CLASSIC MINERALS LTD - Share Issue/Capital Change 2021

ACN 119 484 016

Classic Minerals Limited

BONUS ISSUE PROSPECTUS

for

A bonus issue of one (1) bonus option for every four (4) shares held on the record date ( offer )

No funds will be raised as a result of the offer .

This document is important and should be read in its entirety. If after reading this prospectus you have any questions about the securities being offered under this prospectus or any other matter, then you should consult your stockbroker, accountant or other professional advisor.

Shares issued on exercise of the bonus options offered by this prospectus should be considered as highly speculative.

	CONTENTS
1.	CORPORATE DIRECTORY ............................................................................................. 3
2.	TIMETABLE ......................................................................................................................... 4
3.	IMPORTANT NOTES ........................................................................................................ 5
3.1.	Lodgement and timing ........................................................................................................... 5
3.2.	Disclaimer ................................................................................................................................ 5
3.3.	Continuously quoted securities ............................................................................................. 5
3.4.	Risks.......................................................................................................................................... 5
3.5.	Applications ............................................................................................................................. 6
3.6.	Forward-looking statements ................................................................................................. 6
3.7.	Overseas shareholders ........................................................................................................... 6
3.8.	Taxation ................................................................................................................................... 7
3.9.	Privacy ...................................................................................................................................... 7
3.10.	Speculative investment........................................................................................................... 7
3.11.	Other matters .......................................................................................................................... 8
3.12.	Enquiries .................................................................................................................................. 8
4.	DETAILS OF THE OFFER ............................................................................................... 9
4.1.	Summary .................................................................................................................................. 9
4.2.	Minimum subscription ........................................................................................................... 9
4.3.	Eligible shareholders .............................................................................................................. 9
4.4.	Entitlements of eligible shareholders .................................................................................. 9
4.5.	No rights trading .................................................................................................................. 10
4.6.	Issue of bonus options ........................................................................................................ 10
4.7.	Quotation of bonus options ............................................................................................... 10
4.8.	Withdrawal of the offer ....................................................................................................... 10
5.	PURPOSE AND EFFECT OF THE OFFER ............................................................... 11
5.1.	Purpose of the offer ............................................................................................................. 11
5.2.	Effect of the offer ................................................................................................................ 11
5.3.	Effect on capital structure ................................................................................................... 11
5.4.	Effect on shareholdings ....................................................................................................... 11
5.5.	Effect on control .................................................................................................................. 12
6.	RISK FACTORS .................................................................................................................. 13
6.1.	Introduction .......................................................................................................................... 13
6.2.	Risks specific to the company ............................................................................................ 13
6.3.	Industry-specific risks .......................................................................................................... 17
6.4.	General risks .......................................................................................................................... 19
6.5.	Speculative investment......................................................................................................... 20
7.	ADDITIONAL INFORMATION .................................................................................. 21
7.1.	Bonus option terms and conditions .................................................................................. 21
7.2.	Rights attaching to shares .................................................................................................... 22
7.3.	Continuous disclosure obligations ..................................................................................... 24
7.4.	No determination by ASIC ................................................................................................. 26
7.5.	ASIC instrument ................................................................................................................... 26
7.6.	Directors’ interests ............................................................................................................... 26

7.7.	Directors’ security holdings ................................................................................................ 27
7.8.	Remuneration of directors .................................................................................................. 27
7.9.	Interests of experts and advisors ........................................................................................ 28
7.10.	Consents ................................................................................................................................ 28
7.11.	Litigation ................................................................................................................................ 29
7.12.	Expenses of the offers ......................................................................................................... 29
8.	DIRECTORS’ AUTHORISATION ................................................................................ 30
9.	GLOSSARY .......................................................................................................................... 31

CORPORATE DIRECTORY

directors	John Lester	Non-Executive Chairman
	Frederick Salkanovic	Non-Executive Director
	Lu Ning Yi	Non-Executive Director
	Stephen O’Grady	Non-Executive Director
company secretary	Madhu Bhalla
registered office	71 Furniss Road, Landsdale, WA 6065
telephone	+61 8 6305 0221
email	[email protected]
website	www.classicminerals.com.au

share registry*	Advanced Share Registry Services
	110 Stirling Highway, Nedlands WA 6009
auditor*	Bentleys Audit & Corporate (WA) Pty Ltd
	Level 3, 216 St Georges Terrace,	Perth WA 6000
solicitors to the	Blackwall Legal LLP
company	Level 26, 140 St Georges Terrace, Perth WA 6000
securities exchange	ASX Code: CLZ

These entities are included for information purposes only. They have not been involved in the preparation of the prospectus and have not consented to being named in the prospectus.

