with subscribing for SPP Options, and in particular, tax advisers should be made aware that there is a possibility that the exercise price of the SPP Options may be lower than Company's underlying share price at the time of issue.

The Company, its advisers and its officers do not accept any responsibility or liability for any such taxation consequences to Shareholders.

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ABx Group Options Prospectus

(e) Regulatory Risks

The Company will incur ongoing costs and obligations associated with compliance with necessary regulations. Regulatory areas which are of particular significance to the Company include environmental compliance and rehabilitation, mining, taxation, employee relations, worker health and safety, waste disposal, protection of the environment, native title and heritage matters, protection of endangered and protected species, social licence obligations, bribery, corruption and other matters. The Company requires permits from regulatory authorities to authorise the Company’s operations. These permits relate to exploration, development, production and rehabilitation activities. Any failure to comply with regulations may result in additional costs for corrective measures, penalties or restrictions on the Company's proposed business operations. In addition, changes in regulations could require extensive changes to the Company's operations, increased compliance costs or give rise to material liabilities, which could have a material adverse effect on the business, results of operations and financial condition of the Company.

(f) Tenure, Access and Grant of Applications

The Company’s operations are subject to receiving and maintaining licences and permits from appropriate governmental authorities. There is no assurance that delays will not occur in connection with obtaining all necessary grants or renewals of licences/permits for the proposed operations, additional licences/permits for any possible future changes to operations, or additional permits associated with new legislation. Prior to any development on any of its properties, subsidiaries of the Company must receive licences/permits from appropriate governmental authorities. There is no certainty that the Company will hold all licences/permits necessary to develop or continue operating at any particular property.

(g) Environmental Risk

Mining and exploration has become subject to increasing environmental responsibility and liability in Australia. The potential for liability is an ''ever present" risk. The use and disposal of chemicals and other materials in the mining industry is under constant legislative scrutiny and regulation. Consistent with this, the Company may be required, in some cases, to undertake baseline environmental studies prior to certain exploration or mining activities, so that the environmental impact can be monitored and, as far as possible, minimised. The discovery of any endangered species of fauna and flora may impact upon the Company's ability to freely explore or develop its tenements.

There is no guarantee that nature reserves or parks will not be decreed by government agencies in the areas in which the Company works. These could constrain the Company's ability to operate on its existing or future licences.

(h) Social Licence

In order to explore, develop or operate in communities, the general acceptance of certain stakeholder populations may be required. This may include formal agreements that can require extended negotiations with large numbers of stakeholders, for example indigenous communities and groups with native title rights. There can be no guarantee these negotiations will be concluded successfully or not be protracted and cause significant delay to the Company's plans.

(i) Mine Development Risk

Possible future development of a mining operation at any of the Company’s future projects is dependent on a number of factors including, but not limited to, delineation of economically recoverable mineralisation, favourable geological conditions, receiving the necessary approvals from all relevant authorities and parties, seasonal weather patterns, climate change, unanticipated technical and operational difficulties encountered in extraction and production activities, mechanical failure of operating plant and equipment, shortages or increases in the price of consumables, spare parts and plant and equipment, cost overruns, access to the required level of funding and contracting risk from third parties providing essential services.

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ABx Group Options Prospectus

(j) Insurance Risks

There are significant exploration and operating risks associated with exploration including adverse weather conditions, environmental risks and fire, all of which can result in injury to persons as well as damage to or destruction of the extraction plant, equipment, production facilities and other property. In addition, the Company and its subsidiaries will be subject to liability for environmental risks such as pollution and damage of the environment. The occurrences of a significant event against which the Company is not fully insured could have a material adverse effect on its operations and financial performance. In addition, in the future some or all of the Company’s insurance coverage may become unavailable or prohibitively expensive.

(k) Ability to Exploit Successful Discoveries

Even if an apparently viable deposit is identified, there is no guarantee that the Company can economically exploit it. That is, it may not always be possible for the Company to participate in the exploitation of successful discoveries made in any areas in which it has an interest because such exploitation may require further intensive capital input as well as further licences, mining concessions and clearances from relevant authorities. The Company notes that it may or may not be possible for such conditions to be satisfied.

(l) Loss of Key Management Personnel

The Company's success largely depends upon key management personnel for the management of the Company as well as upon other management and technical personnel for the daily operation of the Company. Consequently, there is a possibility that the Company will be adversely affected, particularly in respect of the rate at which its exploration programs and tenements are developed or prioritised, if one or more of the key management personnel cease their employment.

(m) Exploration Costs

The exploration costs of the Company are premised upon a number of assumptions and estimates as regards the method and timing of exploration. These assumptions and estimates are, by their nature, speculative and subject to a number of uncertainties. Consequently, the Company does not give any assurance that the cost estimates and the underlying assumptions will be realised in practice, which may adversely affect the Company's budget and forecast cashflows and ultimately the trading price of its Securities.

(n) Commodity Prices

Commodity prices are influenced by physical and investment demand for those commodities. Fluctuations in commodity prices may influence individual projects in which the Company has an interest as well as the Company's ability to raise capital.

(o) Tax Rules

Tax rules or their interpretation in relation to equity investments may change. In particular, both the level and basis of taxation may change. In addition, an investment in the Shares and the grant of SPP Options involves tax considerations that may differ for each Shareholder. There could be a variety of taxation consequences for Shareholders in relation to the grant of SPP Options including adverse consequences. Each Shareholder is encouraged to seek professional tax advice in connection with any investment and in relation to the grant of SPP Options in the Company particularly given the current share price of the Company as against the exercise price of the SPP Options.

Tax law is complex and is subject to regular change. Changes in tax law, including various proposed but as yet not enacted changes in tax law may adversely impact the Company’s future financial performance and position.

Resulting changes in tax arrangements may adversely impact the Company’s future financial performance and position. In addition, future changes to other laws and regulations or accounting standards, which

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ABx Group Options Prospectus

apply to the Company from time to time, could materially adversely affect the Company’s future financial performance and position.

(p) Litigation Risks

The Company is exposed to possible litigation risks including contractual disputes, occupational health and safety claims and employee claims. Further, the Company may be involved in disputes with other parties in the future which may result in litigation. Any such claim or dispute if proven, may impact adversely on the Company’s operations, financial performance and financial position.

