ALTECH BATTERIES LTD — Capital/Financing Update 2015

Oct 19, 2015

ASX ANNOUNCEMENT AND MEDIA RELEASE

20 October 2015

$1.0 MILLION SHARE PLACEMENT COMPLETED

Altech Chemicals Limited (Altech/the Company) (ASX: ATC) is pleased to advise that Melewar International Investment Company Limited (Melewar) has now completed the second tranche of its share placement in the Company, following approval by shareholders at the Company’s Annual General Meeting on 15 October 2015.

Melewar’s total investment in the Company is now $1.0 million and following the completion of the placement Melewar holds 16,949,153 shares of the Company, or approximately 11.98% on an undiluted basis.

Melewar is a diversified Malaysian industrial firm with interests in steel, energy and engineering businesses. As previously announced, the Company has invited Melewar to nominated a Malaysian based non-executive director to the join the Altech Board and the Company expects to provide details of this nomination shortly.

Attached is an Appendix 3B for tranche 2 of the placement.

-Ends-

For more information, please contact:

Corporate

Iggy Tan Managing Director Altech Chemicals Limited Tel: +61 8 6168 1555 Email: info@altechchemicals.com

Media Contact

Tony Dawe Consultant Professional Public Relations Tel (office): +61 8 9388 0944 Email: tony.dawe@ppr.com.au

==> picture [64 x 80] intentionally omitted <==

Altech Chemicals Limited ASX:ATC ABN 45 125 301 206

Suite 8, 295 Rokeby Road, Subiaco, Western Australia 6008 Australia

Telephone: +61 8 6168 1555 Facsimile: +61 8 6168 1551 Website: www.altechchemicals.com

About Altech Chemicals (ASX: ATC)

Altech Chemicals Limited (Altech/the Company) is aiming to become one of the world's leading suppliers of 99.99% (4N) high purity alumina ( HPA ) (Al2O3).

HPA is a high-value, high margin and highly demanded product as it is the critical ingredient required for the production of sapphire substrates which are used in the manufacture of LED lights, for the manufacture of alumina semiconductor wafers that are widely used in the electronics industry and for the manufacture of scratch resistant artificial sapphire glass used for watch faces, camera lenses and by various smartphone manufacturers. There is no substitute for HPA in the manufacture of sapphire substrates, sapphire semiconductor wafers or scratchproof sapphire glass.

==> picture [75 x 98] intentionally omitted <==

Global HPA demand is approximately 19,040tpa (2014) and demand is growing at an annual rate of 28%, primarily driven by the growth in LED’s as this energy efficient, longer lasting and lower operating cost lighting replaces traditional incandescent bulbs. HPA demand is expected to at least double over the coming decade.

Current HPA producers use an expensive and highly processed feedstock material such as aluminium metal to produce HPA. Altech has completed a Bankable Feasibility Study (BFS) for the construction and operation of a 4,000tpa HPA plant at Tanjung Langsat, Malaysia. The plant will produce HPA directly from kaolin clay which will be sourced from the Company’s 100% owned kaolin deposit at Meckering, Western Australia. Altech’s production process will employ conventional “off-the-shelf” plant and equipment to extract HPA using a hydrogen chloride (HCl) leaching process. Production costs are anticipated to be considerably lower than established HPA producers.

The Company is currently in the process of securing project financing with the aim of commencing project development in Q1-2016.

Forward-looking Statements

This announcement contains forward-looking statements which are identified by words such as ‘anticipates’, ‘forecasts’, ‘may’, ‘will’, ‘could’, ‘believes’, ‘estimates’, ‘targets’, ‘expects’, ‘plan’ or ‘intends’ and other similar words that involve risks and uncertainties. Indications of, and guidelines or outlook on, future earnings, distributions or financial position or performance and targets, estimates and assumptions in respect of production, prices, operating costs, results, capital expenditures, reserves and resources are also forward looking statements. These statements are based on an assessment of present economic and operating conditions, and on a number of assumptions and estimates regarding future events and actions that, while considered reasonable as at the date of this announcement and are expected to take place, are inherently subject to significant technical, business, economic, competitive, political and social uncertainties and contingencies. 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 our Company, the Directors and management. We cannot and do not give any assurance that the results, performance or achievements expressed or implied by the forward-looking statements contained in this announcement will actually occur and readers are cautioned not to place undue reliance on these forward-looking statements. These forward looking statements are subject to various risk factors that could cause actual events or results to differ materially from the events or results estimated, expressed or anticipated in these statements.