2. TIMETABLE

Tuesday, Lodgement of prospectus with ASIC 19 January 2021

Tuesday, Announcement of offer and lodgement of Appendix 3B with ASX 19 January 2021

Tuesday, Notice sent to option holders 19 January 2021

Friday, Shares trade “ex-rights” 22 January 2021

Monday, Record date 25 January 2021

Tuesday, Issue bonus options and apply for quotation 2 February 2021

The above timetable is indicative only and subject to change. Subject to the listing rules , the directors reserve the right to vary these dates, including the record date , without prior notice. Any extension of the record date will have a consequential effect on the anticipated date for issue of the bonus options . The directors also reserve the right not to proceed with the whole or part of the offer at any time prior to allotment.

3. IMPORTANT NOTES

3.1. Lodgement and timing

3.1.1. This prospectus is dated 19 January 2021 and was lodged with ASIC on that date. ASIC, ASX and their respective officers take no responsibility for the contents of this prospectus or the merits of the investment to which this prospectus relates.
3.1.2. No bonus options may be issued on the basis of this prospectus later than 13 months after the date of this prospectus .
3.1.3. Application will be made to ASX within seven days after the date of this prospectus for quotation of the bonus options the subject of the offer .

3.2. Disclaimer

3.2.1. No person is authorised to give information or to make any representation in connection with this prospectus , which is not contained in the prospectus . Any information or representation not so contained may not be relied on as having been authorised by the company in connection with this prospectus .
3.2.2. It is important that investors read this prospectus in its entirety and seek professional advice where necessary. The bonus options the subject of this prospectus should be considered highly speculative. No document or information included on the company’s website is incorporated by reference into this prospectus .

3.3. Continuously quoted securities

In preparing this prospectus , regard has been had to the fact that the company is a “disclosing entity” for the purposes of the Corporations Act and that certain matters may reasonably be expected to be known to investors and their professional advisers. This prospectus is issued pursuant to section 713 of the Corporations Act ; it is intended to be read in conjunction with the publicly available information in relation to the company which has been notified to ASX and does not include all information that would be included in a prospectus for an initial public offering.

3.4. Risks

3.4.1. It is important that investors read this prospectus in its entirety and seek professional advice where necessary. There are risks associated with an investment in the company and the bonus options the subject of the offer should be considered highly speculative.
3.4.2. You should consider the risk factors that could affect the value of an investment in the company , some of which are outlined in Section 6 of the prospectus . The bonus options

offered under this prospectus carry no guarantee with respect to return on investment, payment of dividends or the future value of the bonus options .

3.5. Applications

As the offer involves the issue of bonus options to all shareholders on a pro rata basis for nil consideration, there is no requirement for applications to be submitted to receive bonus options .

3.6. Forward-looking statements

3.6.1. This prospectus may contain forward-looking statements which are identified by words such as ‘may’, ‘could’, ‘believes’, ‘estimates’, ‘targets’, ‘expects’, or ‘intends’ and other similar words that involve risks and uncertainties.
3.6.2. 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 expected to take place.
3.6.3. 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 management.
3.6.4. 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 prospectus will actually occur and investors are cautioned not to place undue reliance on these forward-looking statements.
3.6.5. We 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 our actual results to differ materially from the results expressed or anticipated in these statements. These risk factors are set out in Section 6 .

3.7. Overseas shareholders

3.7.1. 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 may be restricted by law and persons who come into possession of this prospectus should seek advice on and observe any such restrictions. Any failure to comply with these restrictions may constitute a violation of applicable securities law.
3.7.2. The offer contained in this prospectus to shareholders with registered addresses in New Zealand is made in reliance on the Securities Act (Overseas Companies) Exemption Notice