(q) Competition Risk

The industry in which the Company is involved is subject to domestic and global competition. Although the Company will undertake all reasonable due diligence in its business decisions and operations, it will have no influence or control over the activities or actions of its competitors, which activities or actions may positively or negatively affect the operating and financial performance of the Company's business.

(r) Force Majeure

The Company, now or in the future may be adversely affected by risks outside the control of the Company including labour unrest, civil disorder, war, subversive activities or sabotage, extreme weather conditions, fires, floods, explosions or other catastrophes, epidemics or quarantine restrictions.

(s) Land Access Risk

Land access is critical for exploration and/or exploitation to succeed. It requires both access to the mineral rights and access to the surface rights.

Minerals rights may be negotiated and acquired. In all cases the acquisition of prospective exploration and mining licences is a competitive business, in which proprietary knowledge or information is critical and the ability to negotiate satisfactory commercial arrangements with other parties is often essential. The Company may not be successful in acquiring or obtaining the necessary licences to conduct exploration or evaluation activities outside of the mineral tenements that it already owns.

Access to land for exploration and evaluation purposes can be obtained by: private access and compensation agreement with the landowner; purchase of surface rights; or through judicial rulings. However, access rights to the licences can be affected by many factors including:

(a) travel restrictions, quarantining procedures or other impediments to the free movement of personnel as a result of COVID-19;
(b) surface title land ownership negotiations, which are required before ground disturbing exploration activities can commence within the jurisdiction where the Company operates;
(c) permitting for exploration activities, which are required in order to undertake most exploration and exploitation activities within the jurisdictions where the Company operates;
(d) social licence to operate (refer to Social Licence Risks in Section3.3(h)); and
(e) natural occurrences including inclement weather, floods and earthquakes.

All of these issues have the potential to delay, curtail and preclude the Company's operations. Whilst the Company will have the potential to influence some of these access issues, and retains staff to manage those instances where negotiations are required to gain access, is not possible for the Company to predict the extent to which the above-mentioned risks and uncertainties may adversely impact on the Company's operations.

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ABx Group Options Prospectus

(t) Going Concern Risk

The Company's ability to raise further capital within an acceptable time, of a sufficient amount and on terms acceptable to the Company will vary according to a number of factors, prospectivity of projects (existing and future), the results of exploration, subsequent feasibility studies, development and mining, share market and industry conditions and the price of relevant commodities and exchange rates.

If adequate funds are not available on acceptable terms the Company may not be able to develop its projects and it may impact on the Company's ability to continue as a going concern.

3.4 General Risks

The future prospects of the Company's business may be affected by circumstances and external factors beyond the Company's control. Financial performance of the Company may be affected by a number of business risks that apply to companies generally and may include economic, financial, market or regulatory conditions.

(a) General Economic Conditions

Changes in the general economic climate in which the Company operates or holds investments in may adversely affect the financial performance of the Company. Factors that may contribute to that economic climate include the general level of economic activity, interest rates, currency fluctuations, inflation, supply and demand, industrial disruption, changes in investor sentiment, infectious diseases, terrorism or other hostilities and other economic factors. These factors are beyond the control of the Company and the Company cannot, with any degree of certainty, predict how they will impact on the Company. COVID-19 has negatively affected global economies and is likely to continue to negatively affect global economies for an undetermined period of time.

(b) Economic Risks

General economic conditions, movements in commodity prices, interest and inflation rates may have an adverse effect on the Company’s activities, as well as on its ability to fund those activities.

Further, share market conditions may affect the value of the Company’s securities regardless of the Company’s operating performance. Share market conditions are affected by many factors such as:

(a) general economic outlook;
(b) interest rates and inflation rates;
(c) currency fluctuations;
(d) changes in investor sentiment toward particular market sectors (such as the exploration industry or the base metals sector within that industry);
(e) the demand for, and supply of, capital; and
(f) terrorism or other hostilities.

(c) Security Risk

The business of the Company may be materially impacted by breaches of security, on-site or via technology, either by unauthorised access, theft, destruction, loss of information or release of confidential data. The Company's security measures may not be sufficient to detect or prevent such breaches of security.

(d) Coronavirus Disease Risk

The outbreak of COVID-19 is having a material effect on global economic markets. The global economic outlook is facing uncertainty due to the pandemic, which has had and may continue to have a significant impact on capital markets and share prices.

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ABx Group Options Prospectus

The Company’s Share price may be adversely affected by the economic uncertainty caused by COVID-19. Further, any measures to limit the transmission of the virus implemented by governments around the world (such as travel bans and quarantining) may adversely impact the Company’s operations.

In the event that COVID-19 negatively impacts the Company's ability to attract further capital, the Company intends to mitigate this by adjusting its working capital position and evaluating funding positions.

(e) Climate Change Risk

Climate change is a risk the Company has considered, particularly related to its operations in the mining industry. The climate change risks particularly attributable to the Company include:

(a) the emergence of new or expanded regulations associated with the transitioning to a lowercarbon economy and market changes related to climate change mitigation. The Company may be impacted by changes to local or international compliance regulations related to climate change mitigation efforts, or by specific taxation or penalties for carbon emissions or environmental damage. These examples sit amongst an array of possible restraints on industry that may further impact the Company and its profitability. While the Company will endeavour to manage these risks and limit any consequential impacts, there can be no guarantee that the Company will not be impacted by these occurrences; and
(b) climate change may cause certain physical and environmental risks that cannot be predicted by the Company, including events such as increased severity of weather patterns and incidence of extreme weather events and longer-term physical risks such as shifting climate patterns. All these risks associated with climate change may significantly change the industry in which the Company operates.

3.5 Investment Speculative

The above list of risk factors ought not to be taken as exhaustive of the risks faced by the Company or by Shareholders in the Company. The above factors, and others not specifically referred to above, may in the future materially affect the financial performance of the Company and the value of the SPP Options offered under this Prospectus.

Therefore, the SPP Options to be issued pursuant to this Prospectus carry no guarantee with respect to the payment of dividends, returns of capital or the market value of those SPP Options.

Shareholders should consider that their investment in the Company is speculative and should consult their professional advisers for further advice.

4. Effect of the Entitlement Offer

4.1 Purpose of the Entitlement Offer

The purpose of the Entitlement Offer was to incentivise Eligible Shareholders to participate in the SPP, as set out in the terms and conditions of the SPP.