Rule
2.7,
3.10.3,
3.10.4,
3.10.5

**Appendix

3B**

**New

issue
announcement, application
for
quotation
of
additional
securities and
agreement**

Information
or
documents
not
available
now
must
be
given
to
ASX
as
soon
as
available.
Information
and documents
given
to
ASX
become
ASX’s
property
and
may
be
made
public. Introduced
01/07/96
Origin:
Appendix
5
Amended
01/07/98,
01/09/99,
01/07/00,
30/09/01,
11/03/02,
01/01/03,
24/10/05,
01/08/12

20
October
2015

Name
of
entity

Altech
Chemicals
Limited

ABN

45
125
301
206

We
(the
entity)
give
ASX
the
following
information.

**Part

1
-­‐
All
issues**

You
must
complete
the
relevant
sections
(attach
sheets
if
there
is
not
enough
space).

1 +Class of+securities issued or to be issued 2 Number of+securities issued or to be issued (if known) or maximum number which may be issued 3 Principal terms of the+securities (e.g, if options, exercise price and expiry date; if partly paid+securities, the amount outstanding and due dates for payment; if+convertible securities, the conversion price and dates for conversion)	Ordinary Shares
	8,474,577 ordinary shares
	8,474,577 fully paid ordinary shares to Melewar IIC Limited, being tranche 2 of its $1.0 million share placement in the Company

• See
  chapter
  19
  for
  defined
  terms.

01/08/2012

Appendix
3B
Page
3

4 Do the+securities rank equally in all respects from the date of allotment with an existing+class of quoted+securities? If the additional securities do not rank equally, please state: • the date from which they do • the extent to which they participate for the next dividend, (in the case of a trust, distribution) or interest payment • the extent to which they do not rank equally, other than in relation to the next dividend, distribution or interest payment 5 Issue price or consideration 6 Purpose of the issue (If issued as consideration for the acquisition of assets, clearly identify those assets) 6a Is the entity an+eligible entity that has obtained security holder approval under rule 7.1A? If Yes, complete sections 6b – 6h_in_ relation to the+securities the subject of this Appendix 3B, and comply with section 6i 6b The date the security holder resolution under rule 7.1A was passed 6c Number of+securities issued without security holder approval under rule 7.1 6d Number of+securities issued with security holder approval under rule 7.1A 6e Number of+securities issued with security holder approval under rule 7.3, or another specific security holder approval (specify date of meeting)	yes
	$0.059 per share
	Detailed design for the Company’s proposed High Purity Alumina plant, corporate cost and general working capital purposes.
	Yes
	15 October 2015
	nil
	nil
	8,474,577 – as per Security Holder approval at Annual General Meeting on 15 October, 2015

• See
  chapter
  19
  for
  defined
  terms.

01/08/2012

Appendix
3B
Page
4

6f Number of securities issued under an exception in rule 7.2 6g If securities issued under rule 7.1A, was issue price at least 75% of 15 day VWAP as calculated under rule 7.1A.3? Include the issue date and both values. Include the source of the VWAP calculation. 6h If securities were issued under rule 7.1A for non-cash consideration, state date on which valuation of consideration was released to ASX Market Announcements 6i Calculate the entity’s remaining issue capacity under rule 7.1 and rule 7.1A – complete Annexure 1 and release to ASX Market Announcements 7 Dates of entering +securities into uncertificated holdings or despatch of certificates 8 Number and+class of all+securities quoted on ASX (including the securities in section 2 if applicable)	n/a
	n/a
	nil
	7.1: 18,714,257 7.1A: 14,142,838
	19 October 2015
	Number	~~+~~Class
	141,428,383 3,998,985	Ordinary Shares Options (exercise price $0.10, expiring 15 December 2015)

• See
  chapter
  19
  for
  defined
  terms.