2013 (New Zealand). This prospectus is not an investment statement or offer document under New Zealand law, and may not contain all the information that an investment statement or offer document under New Zealand law is required to contain.
3.8. Taxation 3.8.1. It is the responsibility of all persons to satisfy themselves of the taxation treatment that applies to them in relation to the offer , by consulting their own professional tax advisers. Neither the company nor any of its directors or officers accepts any liability or responsibility in respect of the taxation consequences of the matters referred to above.
3.9. Privacy 3.9.1. If you complete an application for shares , you will be providing personal information to the company (directly or through the company’s share registry). The company collects, holds and will use that information to assess your application, service your needs as a holder of securities in the company , facilitate distribution payments and corporate communications to you as a shareholder, and carry out administration.
3.9.2. The information may also be used from time to time and disclosed to persons inspecting the company’s securities registers, 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 company’s share registry.
3.9.3. You can access, correct and update the personal information that we hold about you. Please contact the company or its share registry if you wish to do so at the relevant contact numbers set out in this prospectus .
3.9.4. 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 settlement operating rules . You should note that if you do not provide the information required on the application for shares , the company may not be able to process or accept your application.
3.10. Speculative investment 3.10.1. An investment in shares issued on exercise of the bonus options offered under this prospectus should be considered highly speculative. Refer to Section 6 for details of the key risks applicable to an investment in the company .
3.10.2. There is no guarantee that shares issued on exercise of the bonus options offered under this prospectus will make a return on the capital invested, that dividends will be paid on shares issued on exercise of bonus options , or that there will be an increase in the value of the bonus options in the future.

3.11. Other matters

3.11.1. All financial amounts in this prospectus are expressed as Australian dollars unless otherwise stated. Any discrepancies between totals and sums and components in tables contained in this prospectus are due to rounding.
3.11.2. Defined terms and abbreviations italicised in this prospectus are detailed in the glossary in Section 9 .

3.12. Enquiries

If you are in any doubt as to how to deal with any of the matters raised in this prospectus , you should consult with your broker, or legal, financial or other professional adviser without delay.

4. DETAILS OF THE OFFER

4.1. Summary

4.1.1. The offer is a pro rata bonus issue of approximately 4.26 billion bonus options for nil consideration. No funds will be raised under the offer.
4.1.2. Eligible shareholders will be issued one (1) bonus option for every four (4) shares held by them at 5.00pm WST on the record date .
4.1.3. All of the bonus options offered under this prospectus will be issued on the terms and conditions set out in Section 7.1 .

4.2. Minimum subscription

The is no minimum subscription.

4.3. Eligible shareholders

4.3.1. The offer is being made to those shareholders who:
(a) are registered as a holder of shares as at the record date ;
(b) have a registered address in Australia or New Zealand; and
(c) are eligible under all applicable securities laws to receive an offer under the offer ,

( eligible shareholders ).

4.3.2. The company is of the view that it is unreasonable to make offers under the offer to shareholders outside of Australia and New Zealand having regard to:
(a) the relatively small number of shareholders outside of Australia and New Zealand as a proportion of all shareholders ;
(b) the number and value of the bonus options to be offered to shareholders outside of Australia and New Zealand; and
(c) the cost of complying with the legal requirements of regulatory authorities in the overseas jurisdictions.

4.4. Entitlements of eligible shareholders

’
4.4.1. In calculating each eligible shareholder s entitlement, fractional entitlements to bonus options have been rounded up to the nearest whole number of bonus options .

4.5. No rights trading

The rights to bonus options under the offer are non-renounceable. Eligible shareholders may not sell or transfer any part of their entitlements.

4.6. Issue of bonus options

Bonus options issued pursuant to the offer will be issued in accordance with the listing rules and the timetable set out at in Section 2.

4.7. Quotation of bonus options

4.7.1. Application for quotation of the bonus options issued pursuant to this prospectus will be made in accordance with the timetable set out in Section 2 . However, the bonus options will remain unquoted until such time as the company satisfies the quotation requirements.
4.7.2. The company anticipates that quotation will occur soon after issue of the bonus options . If ASX does not grant official quotation of the bonus options before the expiration of 3 months after the date of issue of the prospectus (or such period as varied by ASIC ) any bonus options issued will be void in accordance with section 723(3) of the Corporations Act .
4.7.3. The fact that ASX may grant quotation to the bonus options is not to be taken in any way as an indication of the merits of the company or the bonus options now offered.

4.8. Withdrawal of the offer

The company reserves the right to withdraw all or part of the offer , and this prospectus , at any time, subject to applicable laws.

5. PURPOSE AND EFFECT OF THE OFFER

5.1. Purpose of the offer

5.1.1. The purpose of the offer is to reward shareholders for supporting the company and to provide the company with a potential source of additional capital if bonus options are exercised. No funds will be raised through the issue of the bonus options , however if all the bonus options are exercised (at an exercise price of $0.003), the company will receive approximately $12.5 million.