The purpose of the Entitlement Offer is to issue up to 40,786,500 SPP Options on the basis of 1 FreeAttaching SPP Option for every 1 Share subscribed for under the SPP.

No funds will be raised through the issue of the SPP Options pursuant to this Prospectus, however if all SPP Options are subscribed for and exercised, the Company will receive approximately $8,157,300.

This Prospectus has also been issued to facilitate secondary trading of the Shares to be issued upon exercise of the SPP Options to be issued under the Entitlement Offer. Issuing the SPP Options under this Prospectus will enable persons who are issued the SPP Options to on-sell the Shares issued on exercise of the SPP Options pursuant to ASIC Corporations (Sale Entitlement Offers That Do Not Need Disclosure) Instrument 2016/80.

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ABx Group Options Prospectus

Funds received from the exercise of options will be applied to ABx Group’s working capital requirements at the time of exercise. There is no guarantee that SPP Options will be exercised at any particular time or at all.

4.2 Capital Structure

Capital Structure prior to the Issue
Shares	223,590,814
Placement Options (exercise price of $0.20 with an expiry date of 31 May 2023	38,034,000
Number of Securities to be issued pursuant to this Prospectus
Shares	Nil
SPP Options offered under this Prospectus (maximum)	40,786,500
Capital structure following completion of the Issue
Shares	223,590,814
Options	78,820,500

Shares if SPP Options Exercised
Existing Shares	223,590,814
Number of shares to be issued if SPP Options offered under this Prospectus and all existing Placement Options are exercised in full before expiry	78,820,500
Total ^	302,411,314

^ Assumes the Entitlement Offer is fully subscribed, no further shares issued and no other options exercised before exercise of the SPP Options. There is no guarantee that SPP Options will be exercised at any particular time or at all.

The directors do not expect any options are expected to be issued under the Cleansing Offer.

(a) Dilution

Existing proportional interests of Shareholders in the issued shares of ABx Group will not be diluted through the issue of SPP Options.

Existing proportional interests of Shareholders in the issued shares of ABx Group will be diluted if SPP Options are exercised. Examples of the impact of dilution on existing share holdings where SPP Options are exercised are set out below, assuming the Entitlement Offer is fully subscribed, no further shares issued and no other options exercised before exercise of the SPP Options. There is no guarantee that SPP Options will be exercised at any particular time or at all. It is further assumed that the notional Shareholders in the example below does not acquire or dispose of shares and does not exercise any existing options it might hold, and that the shareholder is not a recipient of SPP Options.

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ABx Group Options Prospectus

Shareholder (example)	Share holding at the Date of lodgement of this Prospectus	Existing %	As % of total Shares on issue assuming exercise of all options on issue
A	10,000	0.0045%	0.0033%
B	50,000	0.0224%	0.0165%
C	100,000	0.0447%	0.0331%
D	500,000	0.2236%	0.1653%
E	1,000,000	0.4472%	0.3307%
F	5,000,000	2.2362%	1.6534%

(b) Substantial Shareholders

As at the date of this Prospectus there are no major shareholders (>5%) of ABx Group.

(c) Directors and Other Related Parties

Directors or other related parties of ABx Group that participated in the SPP will be invited to apply for SPP Options. The issue of SPP Options to directors or related parties will be subject to Shareholder approval at the General Meeting. The issue of SPP Options will not affect the current direct and indirect holdings of Directors or other related parties of ABx Group. The proportionate effect on the current direct and indirect holdings of Directors or other related parties of ABx Group of the exercise of SPP Options, if exercised, will be the same as the proportionate effect on other shareholders.

Directors are not required under the Constitution to hold any Shares.

4.3 Financial Effect

The effect of the Entitlement Offer would be a reduction of ABx Group’s cash in hand by $10,706 in order to pay the costs of the Entitlement Offer.

5. Application Instructions

Applications for SPP Options can only be made by Eligible Shareholders at the direction of the Company.

No subscription monies are payable for the SPP Options offered pursuant to this Prospectus as the SPP Options are being issued as an entitlement to Eligible Shareholders on the basis of one (1) SPP Option for every one (1) Share subscribed for and issued under the SPP.

6. Further Information

If you have any questions about applying for SPP Options, please contact ABx Group Secretary on 02 9251 7177 (or by facsimile on 02 9251 7500 or by email [email protected]). Alternatively, contact your stockbroker or other professional adviser.

The issue of SPP Options is expected to occur after the Entitlement Offer Issue has closed at or about the date set out in the timetable on page 3 of this Prospectus (which dates may change without notice). Thereafter statements of option holdings will be despatched.

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ABx Group Options Prospectus

ABx Group may reject an application at its discretion. ABx Group reserves the right to reject any application and to allocate and issue fewer SPP Options than applied for by an applicant. If an application is rejected in whole or in part, the application monies (or balance of the application monies) received will be refunded to the applicant without interest. ABx Group may reject an application where payment of the application amount is not received or a cheque is not honoured, or without prejudice to its rights, issue SPP Options in response to the application and recover the outstanding application amount from the recipient.

It is the responsibility of recipients to determine their allocation prior to trading in SPP Options, exercising SPP Options or trading in shares issued upon exercise of SPP Options. Recipients trading shares issued upon exercise of SPP Options before they receive their statements will do so at their own risk.

This Prospectus does not constitute an offer in any place in which, or to any person to whom, it would not be lawful to make such an offer. Persons resident in countries outside Australia should consult their professional advisers as to whether any governmental or other consent are required or whether formalities need to be observed to enable them to acquire or exercise SPP Options. Return of an Entitlement Form or payment of an application amount will be taken by ABx Group to constitute a representation that there has been no breach of such requirements.

No account has been taken of the particular objectives, financial situation or needs of recipients of this Prospectus. Because of this, recipients of this Prospectus should have regard to their own objectives, financial situation and needs.

Recipients of this Prospectus should make their own independent investigation and assessment of ABx Group, its business, assets and liabilities, prospects and profits and losses, and the risks associated with investing in ABx Group. Independent expert advice should be sought before any decision is made to apply for SPP Options, exercise options or invest ABx Group.

6.1 Litigation

As at the date of this Prospectus, other than as set out elsewhere in this Prospectus, the Company is not involved in any legal proceedings and the Directors are not aware of any legal proceedings pending or threatened against the Company.