01/08/2012

Appendix
3B
Page
5

ASX ANNOUNCEMENT AND MEDIA RELE 9 Number and+class of all+securities not quoted on ASX (_including_the securities in section 2 if applicable) 10 Dividend policy (in the case of a trust, distribution policy) on the increased capital (interests)	Number	+Class
	ASE 2,500,000 1,000,000 1,000,000 1,000,000 600,000 5,700,000 10,000,000 5,250,000	Ex. $0.10, Expiry 30-06-2016 Ex. $0.20, Expiry 18-12-2017 Ex. $0.25, Expiry 18-12-2017 Ex. $0.30, Expiry 18-12-2017 Ex. $0.20, Expiry 31-01-2017 Performance Rights: Employees & Consultants Performance Rights: Managing Director Performance Rights: Directors
	n/a

**Part

2
-­‐
Bonus
issue
or
pro
rata
issue**

11 Is security holder approval required? 12 Is the issue renounceable or non- renounceable? 13 Ratio in which the+securities will be offered 14 +Class of+securities to which the offer relates 15 +Record date to determine entitlements 16 Will holdings on different registers (or subregisters) be aggregated for calculating entitlements? 17 Policy for deciding entitlements in relation to fractions 18 Names of countries in which the entity has+security holders who will not be sent new issue documents Note: Security holders must be told how their entitlements are to be dealt with. Cross reference: rule 7.7.

19 Closing date for receipt of acceptances or renunciations 20 Names of any underwriters 21 Amount of any underwriting fee or commission 22 Names of any brokers to the issue 23 Fee or commission payable to the broker to the issue 24 Amount of any handling fee payable to brokers who lodge acceptances or renunciations on behalf of+security holders 25 If the issue is contingent on+security holders’ approval, the date of the meeting 26 Date entitlement and acceptance form and prospectus or Product Disclosure Statement will be sent to persons entitled 27 If the entity has issued options, and the terms entitle option holders to participate on exercise, the date on which notices will be sent to option holders 28 Date rights trading will begin (if applicable) 29 Date rights trading will end (if applicable) 30 How do+security holders sell their entitlements_in full_through a broker? 31 How do+security holders sell_part_of their entitlements through a broker and accept for the balance?

• See
  chapter
  19
  for
  defined
  terms.

01/08/2012

Appendix
3B
Page
7

• 32 How
  do[+] security
  holders
  dispose
  of their
  entitlements
  (except
  by
  sale through
  a
  broker)?

• 33 +Despatch
  date

**Part

3
-­‐
Quotation
of
securities**

You
need
only
complete
this
section
if
you
are
applying
for
quotation
of
securities

• 34 Type
  of
  securities ( tick
  one )

• (a) ü[Securities
  described
  in
  Part
  1
  ]

• (b) All
  other
  securities

Example:
restricted
securities
at
the
end
of
the
escrowed
period,
partly
paid
securities
that
become
fully
paid, employee
incentive
share
securities
when
restriction
ends,
securities
issued
on
expiry
or
conversion
of
convertible securities

**Entities

that
have
ticked
box
34(a)**

**Additional

securities
forming
a
new
class
of
securities**

Tick
to
indicate
you
are
providing
the
information
or documents

• 35 If
  the[+] securities
  are[+] equity
  securities,
  the
  names
  of
  the
  20
  largest
  holders
  of
  the additional[+] securities,
  and
  the
  number
  and
  percentage
  of
  additional[+] securities held
  by
  those
  holders

• 36 If
  the[+] securities
  are[+] equity
  securities,
  a
  distribution
  schedule
  of
  the
  additional +securities
  setting
  out
  the
  number
  of
  holders
  in
  the
  categories 1
  -­‐
  1,000

• 1,001
  -­‐
  5,000 5,001
  -­‐
  10,000 10,001
  -­‐
  100,000

• 100,001
  and
  over

• 37 A
  copy
  of
  any
  trust
  deed
  for
  the
  additional[+] securities

• See
  chapter
  19
  for
  defined
  terms.

01/08/2012

Appendix
3B
Page
8

**Entities

that
have
ticked
box
34(b)**

38 Number of securities for which +quotation is sought 39 Class of +securities for which quotation is sought 40 Do the+securities rank equally in all respects from the date of allotment with an existing+class of quoted+securities? If the additional securities do not rank equally, please state: • the date from which they do • the extent to which they participate for the next dividend, (in the case of a trust, distribution) or interest payment • the extent to which they do not rank equally, other than in relation to the next dividend, distribution or interest payment 41 Reason for request for quotation now Example: In the case of restricted securities, end of restriction period (if issued upon conversion of another security, clearly identify that other security) 42 Number and +class of all +securities quoted on ASX (_including_the securities in clause 38)
	Number	+Class

• See
  chapter
  19
  for
  defined
  terms.

