AUKING MINING LIMITED — Capital/Financing Update 2021

Mar 1, 2021

AuKing Mining Limited ABN 29 070 859 522

Suite 11, Level 4, 320 Adelaide Street Brisbane QLD 4000 GPO Box 216 Brisbane QLD 4001 Tel: +61 7 3041 1306

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2 March 2021

The Manager Listings Compliance ASX, SYDNEY

RE: SHORT-TERM CONVERTIBLE NOTE ISSUE

Please find attached details of the terms and conditions relating to the issue of 520,000 convertible notes in the Company at an issue price of $1 per note to clients of Novus Capital Limited, including a large institutional investor.

Novus Capital is the Company’s Lead Manager for the proposed minimum $6million capital raising of the Company – details of which will be announced shortly. The convertible note terms are similar to the Company’s existing issued notes and are summarized as follows:

Total funds raised - $520,000

Notes term – 31 December 2021

Interest payable – 10% per annum, payable quarterly in arrears

Convertibility –

• (a) automatically, on completion of the Company’s proposed capital raising, as part of the proposed ASX re-listing of AKN’s shares – at an issue price of 12c per share (a 40% discount to the proposed 20c public offer price);

• (b) at the election of the holder, notes may (subject to AKN shareholder approval and prior to maturity) be converted at a 55% discount to the proposed 20c issue price to be offered to the public under the Company’s prospectus (namely, 9 cents per share).

The funds raised from the issue of these convertible notes will be used for ongoing operating costs and costs associated with the Koongie Park earn-in agreement and the Company’s re-compliance activities including a prospectus capital raising, shareholder meeting and other actions as may be required by ASX.

An Appendix 3b in relation to the issue will be lodged separately.

This announcement is authorized by:

Paul Williams Managing Director p.williams@aukingmining.com +61 419 762 487

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AuKing Mining Limited Unlisted $1 Convertible Notes

No.	Facility
1.	Issuer	AuKing Mining Limited ACN 070 859 522 (Company orIssuer).
2.	Investor	Various clients of Novus Capital Limited
3.	Instrument	Convertible redeemable notes (Notes).
4.	Face Value	On issue each Note will have a face value of $1.00 per Note.
5.	Total Value of Notes orPrincipal Amount	$520,000
6.	Rights attached	The Notes are:(a) convertible automatically, upon completion by theCompany of the proposed re-admission of its sharesfor official quotation on the ASX into fully paidordinary shares (Shares) ranking equally with allother Shares; or(b) convertible at Maturity at the election of the Investorinto fully paid ordinary shares in Issuer, rankingequally with all other Shares; or(c)redeemable at the election of the Issuer at any timeon or before the Maturity Date; or(d) redeemable at the election of the Investor on theMaturity Date.
7.	Term	Approximately 10 months, commencing on the Issue Date andending on the Maturity Date.
8.	Interest Rate	Interest at the rate of 10% per annum shall apply on the Notes,payable quarterly in arrears. In the event of automaticconversion under item 6(a), accrued interest will be paid out ofthe proceeds of the Company’s capital raising.
9.	Maturity Date	31 December 2021.
10.	Approved Purpose	The funds will be used for the purposes of enabling the Issuerto complete its prospectus and associated materials for theproposed capital raising to enable the Issuer to gain ASX re-admission to the ASX and proceed with the Koongie Parkcopper project earn-in agreement in accordance with theIssuer’s announcement on 25 June 2020 (ApprovedPurpose).
11.	Issue of Notes andavailability of proceeds	The Notes will be issued upon receipt by the Issuer of theirFace Value in Immediately Available Funds, on the IssueDate.
12.	Issue Date	The date being 7 days after the date of this Term Sheet.
13.	Redemption or Conversionof Notes	The Notes will be either:(a)Converted automatically at completion of theCompany’s re-admission to the ASX;(b)Converted on the Maturity Date at the Investor’selection;(c)redeemed on or before Conversion, at the Issuer’selection;

AKN December 2021 Unlisted Convertible Notes

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		No.	Facility
				(d)redeemed on the Maturity Date, at the Investor’selection;(e)repaid on the occurrence of an Event of Default; or(f)a combination of one or more of the alternatives set outabove in accordance with the terms of this Term Sheet.
		14.	Excluded offers only	The Issuer may only issue Notes to persons to whomdisclosure under Part 6D.2 of the Corporations Act is notrequired. Examples of such persons may include:(a)Small scale raisings, as set out in section 708(1) of theCorporations Act (20 in 12 months, less than $2M fundsraised);(b)sophisticated investors, being investors to whomsection 708(8) of the Corporations Act applies;(c)professional investors, being investors to whom section708(11) of the Corporations Act applies; and(d)persons associated with the Company, being persons towhom section 708(12) of the Corporations Act applies.
			’
		15.	Investors Conversion	(a)Subject to paragraph (c) below, the Investor mayconvert any or all of the Notes on the MaturityDate (Conversion).(b)The Conversion Price per Conversion Share for aConversion under paragraph 13(a) shall be a 40%discount to the proposed 20c issue price to be offeredto the public under the Company’s prospectus (namely,12 cents per share) (Conversion Price).(c)Investor acknowledges and agrees that ASX mayimpose restrictions on trading of Shares in accordancewith their standard cash formula – meaning that 40% ofthe Shares to be issued to the Investor may be subject
			Rights	convert any or all of the Notes on the MaturityDate (Conversion).(b)The Conversion Price per Conversion Share for aConversion under paragraph 13(a) shall be a 40%discount to the proposed 20c issue price to be offeredto the public under the Company’s prospectus (namely,12 cents per share) (Conversion Price).(c)Investor acknowledges and agrees that ASX mayimpose restrictions on trading of Shares in accordance
				to this restriction.(d)The Conversion Price per Conversion Share if theInvestor makes an election under paragraph 13(b) shallbe a 55% discount to the proposed 20c issue price tobe offered to the public under the Company’sprospectus (namely, 9 cents per share) (ConversionPrice).(e)Conversion of the Notes shall be conditional upon theIssuer obtaining any required shareholder approvalunder the Corporations Act 2001 (Cth) or the ListingRules of ASX to issue the Conversion Shares(Conversion Approval).(f)Subject to paragraph (c) above and the receipt of avalid Conversion Notice, the Issuer is obliged to issuethe Conversion Shares on the Maturity Date.(g)Each Conversion Share will rank, on and from issue, inall respects_pari passu_with the Shares then on issue,and the Issuer will use its reasonable endeavours toapply to ASX for official quotation of the ConversionShares.
		16.	Voting rights prior toconversion	The Notes shall carry the right to attend but not to vote at anygeneral meeting of the Issuer prior to their conversion intoShares.

AKN December 2021 Unlisted Convertible Notes

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	No.	Facility
	17.	Rights to	participate in new	The Notes do not carry any entitlement to	participate in any	n
		issues		future issues of Shares by the Issuer priointo Shares.	r to their conversio
	18.	No listing		The notes will not be listed on ASX or anstock exchange.	y other recognised
	19.	Transferability		The Notes shall be transferable in accordance with theConditions.
	Events of defaul		t
						r
	20.	Events of	default	Event of default means:(a) An Insolvency Event occurringCompany; or	in respect of the
				(b) in relation to a Holder, the ComMoney Owing to that Holder wpayment.	pany failing to payhen they fall due fo

AKN December 2021 Unlisted Convertible Notes

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