6.2 Continuous Disclosure Obligations

This Prospectus is issued by ABx Group in accordance with the provisions of the Corporations Act applicable to a prospectus for continuously quoted securities or options to acquire continuously quoted securities of ABx Group.

Section 713 of the Corporations Act enables a company to issue a special prospectus where the securities or options offered to acquire securities are continuously quoted securities within the meaning of the Corporations Act. This generally means that the relevant securities offered or securities acquired upon exercise of offered options are in a class of securities that were quoted enhanced disclosure securities at all times during the 12 months before the date of this Prospectus.

In summary, special prospectuses are required to contain information in relation to the effect of the offer of securities on the company and the rights and liabilities attaching to the securities. It is not necessary to include general information in relation to all of the assets and liabilities, financial position, profits and losses or prospects of the issuing company. Accordingly, this Prospectus does not contain the same level of disclosure as a prospectus of an unlisted company or an initial public offering prospectus.

Having taken such precautions and having made such enquiries as are reasonable, ABx Group believes that it has complied with the general and specific requirements of ASX as applicable from time to time throughout the 12 months before the date of this Prospectus which required ABx Group to notify ASX of information about specified events or matters as they arise for the purpose of ASX making that information available to the stock market conducted by ASX.

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ABx Group Options Prospectus

For the purpose of satisfying section 713(5) of the Corporations Act a prospectus must incorporate information, if such information:

(a) has been excluded from a continuous disclosure notice in accordance with the ASX Listing Rules; and
(b) is information that investors and their professional advisors would reasonably require for the purpose of making an informed assessment of:
(c) the assets and liabilities, financial position and performance, profit and losses and prospects of ABx Group; and
(d) the rights and liabilities attaching to the securities being offered.

The prospectus must contain this information only to the extent to which it is reasonable for investors and their professional advisors to expect to find such information in the prospectus. ABx Group is not aware of any matters that need to be disclosed under this section of the Corporations Act that have not been previously disclosed or which have not been set out in this Prospectus.

ABx Group seeks and engages in discussions on an ongoing basis in respect of potential opportunities for the establishment of new and the expansion of existing activities and business development opportunities. While ABx Group continues to seek and negotiate potential commercial opportunities in this respect, there is no certainty that any arrangement(s) will be finalised on particular terms, at a specific time, or at all. ABx Group will make further announcements in respect of any such discussions or negotiations in accordance with its disclosure obligations as developments occur.

As a disclosing entity under the Corporations Act, ABx Group is subject to regular reporting and disclosure obligations. Copies of documents lodged with ASIC in relation to ABx Group may be obtained from, or inspected at, an office of ASIC.

Any person may request, and ABx Group will provide free of charge, a copy of each of the following documents during the application period of this Prospectus:

(a) the annual financial report of ABx Group for the financial year ended 31 December 2020 (lodged with ASIC and released to ASX on 31 March 2020), being the most recent annual financial report of ABx Group lodged with ASIC before the lodgement of this Prospectus with ASIC; and
(b) any continuous disclosure notices given by ABx Group since the lodgement of the annual financial report referred to in (a) above before lodgement of this Prospectus. Continuous disclosure notices given by ABx Group since the lodgement of the annual financial report to the date of this Prospectus are listed in Section 6.3 of this Prospectus.

6.3 ASX Announcements

The following announcements (continuous disclosure notices) have been made by ABx Group to ASX since lodging its audited financial statements (annual financial report) for the year ended 31 December 2020 on 31 March 2021:

Date	Headline
11 Nov 21	Notice of Extraordinary General Meeting/Proxy Form
09 Nov 21	CEO Presentation at Noosa Mining Investor Conference
01 Nov 21	Appendix 3Y - Paul Lennon
01 Nov 21	Quarterly Activities/Appendix 5B Cash Flow Report
29 Oct 21	Cleansing Statement

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29 Oct 21	ABx Group Completes SPP with $4 million Raised
29 Oct 21	Application for quotation of securities - ABX
25 Oct 21	Share Purchase Plan Closed
20 Oct 21	SPP Further Varied Due to Overwhelming Demand
19 Oct 21	Share Purchase Plan Varied Due to Oversubscriptions
18 Oct 21	Modelling Further Confirms Commercial Alf3 Plant Viability
14 Oct 21	ABX Rare Earth Drilling Progress
08 Oct 21	Security Purchase Plan
05 Oct 21	Appendix 3B
01 Oct 21	ABx Group Launches SPP on Same Terms as Capital Raising
13 Sep 21	Rare Earth Processing Studies Provide Encouraging Results
02 Sep 21	Half Yearly Report and Accounts
16 Aug 21	Significant Increase in Rare Earth Prospect Size
02 Aug 21	Quarterly Report and Appendix 5B
22 Jul 21	Appendix 3Y - P Lennon
22 Jul 21	Appendix 3Y - K Boundy
22 Jul 21	Amended Appendix 3Y - I Levy
22 Jul 21	Cleansing Statement
22 Jul 21	Appendix 3Y - I Levy
22 Jul 21	Application for quotation of securities - ABX
22 Jul 21	Notification regarding unquoted securities - ABX
19 Jul 21	Innovative Breakthrough Using Proprietary Technology
19 Jul 21	Pause in Trading
14 Jul 21	Results of Meeting
13 Jul 21	Meeting Notes and Material to be Delivered at AGM
28 Jun 21	Notice of Annual General Meeting/Proxy Form
24 Jun 21	Alcore CEO Presents at Gold Coast Investment Showcase
22 Jun 21	CEO Presentation
10 Jun 21	Notice of Annual General Meeting/Proxy Form
27 May 21	Appendix 2A and Cleansing Statement
27 May 21	Higher Rare Earth Grades - Expanded Target Area
24 May 21	Proposed issue of Securities - ABX
24 May 21	Placement Presentation
24 May 21	ABX Completes Equity Placement and SPP Option Terms
20 May 21	Trading Halt

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04 May 21	Rare Earth Element Assays Confirm Source Rock Area Expansion
03 May 21	Quarterly Report and Activity Statement
12 Apr 21	ABX Alcore Dross Results
01 Apr 21	Appendix 4G

Any person may request, and ABx Group will provide free of charge, a copy of any of the above announcements during the application period of this Prospectus.