01/08/2012

Appendix
3B
Page
9

**Quotation

agreement**

• 1 +Quotation
  of
  our
  additional +securities
  is
  in
  ASX’s
  absolute
  discretion.
  ASX may
  quote
  the[+] securities
  on
  any
  conditions
  it
  decides.

• 2 We
  warrant
  the
  following
  to
  ASX.

• The
  issue
  of
  the[+] securities
  to
  be
  quoted
  complies
  with
  the
  law
  and
  is not
  for
  an
  illegal
  purpose.

• There
  is
  no
  reason
  why
  those[+] securities
  should
  not
  be
  granted + quotation.

• An
  offer
  of
  the[+] securities
  for
  sale
  within
  12
  months
  after
  their
  issue will
  not
  require
  disclosure
  under
  section
  707(3)
  or
  section
  1012C(6)
  of the
  Corporations
  Act.

Note:
An
entity
may
need
to
obtain
appropriate
warranties
from
subscribers
for
the
securities
in
order
to
be able
to
give
this
warranty

• Section
  724
  or
  section
  1016E
  of
  the
  Corporations
  Act
  does
  not
  apply
  to any
  applications
  received
  by
  us
  in
  relation
  to
  any[+] securities
  to
  be quoted
  and
  that
  no-­‐one
  has
  any
  right
  to
  return
  any[+] securities
  to
  be quoted
  under
  sections
  737,
  738
  or
  1016F
  of
  the
  Corporations
  Act
  at
  the time
  that
  we
  request
  that
  the[+] securities
  be
  quoted.

• If
  we
  are
  a
  trust,
  we
  warrant
  that
  no
  person
  has
  the
  right
  to
  return
  the +securities
  to
  be
  quoted
  under
  section
  1019B
  of
  the
  Corporations
  Act
  at the
  time
  that
  we
  request
  that
  the[+] securities
  be
  quoted.

• 3 We
  will
  indemnify
  ASX
  to
  the
  fullest
  extent
  permitted
  by
  law
  in
  respect
  of
  any claim,
  action
  or
  expense
  arising
  from
  or
  connected
  with
  any
  breach
  of
  the warranties
  in
  this
  agreement.

• 4 We
  give
  ASX
  the
  information
  and
  documents
  required
  by
  this
  form.

If
any information
or
document
not
available
now,
will
give
it
to
ASX
before +quotation
of
the +securities
begins.
We
acknowledge
that
ASX
is
relying
on the
information
and
documents.
We
warrant
that
they
are
(will
be)
true
and complete.

Sign
here: Date:
20
October
2015
( ~~Director/~~ Company
Secretary) Print
name: Shane
Volk

==
==
==
==
==

• See
  chapter
  19
  for
  defined
  terms.

01/08/2012

Appendix
3B
Page
10

**Appendix

3B
–
Annexure
1**

**Calculation

of
placement
capacity
under
rule
7.1
and rule
7.1A
for[+] eligible
entities**

Introduced
01/08/12

**Part

1**

Rule 7.1 – Issues exceeding 15% of capital

Step 1: Calculate “A”, the base figure from which the placement capacity is calculated

Part 1	Part 1
Rule 7.1 – Issues exceeding 15% of capital
Step 1: Calculate “A”, the base figure from which the placement capacity is calculated
Insertnumber of fully paid ordinary securities on issue 12 months before date of issue or agreement to issue	107,758,502
Addthe following: • Number of fully paid ordinary securities issued in that 12 month period under an exception in rule 7.2 • Number of fully paid ordinary securities issued in that 12 month period with shareholder approval • Number of partly paid ordinary securities that became fully paid in that 12 month period Note: • Include only ordinary securities here – other classes of equity securities cannot be added • Include here (if applicable) the securities the subject of the Appendix 3B to which this form is annexed • It may be useful to set out issues of securities on different dates as separate line items	3,777,735 (pro-rata Entitlement Offer 12/14) 226,880 (Vesting of Employee Rights 2/15) 250,000 (Director participation in Pro Rata Entitlement Offer) 50,000 (Vesting of Performance Rights 4/8/15) 8,974,576 (share placement 11/08/2015 approved by shareholders 15/10/2015) 5,052,100 (Vesting of Performance Rights 25/8/15) 6,779,663 (conversion of various loan amounts to equity 24-9-15, approved by shareholders 15/10/2015) 28,750 (conversion of listed options 7/10/2015) 55,600 (Vesting of Employee Rights 8/10/2015) 8,474,577 (share placement 19/10/2015 approved by shareholders 15/10/2015)
Subtractthe number of fully paid ordinary securities cancelled during that 12 month period	Nil
“A”	141,428,383

• See
  chapter
  19
  for
  defined
  terms.