5.2. Effect of the offer

The principal effect of the offer , assuming no options are exercised and converted into shares between the date of this prospectus and the record date , will be to increase the number of options on issue from 1,252,134,396 options as at the date of this prospectus to 5,435,876,473 options immediately after completion of the offer .

5.3. Effect on capital structure

5.3.1.

As at the date of this prospectus, the company has on issue:
(a) 17,034,968,306 shares ; and
(b) 1,252,134,396 options exercisable at various exercise prices and expiring on various exercise dates;
5.3.2. The effect of the offer on the capital structure of the company , assuming no options are exercised between the date of this prospectus and the record date , is set out below.

	ordinary shares	options
currently on issue	17,034,968,306	1,252,134,396
offer	-	4,258,742,077
total after offer	17,034,968,306	5,510,876,473

5.4. Effect on shareholdings

The issue of bonus options under the offer will not have the effect of diluting the percentage shareholdings of shareholders unless and until holders of bonus options exercise those options . Any dilution of shareholders on exercise of bonus options will be dependent on the extent to which those shareholders exercise their bonus options .

5.5. Effect on control

5.5.1. The issue of bonus options will have no impact on any shareholder’s voting power.
5.5.2. The company does not believe that any shareholder , on exercising bonus options , will materially increase their percentage shareholding in the company to the extent that the shareholder’s voting power in the company would increase from 20% or below to more than 20%.

6. RISK FACTORS

6.1. Introduction

6.1.1. Any shares issued on exercise of bonus options offered under this prospectus are considered highly speculative. An investment in the company is not risk free and the directors strongly recommend potential investors to consider the risk factors described below, together with information contained elsewhere in this prospectus and to consult their professional advisors before deciding whether to apply for new shares pursuant to this prospectus .

6.1.2. There are specific risks which relate directly to the company’s business. In addition, there are other general risks, many of which are largely beyond the control of the company and the directors . The risks identified in this Section , or other risk factors, may have a material impact on the financial performance of the company and the market price of shares .

6.1.3. The following is not intended to be an exhaustive list of the risk factors to which the company is exposed.

6.2. Risks specific to the company

6.2.1. Limited operating history

The company is an early-stage exploration company, does not have a significant operating history and there is no assurance that future operations will result in revenues or profits. If sufficient revenues to operate profitably cannot be generated, operations may be suspended or cease.

The company will be subject to all of the business risks and uncertainties associated with any new business enterprise. There can be no assurance that demand for the company’s products will be as anticipated, or that the business will become profitable. Consequently, there can be no forecast or confirmation as to the company’s future performance following completion of the offer .

6.2.2. Exploration and development risks

Mineral exploration and development is a speculative and high-risk undertaking that may be impeded by circumstances and factors beyond the control of the company . Success in this process involves, among other things:

(a) discovery and proving-up, or acquiring, economically recoverable resources or reserves;

(b) access to adequate capital throughout the exploration, discovery and project development phases;
(c) securing and maintaining title to mineral exploration projects;
(d) obtaining required development consents and approvals necessary for the acquisition, mineral exploration, development and production phases; and
(e) accessing the necessary experienced operational staff, the applicable financial management and recruiting skilled contractors, consultants and employees.

As the company is an early-stage exploration company, there can be no assurance that exploration on its projects, or any other exploration properties that may be acquired in the future, will result in the discovery of an economic mineral resource. Even if an apparently viable mineral resource is identified, there is no guarantee that it can be economically exploited.

The future exploration activities of the company may be affected by a range of factors including geological conditions, limitations on activities due to seasonal weather patterns, unanticipated operational and technical difficulties, industrial and environmental accidents, changing government regulations and many other factors beyond the control of the company .

6.2.3. Tenement grant and maintenance risks

The company’s mining exploration activities are dependent upon the grant, or as the case may be, the maintenance of appropriate licences, concessions, leases, permits and regulatory consents which may be withdrawn or made subject to limitations. The maintaining of tenements, obtaining renewals, or getting tenements granted, often depends on the company being successful in obtaining the required statutory approvals for its proposed activities and that the licences, concessions, leases, permits or consents it holds will be renewed as and when required. There is no assurance that such renewals will be given as a matter of course and there is no assurance that new conditions will not be imposed in connection therewith.

6.2.4. Agents & contractors

The company outsources substantial parts of its exploration activities pursuant to services contracts with third-party contractors. The directors are unable to predict the risk of financial failure or default of the insolvency of any of the contractors that will be used by the company in any of its activities or other managerial failure by any of the other service providers used by the company for any activity. Contractors may also underperform their obligations of their contract, and in the event that their contract is terminated, the company may not be able to find a suitable replacement on satisfactory terms.