ABx Group may make further announcements to ASX from time to time. Copies of announcements are released by ASX on its website, www.asx.com.au under ABx Group’s ASX code “ASX”, and will also be made available on ABx Group's web site, www.abxgroup.com.au. Copies of announcements can also be obtained from ABx Group upon request. Prospective investors are advised to refer to ASX’s website or ABx Group’s website for updated releases about events or matters affecting ABx Group.

In making statements in this Prospectus regard has been had to the fact that ABx Group is a disclosing entity for the purposes of the Corporations Act and certain matters may reasonably be expected to be known to investors and professional advisers whom potential investors may consult.

6.4 Market Price for Shares

The Company is a disclosing entity for the purposes of the Corporations Act and its Shares are enhanced disclosure securities quoted on ASX. No trading in the SPP Options has occurred on ASX, as they are not listed on ASX.

The highest, lowest and last market sale prices of the Shares on ASX during the three months immediately preceding the date of lodgement of this Prospectus with the ASIC and the respective dates of those sales were:

Highest	$0.14	8 September 2021
Lowest	$0.099	12 October 2021
Last	$0.11	10 November 2021

7. Terms of Options Offered

The Options entitle the holder to subscribe for Shares on the following terms and conditions.

7.1 Definitions

In these option conditions:

ASX means ASX Limited;

Bonus Issue has the same meaning as ascribed to the expression "bonus issue" in the Listing Rules;

Business Day means any day except a Saturday or a Sunday or other public holiday in any State or Territory of Australia;

Exercise Commencement Date means the date on which the Options are issued;

Exercise Notice means a notice in writing by the Option Holder to the Issuer pursuant to which the Option Holder states that the Option Holder wishes to exercise the Option duly completed and signed accompanied by the Exercise Price;

Exercise Period means the period between the Exercise Commencement Date and 31 May 2023;

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ABx Group Options Prospectus

Exercise Price means $0.20 per Share;

Issuer means Australian Bauxite Limited ACN 139 494 885;

Listing Rules means the listing rules of the ASX;

Option means an option to acquire a Share on the terms and conditions set out in this Schedule;

Option Certificate means a certificate of holding of an Option issued by or on behalf of the Issuer; Pro Rata Issue has the same meaning as the expression "pro rata issue" has in the Listing Rules;

Register means the register of Option Holders maintained by or for and on behalf of the Issuer;

Share means a fully paid ordinary share in the Issuer;

Tax includes all income tax, company tax, fringe benefits tax, withholding tax, undistributed profits tax, group tax, payroll tax, sales tax, GST, customs or excise duties, land tax, stamp duty or any other tax or levy imposed by a governmental authority together with any interest, penalty, charge, fee or other amount imposed or made on or in respect of any of the foregoing and "Taxation" has a corresponding meaning.

7.2 Interpretation

In these Option Conditions, unless the context otherwise requires:

(a) the Introduction is correct;
(b) headings do not affect interpretation;
(c) singular includes plural and plural includes singular;
(d) words of one gender include any gender;
(e) reference to legislation includes any amendment to it, any legislation substituted for it, and any subordinate legislation made under it;
(f) reference to a person includes a corporation, joint venture, association, government body, firm and any other entity;
(g) reference to a party includes that party's personal representatives, successors and permitted assigns;
(h) reference to a thing (including a right) includes a part of that thing;
(i) reference to two or more persons means each of them individually and any two or more of them jointly;
(j) if a party comprises two or more persons:
(k) reference to a party means each of the persons individually and any two or more of them jointly;
(l) a promise by that party binds each of them individually and all of them jointly;
(m) a right given to that party is given to each of them individually;
(n) a representation, warranty or undertaking by that party is made by each of them individually;
(o) a provision must not be construed against a party only because that party prepared it;

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(p) a provision must be read down to the extent necessary to be valid. If it cannot be read down to that extent, it must be severed;
(q) if a thing is to be done on a day which is not a Business Day, it must be done on the Business Day before that day;
(r) another grammatical form of a defined expression has a corresponding meaning;
(s) an expression defined in the Corporations Act 2001 has the meaning given by the act at the date of this agreement.

7.3 Option Certificates

The Issuer must issue to the Option Holder an Option Certificate with respect to the Options.

7.4 Registration

The Issuer must register the Option Holder as the Option Holder of the Options in the Register.

7.5 Exercise of the Options

(a) Method

The Option Holder must exercise the Options during the Exercise Period by completing and lodging with the Issuer an Exercise Notice duly executed by the Option Holder and paying the Exercise Price.

(b) Allotment of Shares

The Issuer must after an Exercise Notice and payment of the Exercise Price is received in accordance with this clause 6 allot the number of Shares referred to in the Exercise Notice to the Option Holder in accordance with the Listing Rules.

(c) Cancellation or Endorsement of Option Certificate

Upon the allotment of Shares in accordance with clause 6, the Issuer must in respect of the Option Certificate lodged with the Issuer for the purposes of an exercise of Options:

1) if the outstanding Options have been exercised, cancel the Option Certificate; or,
2) if part only of the outstanding Options have been exercised, endorse the Option Certificate with the number of Options that have been exercised and the number of outstanding Options and return the same to the Option Holder.

7.6 Issues and Reorganisations

(a) New Issues

The Option Holder is not entitled by reason only of being a Option Holder of Options to participate in any Bonus Issue, Pro Rata Issue or any other issue of rights to subscribe for additional Shares or any other securities to be issued by the Issuer.

(b) Reorganisation of Capital

1) If an Option has not been exercised and the Issuer reorganises its issued capital including without limitation
A. a consolidation of capital;
B. a subdivision of capital
C. a return of capital;

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D. a reduction of capital by a cancellation of paid up capital that is lost or not represented by available assets where no securities are cancelled;
E. a pro rate cancellation or capital, the number or the Exercise Price of the Options or both to which the Option Holder is entitled will be adjusted in accordance with Listing Rule 7.22.
2) This clause 7.6 is subject to the same provisions with respect to rounding of entitlements as sanctioned by the meeting of shareholders approving the reorganisation of capital.
3) Any other rights of the Holder will be changed to the extent necessary to comply with the Listing Rules applying to a reorganisation of capital at the time of reorganisation but in all other respects the terms for the exercise of the Options shall remain unchanged.