01/08/2012

Appendix
3B
Page
11

Step 2: Calculate 15% of “A”

Step 2: Calculate 15% of “A”	Step 2: Calculate 15% of “A”
“B”		0.15
		[Note: this value cannot be changed]
Multiply“A” by 0.15		21,214,257
Step 3: Calculate “C”, the amount of placement capacity under rule 7.1
that has already been used
Insertnumber of equity securities issued or		2,500,000	(Options Ex $0.10, Exp. 30 June,
agreed to be issued in that 12 month period			2016)
not	_counting_those issued:
•	Under an exception in rule 7.2
•	Under rule 7.1A
•	With security holder approval under rule
	7.1 or rule 7.4
Note:
•	This applies to equity securities, unless
	specifically excluded – not just ordinary
	securities
•	Include here (if applicable) the securities
	the subject of the Appendix 3B to which
	this form is annexed
•	It may be useful to set out issues of
	securities on different dates as separate
	line items

Step 2: Calculate 15% of “A”	Step 2: Calculate 15% of “A”
“B”	0.15 [Note: this value cannot be changed]
Multiply“A” by 0.15	21,214,257
Step 3: Calculate “C”, the amount of placement capacity under rule 7.1 that has already been used
Insertnumber of equity securities issued or agreed to be issued in that 12 month period not counting_those issued: • Under an exception in rule 7.2 • Under rule 7.1A • With security holder approval under rule 7.1 or rule 7.4 _Note: • This applies to equity securities, unless specifically excluded – not just ordinary securities • Include here (if applicable) the securities the subject of the Appendix 3B to which this form is annexed • It may be useful to set out issues of securities on different dates as separate line items	2,500,000 (Options Ex $0.10, Exp. 30 June, 2016)
“C”	2,500,000
Step 4: Subtract “C” from [“A” x “B”] to calculate remaining placement capacity under rule 7.1
“A” x 0.15 Note: number must be same as shown in Step 2	21,214,257
Subtract“C” Note: number must be same as shown in Step 3	(2,500,000)
Total[“A” x 0.15] – “C”	18,714,257 [Note: this is the remaining placement capacity under rule 7.1]

• See
  chapter
  19
  for
  defined
  terms.

01/08/2012

Appendix
3B
Page
12

Part 2

==> picture [415 x 483] intentionally omitted <==

----- Start of picture text -----

Rule 7.1A – Additional placement capacity for eligible entities
Step 1: Calculate “A”, the base figure from which the placement
capacity is calculated
“A” 141,428,383
Note: number must be same as shown in
Step 1 of Part 1
Step 2: Calculate 10% of “A”
“D” 0.10
Note: this value cannot be changed
Multiply “A” by 0.10 14,142,838
Step 3: Calculate “E”, the amount of placement capacity under rule
7.1A that has already been used
Insert number of equity securities issued or
agreed to be issued in that 12 month period
under rule 7.1A
Notes:
• This applies to equity securities – not
just ordinary securities
• Include here – if applicable – the
securities the subject of the Appendix
3B to which this form is annexed
• Do not include equity securities issued
under rule 7.1 (they must be dealt with
in Part 1), or for which specific security
holder approval has been obtained
• It may be useful to set out issues of
securities on different dates as separate
line items
“E” 14,142,838
----- End of picture text -----

• See
  chapter
  19
  for
  defined
  terms.

01/08/2012

Appendix
3B
Page
13

Step 4: Subtract “E” from [“A” x “D”] to calculate remaining placement capacity under rule 7.1A

Step 4: Subtract “E” from [“A” x “D”] to calculate remaining placement capacity under rule 7.1A	Step 4: Subtract “E” from [“A” x “D”] to calculate remaining placement capacity under rule 7.1A
“A” x 0.10 Note: number must be same as shown in Step 2	11,719,957
Subtract“E” Note: number must be same as shown in Step 3	8,974,576
Total[“A” x 0.10] – “E”	2,745,381 Note: this is the remaining placement capacity under rule 7.1A

• See
  chapter
  19
  for
  defined
  terms.

01/08/2012

Appendix
3B
Page
14