6.2.5. Operational risks

The operations of the company may be affected by various factors, including:

(a) failure to locate or identify mineral deposits;
(b) failure to achieve predicted grades in exploration and mining;
(c) operational and technical difficulties encountered in mining;
(d) insufficient or unreliable infrastructure, such as power, water and transport;
(e) difficulties in commissioning and operating plant and equipment;
(f) mechanical failure or plant breakdown;
(g) unanticipated metallurgical problems which may affect extraction costs; and
(h) adverse weather conditions.

In the event that any of these potential risks eventuate, the company’s operational and financial performance may be adversely affected.

6.2.6. Conditions to tenements

Interests in mining tenements in Western Australia are governed by legislation and are evidenced by the granting of leases and licences by the State. The company is subject to the Mining Act 1978 (WA) and the company has an obligation to meet conditions that apply to the tenements , including the payment of rent and prescribed annual expenditure commitments.

The tenements held by the company are subject to annual review and periodic renewal. While it is the company’s intention to satisfy the conditions that apply to the tenements , there can be no guarantees made that, in the future, the tenements that are subject to renewal will be renewed or that minimum expenditure and other conditions that apply to the tenements will be satisfied. Renewal conditions may include increased expenditure and work commitments or compulsory relinquishment of areas of the tenements comprising the projects . These events could have a materially adverse effect on the company’s prospects and the value of its assets.

If a tenement holder fails to comply with the terms and conditions of a tenement, the Warden or Minister (as applicable) may impose a fine or order that the tenement be forfeited. In most cases an order for forfeiture can only be made where the breach is of sufficient gravity to justify forfeiture of the tenement. In certain cases, a third party can institute administrative proceedings under the Mining Act before the Warden seeks forfeiture of the tenement.

6.2.7. Crown land

The land subject to the tenements may overlap with Crown land, including pastoral leases. Upon commencing mining operations on any of the tenements , the company may need to consider entering into a compensation and access agreement with the lease holders to ensure the requirements of the Mining Act 1978 (WA) are satisfied and to avoid any disputes arising. In the absence of agreement, the Warden’s Court

determines compensation payable. The entry into these agreements may delay the undertaking of activities, including the development of any future mines, and may mean that the company cannot explore all areas that it may prefer to explore for mineral development.

6.2.8. Grant of future authorisations to explore and mine

If the company discovers an economically viable mineral deposit that it then intends to develop, it will, among other things, require various approvals, licences and permits before it will be able to mine the deposit. There is no guarantee that the company will be able to obtain all required approvals, licences and permits. To the extent that required authorisations are not obtained or are delayed, the company’s operational and financial performance may be materially adversely affected.

6.2.9. Native title and heritage matters

In relation to tenements which the company has an interest in or will in the future acquire such an interest, there may be areas over which legitimate common law native title rights of Aboriginal Australians exist. If native title rights do exist, the ability of the company to gain access to tenements (through obtaining consent of any relevant landowner), or to progress from the exploration phase to the development and mining phases of operations may be adversely affected.

The directors will closely monitor the potential effect of native title claims involving tenements in which the company has or may have an interest.

6.2.10. Requirement for additional capital

Additional funding may be required in the event costs exceed the company’s estimates and to effectively implement its business and operational plans in the future to take advantage of opportunities for acquisitions, joint ventures or other business opportunities, and to meet any unanticipated liabilities or expenses which the company may incur. If such events occur, additional funding will be required.

The company may seek to raise further funds through equity or debt financing, joint ventures, licensing arrangements, or other means. Failure to obtain sufficient financing for the company’s activities and future projects may result in delay and indefinite postponement of these activities and potential development programmes. There can be no assurance that additional finance will be available when needed or, if available, the terms of the financing may not be favourable to the company and might involve substantial dilution to shareholders .

6.2.11. Retention of key personnel

There is a risk that, where there is a turnover of development staff who have knowledge of the mineral tenements and the business, knowledge will be lost in the event that those staff resign or retire. This involves the risk that those staff will have information in respect of the company’s activities which has a commercial value to the

company as well as an opportunity cost for replacement of those staff and subsequent training.