7.7 Rights issues

If the Issuer makes an offer of Shares pro rata to all or substantially all holders of Shares (other than an issue in lieu or in satisfaction of dividends or by way of dividend reinvestment) and no Shares have been allotted in respect of an Option before the date for determining entitlements to the rights issue then the new Exercise Price of the Option will be adjusted in accordance with the following formula:

O[1] = O - E (P - (S + D)) N + 1 Where O[1] = the new exercise price of the Option; O = the old exercise price of the Option; E = the number of Shares into which one Option is exercisable; P = average market price per share (weighted by reference to volume) of the Shares during the 5 trading days ending on the day before the ex rights date or ex entitlements date; S = the subscription price (application money plus calls) for new Shares Issued under the rights issue; D = any dividends declared but not yet paid on existing Shares which will not be payable in respect of new Shares issued under the rights issue; and N = the number of Shares required to be held to receive a right to one new share under the rights issue.

The number of Shares which the Option Holder is entitled to subscribe for on exercise of the Option will not change.

7.8 ASX Listing Rules

(a) This clause 7 is to be read subject to the requirements of the Listing Rules.
(b) In the event of any inconsistency between the provisions of this clause 8 and the provisions of the Listing Rules, the provisions of the Listing Rules must prevail.

7.9 Shares

(a) Rights attaching to Shares

Shares issued pursuant to the exercise of an Option rank pari passu in all respect with all other issued Shares of the Issuer.

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ABx Group Options Prospectus

(b) Quotation of Shares

The Issuer must apply to the ASX within ten (10) business days after the date of issue of any Shares issued upon exercise of the Options, for such Shares to be admitted to quotation.

(c) Interest in Shares

A Holder has no interest in the Shares the subject of the Option Holder's Options until those Options are exercised in accordance with this agreement and the Shares allotted to the Option Holder pursuant to the exercise.

(d) Assignment

The Options are transferable but will not be quoted on the ASX (unless the Issuer determines otherwise).

7.10 Application of Listing Rules

(a) Notwithstanding anything contained in these option conditions, if the Listing Rules prohibit an act being done, the act must not be done.
(b) Nothing contained in this agreement prevents an act being done that the Listing Rules required 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 agreement not to contain a provision and it contains such a provision, this agreement is deemed not to contain that provision.

If any provision of this agreement is or become inconsistent with the Listing Rules, this agreement is deemed not to contain that provision to the extent of any inconsistency.

7.11 Shares issued upon the exercise of Options

The Shares issued upon the exercise of Options (if validly exercised) will be fully paid ordinary shares in the capital of ABx Group, which will rank equally with, and will have the same voting and other rights as the existing issued shares of ABx Group. The rights attaching to ABx Group's shares are set out in ABx Group's Constitution, the Listing Rules of ASX and the Corporations Act. ABx Group's Constitution has been lodged with ASIC. The Constitution contains provisions of the kind common for public companies in Australia and is taken to be included in this Prospectus by operation of section 712 of the Corporations Act. Any person may request a copy of the Constitution during the application period of this Prospectus, which ABx Group will provide free of charge.

8. Directors’ Interests

8.1 Securities

(a) Existing Interests

As at the date of this Prospectus, the Directors' direct and indirect interests in shares and options of ABx Group are as follows:

Director	Direct	Indirect	SPP Options
Paul Lennon	Nil	3,984,869	300,000
Ken Boundy	Nil	2,353,089	300,000
Ian Levy	Nil	6,301,316	400,000

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ABx Group Options Prospectus

(b) Remuneration

The remuneration of an executive Director is decided by the Board, without the affected executive Director participating in that decision-making process. The total maximum remuneration of non-executive Directors is initially set by the Constitution and subsequent variation is by ordinary resolution of Shareholders in general meeting in accordance with the Constitution, the Corporations Act and the ASX Listing Rules, as applicable. The determination of non-executive Directors’ remuneration within that maximum will be made by the Board having regard to the inputs and value to the Company of the respective contributions by each non-executive Director. The current amount has been set at an amount not to exceed $200,000 per annum.

A Director may be paid fees or other amounts (i.e. non-cash performance incentives such as SPP Options, subject to any necessary Shareholder approval) as the other Directors determine where a Director performs special duties or otherwise performs services outside the scope of the ordinary duties of a Director. In addition, Directors are also entitled to be paid reasonable travelling, hotel and other expenses incurred by them respectively in or about the performance of their duties as Directors.

Annual remuneration for non-executive directors is $80,000 for the Chairman and $40,000 for other nonexecutive directors. Where not paid the director fees accrue.

The following table shows the total annual remuneration paid to both executive and non-executive directors.

Director	2019 Financial Year	2020 Financial Year
Paul Lennon	$60,000	$80,000(a)
Ken Boundy	Nil	$80,000(b)
Ian Levy	Nil	$267,500(c)

Notes:

(a) Includes share-based payment of accrued remuneration of $60,000 (excluding GST) approved by shareholders on 29 May 2020
(b) Includes share-based payment of 2 years accrued remuneration of $80,000 (excluding GST) approved by shareholders on 29 May 2020
(c) Includes share-based payment of accrued remuneration of $250,000 approved by shareholders on 29 May 2020

(c) Participation by Directors in the Entitlement Offer

Subject to Shareholder Approval, The Directors may participate in the Entitlement Offer. Except as disclosed in this Prospectus, no Director or proposed Director has, or has had within two years of lodgement of this Prospectus, any interest in:

Except as disclosed in this Prospectus, no Director or proposed Director has, or has had within two years of lodgement of this Prospectus, any interest in:

(a) the formation or promotion of ABx Group; or
(b) any property acquired or proposed to be acquired by ABx Group in connection with its formation or promotion or the Entitlement Offer; or
(c) the Entitlement Offer.

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ABx Group Options Prospectus

9. Other Information

9.1 Fees and other remuneration

Except as disclosed in this Prospectus, no person has paid or agreed to pay any amount to any Director or has given or agreed to give any benefit to any Director, to induce the Director to become, or to qualify as, a Director of ABx Group or otherwise for services rendered by the Director in connection with the formation or promotion of ABx Group or the Entitlement Offer.

9.2 Taxation

Persons invited to apply for SPP Options under this Prospectus should seek and obtain their own taxation advice before applying for or exercising SPP Options so that they may first satisfy themselves of any taxation implications associated with acquiring or exercising SPP Options.

9.3 Overseas Shareholders

This Offer does not constitute an offer in any jurisdiction in which, or to any persons to whom, it would not be lawful to make such an offer.

Shareholders holding Shares on behalf of persons who are not resident in Australia are responsible for ensuring that applying for and being issued SPP Options (or exercising SPP Options and receiving shares) does not breach regulations in the relevant overseas jurisdiction. Persons resident in countries outside Australia should consult their professional advisers as to whether any governmental or other consent are required or whether formalities need to be observed to enable them to acquire or exercise SPP Options. Return of a duly completed Entitlement Form or payment of an application amount will be taken by ABx Group to constitute a representation that there has been no breach of such regulations. Invitees who are nominees are advised to seek independent advice as to how they should proceed. The Entitlement Offer has not been, and will not be, registered under the US Securities Act and has not been made in the United States of America or to persons resident in the United States of America.

This Prospectus is not to be distributed outside Australia and New Zealand. The distribution of this Prospectus in jurisdictions outside Australia and New Zealand may be restricted by law, and persons outside Australia or New Zealand who comes into possession of this Prospectus should seek advice on, and observe any, such restrictions. Any failure to comply with such restrictions may constitute a violation of applicable securities laws. Any person accessing the electronic version of this Prospectus for the purpose of investing in ABx Group must only access it from within Australia or New Zealand.

9.4 Privacy and personal information

The completed Entitlement Form provides personal information about you to ABx Group. ABx Group collects your personal information to process and administer your investment in ABx Group and to provide related services to you. If you do not complete the Entitlement Form in full, ABx Group may not accept your Entitlement Form.

By submitting an Entitlement Form, each Applicant agrees that ABx Group may use the information provided by that Applicant on the Entitlement Form for the purposes set out in this privacy disclosure statement and may disclose it for those purposes to the Share Registry, ABx Group’s related bodies corporate, agents, contractors and third party service providers, including mailing houses and professional advisers and to the ASX and regulatory authorities.

If you become a Security Holder, the Corporations Act requires ABx Group to include information about the Security Holder (including name, address and details of the Securities held) in its public register. The information contained in ABx Group’s public register must remain there even if you cease to be a Security Holder. Information contained in ABx Group’s register is used to facilitate distribution payments and corporate communications (including ABx Group’s financial results, annual reports and other information that ABx Group may wish to communicate to its Security Holders) and for compliance by ABx Group with legal and regulatory requirements.

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ABx Group Options Prospectus

If you do not provide the information required on the Entitlement Form, ABx Group may not be able to accept or process that Application efficiently, or at all.

You have a right to gain access to the information that ABx Group holds about you subject to certain exemptions under law. A fee may be charged for such access. You can obtain access to personal information that ABx Group holds about you. To make a request for access or to obtain further information about ABx Group’s personal information management practices, please contact ABx Group on +61 2 9251 7177.

9.5 Expenses of the Entitlement Offer

The total expenses of the Entitlement Offer are estimated to be approximately $10,706 (excluding GST) and are expected to be applied towards the items set out in the table below:

	$
ASIC fees	3,206
Legal fees	5,000
Printing and distribution	2,500
Total	10,706

9.6 Electronic Prospectus

This Prospectus is available in electronic format for information purposes only at www.abxgroup.com.au.

Persons having received this Prospectus in electronic form may, during the offer period, obtain a paper copy of this Prospectus (free of charge) by telephoning +61 2 9251 7177 (or by facsimile on +61 2 9251 7500 or by email to ABx Group Secretary at [email protected]).

Applications for SPP Options may only be made on the personalised Entitlement Form that accompanied or was attached to a copy of this Prospectus in its paper copy form or a print out of the form which formed part of or was accompanied by the complete and unaltered electronic version of this Prospectus. The Corporations Act prohibits any person from passing on to another person an Entitlement Form unless it is attached to or accompanied by a hard copy of this Prospectus or by the complete and unaltered electronic version of this Prospectus.

ABx Group reserves the right not to accept an application or Entitlement Form from a person if it has reason to believe that when that person was given access to the electronic Entitlement Form, it was not provided together with the complete and unaltered electronic version of this Prospectus.

9.7 Investment Decisions

The information in this Prospectus does not constitute financial product advice. This Prospectus does not take into account the investment objectives, financial situation, tax position and particular needs of individual investors. Investors should obtain their own independent advice and consider the appropriateness of the Entitlement Offer pursuant to this Prospectus having regard to their own objectives, financial situation, tax position and needs.

9.8 Future Performance

Except as required by law, and only then to the extent so required, neither ABx Group nor any other person warrants the future performance of ABx Group, or any return on any investment made pursuant to this Prospectus. An investment by acquiring SPP Options offered by this Prospectus or by exercising SPP Options should be considered speculative.

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ABx Group Options Prospectus

9.9 Enquiries

You should contact your stockbroker, accountant or independent professional financial adviser before making any decision regarding SPP Options, exercising options or investment in ABx Group.

If you are have received an invitation to apply for SPP Options from ABx Group and have any questions regarding how to complete the Entitlement Form, please contact ABx Group Secretary on 02 9251 7177 (or by facsimile on 02 9251 7500 or by email to [email protected]).

No person is authorised to give information or to make any representation in connection with this Prospectus, which is not contained in this Prospectus. Any such information not so contained may not be relied on as having been authorised by ABx Group in connection with this Prospectus.

10. Consents

Computershare Investor Services Pty Limited has given, and has not withdrawn before the lodgement of this Prospectus with ASIC, its written consent to be being named as ABx Group’s Share Registry in the form and context in which it is named.

Computershare Investor Services Pty Limited has had no involvement in the preparation of any part of the Prospectus other than being named as Share Registry to ABx Group. Computershare Investor Services Pty Limited has not authorised or caused the issue of, and expressly disclaims and takes no responsibility for, any part of the Prospectus.

11. Directors’ Authorisation Statement

The Directors of ABx Group have authorised the lodgement of this Prospectus with ASIC.