6.3. Industry-specific risks

6.3.1. Contamination risks

The mineral exploration sector operates under Australian state and federal environmental laws. The company’s operations may use hazardous materials and produce hazardous waste which may have an adverse impact on the environment or cause exposure to hazardous materials. Despite efforts to conduct its activities in an environmentally responsible manner and in accordance with all applicable laws, the company may be subject to claims for toxic torts, natural resources damages and other damages. In addition, the company may be subject to the investigation and clean-up of contaminated soil, surface water and groundwater. This may delay the timetable of the company’s projects and may subject the company to substantial penalties including fines, damages, clean-up costs or other penalties. The company is also subject to environmental protection legislation, which may affect the company’s access to certain areas of its properties and could result in unforeseen expenses and areas of moratorium.

6.3.2. Metallurgy risk

When compared with many industrial and commercial operations, mining exploration projects are high risk. Each ore body is unique and the nature of the mineralisation, the occurrence and grade of the ore, as well as its behaviour during mining can never be wholly predicted. Estimations of a mineral deposit are not precise calculations although are based on interpretation and on samples from drilling which represent a very small sample of the entire ore body. Reconciliation of past production and reserves, where available, can confirm the reasonableness of past estimates, but cannot categorically confirm accuracy of future projections. The applications of metallurgical test work results and conclusions to the process design, recoveries and throughput depend on the accuracy of the test work and assumption that the sample tests are representative of the ore body as a whole. There is a risk associated with the scale-up of laboratory and pilot plant results to a commercial scale and with the subsequent design and construction of any plant. 6.3.3. Resource and reserve estimates Resource and reserve estimates are expressions of judgement based on knowledge, experience and industry practice. Estimates which were valid when initially calculated may alter significantly when new information or techniques become available. In addition, by their very nature, resource and reserve estimates are imprecise and depend to some extent on interpretation which may prove to be inaccurate.

6.3.4. Land access

There is a substantial level of regulation and restriction on the ability of exploration and mining companies to have access to land in Australia. Negotiations with both Native Title and landowners/occupiers are generally required before the company can access land for exploration or mining activities. Inability to access, or delays experienced in accessing, the land may impact on the company’s activities.

6.3.5. Environmental risks

The operations and proposed activities of the company are subject to state and federal environmental laws and regulations. As with most exploration projects and mining operations, the company's activities are expected to have an impact on the environment, particularly if advanced exploration or mine development proceeds. The company will attempt to conduct its activities to the highest standard of environmental obligation, including compliance with all environmental laws.

6.3.6. Environmental impact constraints

The company's exploration programs will, in general, be subject to approval by governmental authorities. Development of any of the company's properties will be dependent on the relevant project meeting environmental guidelines and, where required, being approved by governmental authorities.

6.3.7. Climate change regulation

Mining of mineral resources is relatively energy intensive and is dependent on the consumption of fossil fuels. Increased regulation and government policy designed to mitigate climate change may adversely affect the company’s cost of operations and adversely impact the financial performance of the company .

6.3.8. Insurance risks

Insurance coverage of all risks associated with minerals exploration, development and production is not always available and, where available, the cost can be high. The company will have insurance in place considered appropriate for the company’s needs. The company will not be insured against all possible losses, either because of the unavailability of cover or because the directors believe the premiums are excessive relative to the benefits that would accrue. The directors believe the insurance they have in place is appropriate. The directors will continue to review the insurance cover in place to ensure that it is adequate. 6.3.9. Safety Safety is a fundamental risk for any exploration and production company in relation to personal injury, damage to property and equipment and other losses. The occurrence of any of these risks could result in legal proceedings against the company and/or key personnel and substantial losses to the company due to injury or loss of life, damage or destruction of property, regulatory investigation, and penalties or

suspension of operations. Damage occurring to third parties because of such risks may give rise to claims against the company .

6.4. General risks

6.4.1. Market conditions

Share market conditions may affect the value of the company’s quoted securities regardless of the company’s operating performance. Share market conditions are affected by many factors such as:

(c) general economic outlook;
(a) introduction of tax reform or other new legislation;
(b) interest rates and inflation rates;
(c) changes in investor sentiment toward particular market sectors;
(d) the demand for, and supply of, capital; and
(e) terrorism or other hostilities.

The market price of securities can fall as well as rise and may be subject to varied and unpredictable influences on the market for equities in general and technology stocks in particular. Neither the company nor the directors warrant the future performance of the company or any return on an investment in the company .

6.4.2. Commodity and exchange rate fluctuation risk

To the extent the company may become involved in mineral production, the revenue derived through the sale of commodities may expose the potential income of the company to commodity price and exchange rate risks. Commodity prices fluctuate and are affected by many factors beyond the control of the company . Such factors include supply and demand fluctuations for precious and base metals, technological advancements, forward selling activities and other macro-economic factors.

6.4.3. Economic and government risk

The future viability of the company is also dependent on a number of other factors affecting performance of all industries and not just the technology industry including, but not limited to, the following:

(d) general economic conditions in jurisdictions in which the company operates;
(a) changes in government policies, taxation and other laws in jurisdictions in which the company operates;
(b) the strength of the equity markets in Australia and throughout the world, and in particular investor sentiment towards the technology sector;

(c) movement in, or outlook on, interest rates and inflation rates in jurisdictions in which the company operates; and
(d) natural disasters, social upheaval or war in jurisdictions in which the company operates.

6.4.4. COVID-19

The outbreak of the COVID-19 pandemic 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. The company’s share price may be adversely affected 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 the subject of 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 .

6.5. Speculative investment

6.5.1. The above list of risk factors ought not to be taken as exhaustive of the risks faced by the company or by investors 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 shares offered under this prospectus .

6.5.2. Therefore, the new shares 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 new shares . Potential investors should consider that the investment in the company is highly speculative and should consult their professional advisors before deciding whether to apply for new shares pursuant to this prospectus .

7. ADDITIONAL INFORMATION

7.1. Bonus option terms and conditions

The following are the terms and conditions of the bonus options :

(a) ( entitlement ) each bonus option will entitle the holder to subscribe for one share . All shares issued upon the exercise of bonus options will rank equally in all respects with the company's existing shares ;
(b) ( exercise price ) each bonus option shall entitle the holder to acquire one share upon payment of the sum of $0.003 per bonus option ( exercise price ) to the company ;
(c) ( exercise of options ) the bonus options will expire at 5.00pm WST on the date which is 3 years after their issue ( expiry date ). The bonus options may be exercised, in whole or in part, at any time prior to the expiry date , by completing and delivering a duly completed form of notice of exercise to the registered office of the company together with the payment of the exercise price in immediately available funds for the number of shares in respect of which the bonus options are exercised. A bonus option not exercised on or before the expiry date will lapse. Shares issued pursuant to the exercise of director options will be issued, and a holding statement or share certificate provided to the holders of director options in respect of those shares , on the above terms and conditions not more than 15 business days after the receipt of a duly completed form of notice of exercise and the exercise price ;
(d) ( quotation of bonus options ) application will be made to ASX for quotation of the bonus options ;
(e) ( quotation of shares ) provided the company is listed on ASX at the time, application will be made for quotation of shares issued on exercise of bonus options not later than 15 business days after the date of issue. If required, the company will give ASX a notice that complies with section 708A(5)(e) of the Corporations Act , or, if such a notice delivered is for any reason not effective to ensure that an offer for sale of the shares does not require disclosure to investors, the company must, no later than 20 business days after becoming aware of such notice being ineffective, lodge with ASIC a prospectus prepared in accordance with the Corporations Act and do all such things necessary to satisfy section 708A(11) of the Corporations Act to ensure that an offer for sale of the shares does not require disclosure to investors;
(f) ( transfer ) The bonus options are transferable subject to any restrictions imposed by ASX or under applicable Australian securities laws;

(g) ( participation and entitlements ) there are no participating rights or entitlements inherent in the bonus options and holders will not be entitled to participate in new issues of securities offered to shareholders during the currency of the bonus options . However, the company must give notice to the holders of bonus options of any new issue before the record date for determining entitlements to the issue in accordance with the listing rules so as to give holders the opportunity to exercise their bonus options before the date for determining entitlements to participate in any issue;
(h) ( reorganisation of share capital ) in the event of a reorganisation (including consolidation, subdivision, reduction or return) of the issued capital of the company , all rights of holders of bonus options shall be changed to the extent necessary to comply with the Corporations Act and the listing rules applying to a reorganisation of capital at the time of the reorganisation; and
(i) ( bonus issue ) if, from time to time, before the expiry of the bonus options the company makes a pro-rata issue of shares to shareholders for no consideration, the number of shares over which a bonus option is exercisable will be increased by the number of shares which the holder would have received if the bonus options had been exercised before the date for calculating entitlements to the pro-rata issue.