Ian Levy Director

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ABx Group Options Prospectus

12. Glossary

Terms and abbreviations used in this Prospectus have the following meaning:

A$ or $	an Australian dollar
Applicant	a shareholder who applies for SPP Options pursuant to the Entitlement Offer
Application Form	a Cleansing Offer Application Form
ASIC	Australian Securities and Investments Commission
ASX	ASX Limited (ACN 008 624 691)
ASX Listing Rules	the official listing rules of ASX
Australian Bauxite Limited or ABx Group or Company	Australian Bauxite Group Limited (ACN 139 494 885) of Level 5, 52 Phillip Sydney NSW 2000 and where the context so permits or requires, includes any related body corporate including subsidiaries
Board	Board of Directors of ABx Group for the time being
Business Day	a day, other than a Saturday or Sunday, on which banks are open for general banking business in Sydney
Cleansing Offer	the cleansing offer made for Placement Options as detailed in Sections 2.3 and of this Prospectus respectively
Cleansing Offer Application Form	an application form for the Cleansing Offer
Closing Date	the date by which valid acceptances must be received by the Share Registry, being 8 December 2021 or such other date determined by the Board
Constitution	Constitution of ABx Group as registered with ASIC and as amended from time to time
Corporations Act	the Corporations Act 2001 (Cth) – an Act to make provision in relation to corporations and financial products and services, and for other purposes
Director	a director of ABx Group
Eligible Shareholder	An eligible shareholder as described in the SPP
Entitlement	The entitlement of a Shareholder who is eligible to participate in the Entitlement Offer
Entitlement Form	The Entitlement Form either attached to or accompanying this Prospectus
Entitlement Offer	the offer of 40,786,500 SPP Options pursuant to and in accordance with this Prospectus

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ABx Group Options Prospectus

Offers Period	period from 17 November 2021 to 8 December 2021 when the Entitlement Offer is made
General Meeting	A general meeting of shareholders to be held on 16 December 2021 to approve the issue of the SPP Options.
Group	Australian Bauxite Limited and its subsidiaries
Issue	the issue of SPP Options in accordance with this Prospectus
Issuer Sponsored	Shares issued by an issuer that are held in uncertified form without the holder entering into a sponsorship agreement with a broker or without the holder being admitted as an institutional participant in CHESS.
Offer(s)	The Entitlement Offer or Cleansing Offer as the context requires
Official List	the official list of entities that ASX has admitted and not removed
Opening Date	17 November 2021
option	options to acquire Shares pursuant to and in accordance with this Prospectus which may be exercised by the holder to acquire a Share
Options	SPP Options or Placement Options as the context requires.
Placement	The placement announced on 24 May 2021 of 32,500,000 Shares at $0.10 per Share with attaching options on a 1 for 1 basis, exercisable at $0.20 before 31 May 2023
Placement Options	One unlisted option issued on a 1 for 1 basis, exercisable at $0.20 before 31 May 2023 applied for under the Placement.
Prospectus	this Prospectus dated 11 November 2021 as modified or varied by any replacement or supplementary Prospectus made by ABx Group and lodged with ASIC from time to time, and any electronic copy of this Prospectus, replacement prospectus and supplementary Prospectus
Securities	has the same meaning as in section 92 of the_Corporations Act_
Security Holders or Shareholders	the shareholders of ABx Group from time to time
Share Registry	Computershare Investor Services Pty Limited
Shareholder Approval	Approval by Shareholders at the General Meeting for the issue of SPP Options and other resolutions put before Shareholders at the General Meeting
Shareholders	holders of Shares
Shares	ordinary fully paid shares in the capital of ABx Group

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ABx Group Options Prospectus

SPP Option	One unlisted option issued on a 1 for 1 basis, exercisable at $0.20 before 31 May 2023 applied for under the SPP
SPP Option Holders	holders of options
SPP or Share Purchase Plan	The share purchase plan announced by the Company on 1 October 2021 in which eligible shareholders could subscribe for up to $30,000 worth of Shares at an issue price of $0.20 per share with an entitlement of one SPP Option for every one Share issued exercisable at $0.20, expiring 31 May 2023.
SPP Participants	Persons who subscribed for and were allocated Securities under the SPP.
Sydney Time	Australian Eastern Daylight Time or Australian Eastern Standard Time in effect at the relevant time.

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ABX GROUP LIMITED — Capital/Financing Update 2021

64283_rns_2021-11-10_ee39ed47-9c61-4fae-b8f8-4f560abd2270.pdf

OPTIONS PROSPECTUS

Entitlement Offer

Cleansing Offer

THIS DOCUMENT IS IMPORTANT AND SHOULD BE READ IN ITS ENTIRETY

CORPORATE DIRECTORY

Issuer

Directors

Company Secretary

Share Registry*

Auditors*

IMPORTANT NOTE

Important Information

Expiry Date

Prospectus Availability

Entitlement Offer Conditional

Offer Speculative

Disclaimer

Geographic Restrictions

Transaction Specific Prospectus

No Exposure Period

On-sale of Shares

Risk factors

Overseas Investors

New Zealand

Contents

Letter from the Chairman

Investment Overview

Entitlement Offer

Eligible Participants

Use of Funds

Forward Looking Statements

How do I accept my Entitlement?

What are the tax implications of participating in the Entitlement Offer?

How and when will I know if my application was successful?

Where can I find more information about ABx Group?

What if I have any questions about the Entitlement Offer?

1. About ABx Group

Alcore aluminium fluoride

Rare earth elements (REE) discovery

New bauxite mine developments

2. The Offers

2.1 The Entitlement Offer

SPP Entitlement

Accepting the Entitlement

Reasons to apply for SPP Options

2.2 Placement

2.3 Cleansing Offer

2.4 Opening and Closing Dates

2.5 Underwriting

2.6 Minimum Subscription

2.7 Conditional Offer

2.8 Effect on Control

2.9 No ASX Listing

2.10 Issue

2.11 CHESS

2.12 Overseas SPP Participants

2.13 Notice to nominees and custodians

2.14 Risk factors

2.15 Taxation implications

2.16 Major activities and financial information

2.17 Privacy

2.18 Enquiries concerning Prospectus

3. Risk Factors

3.1 Introduction

3.2 Risks specific to the SPP Options Entitlement Offer

3.3 Risks specific to the Company

(a) Coronavirus (COVID-19) Risk

(b) Exploration Risk

(c) Future Capital Requirements

(d) Taxation Implications

(e) Regulatory Risks

(f) Tenure, Access and Grant of Applications

(g) Environmental Risk

(h) Social Licence

(i) Mine Development Risk

(j) Insurance Risks

(k) Ability to Exploit Successful Discoveries

ABX GROUP LIMITED Capital/Financing Update 2021