7.2. Rights attaching to shares

7.2.1. The following is a summary of the more significant rights and liabilities attaching to shares, being the underlying securities to the bonus options offered pursuant to this prospectus . This summary is not exhaustive and does not constitute a definitive statement of the rights and liabilities of shareholders . To obtain such a statement, persons should seek independent legal advice. Full details of the rights and liabilities attaching to shares are set out in the constitution , a copy of which is available for inspection at the company’s registered office during normal business hours.
7.2.2. General meetings
(a) Shareholders are entitled to be present in person, or by proxy, attorney or representative to attend and vote at general meetings of the company .
(b) Shareholders may requisition meetings in accordance with section 249D of the Corporations Act and the constitution .
7.2.3.
Voting rights
(a) Subject to the constitution and to any rights and restrictions attaching to any class of shares, at meetings of shareholders or other classes of shareholder , each shareholder entitled to attend and vote may attend and vote in person or by proxy or by attorney and, where the shareholder is a body corporate, by representative.

(b) On a show of hands every shareholder present having the right to vote at the meeting has one vote. On a poll, every shareholder present has one vote for each fully paid share and, the case of partly paid shares or share held by the shareholder , a fraction of a vote equivalent to the proportion which the amount paid (but not credited) is of the total amounts paid and payable (excluding amounts credited) on the share or shares held.
7.2.4. Dividend rights

Subject to the Corporations Act and to any special rights or restrictions attached to any shares , directors may from time to time authorise the company to pay interim and final dividends which appear to the directors to be justified by the profits of the company .

7.2.5. Winding-up

If the company is wound up, the liquidator may, with the authority of a special resolution, divide among the shareholders in kind the whole or any part of the property of the company , and may for that purpose set such value as he considers fair upon any property to be so divided, and may determine how the division is to be carried out as between the shareholders or different classes of shareholders .

7.2.6. Transfer of shares

Generally, shares are freely transferable, subject to formal requirements, the registration of the transfer not resulting in a contravention of or failure to observe the provisions of a law of Australia and the transfer not being in breach of the Corporations Act and the listing rules .

7.2.7. Future increase in capital

The issue of any shares is under the control of the directors . Subject to restrictions on the issue or grant of securities contained in the listing rules , the constitution and the Corporations Act (and without affecting any special right previously conferred on the holder of an existing share or class of shares ), the directors may issue shares as they shall, in their absolute discretion, determine.

7.2.8. Variation of rights

(a) Under section 246B of the Corporations Act , the company may, with the sanction of a special resolution passed at a meeting of shareholders, vary or abrogate the rights attaching to shares .
(b) If at any time the share capital is divided into different classes of shares, the rights attached to any class (unless otherwise provided by the terms of issue of the shares of that class), whether or not the company is being wound up, may be varied or abrogated with the consent in writing of the holders of three quarters of the issued shares of that class, or if authorised by a special resolution passed at a separate meeting of the holders of the shares of that class.

7.3. Continuous disclosure obligations

7.3.1. The company is a “disclosing entity” (as defined in section 111AC of the Corporations Act ) for the purposes of section 713 of the Corporations Act and, as such, is subject to regular reporting and disclosure obligations. Specifically, as a listed company, the company is required to continuously disclose any information it has to the market which a reasonable person would expect to have a material effect on the price or the value of the company’s securities .
7.3.2. This prospectus is a “transaction specific prospectus” to which the special content rules under section 713 of the Corporations Act apply. That provision allows the issue of a more concise prospectus in relation to an offer of securities in a class which has been continuously quoted by ASX in the three months prior to the date of the prospectus. In general terms, “transaction specific prospectuses” are only required to contain information in relation to the effect of the issue of securities on the entity and the rights attaching to those securities . It is not necessary to include general information in relation to all of the assets and liabilities, the financial position, profits and losses or prospects of the issuing company.
7.3.3. This prospectus is intended to be read in conjunction with the publicly available information in relation to the company which has been notified to ASX and does not include all of the information that would be included in a prospectus for an initial public offer of securities in an entity that is not already listed on a stock exchange. Investors should therefore have regard to the other publicly available information in relation to the company before deciding whether or not to invest.
7.3.4. The company believes that it has complied with the general and specific requirements of ASX as applicable from time to time throughout the 3 months before the issue of this prospectus which required the company 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 .
7.3.5. Information that is already in the public domain has not been reported in this prospectus other than that which is considered necessary to make this prospectus complete.
7.3.6. The company , as a disclosing entity under the Corporations Act , states that: (a) it is subject to regular reporting and disclosure obligations; (b) copies of documents lodged with ASIC in relation to the company (not being documents referred to in section 1274(2)(a) of the Corporations Act ) may be obtained from, or inspected at, the offices of ASIC ; and
(c) it will provide a copy of each of the following documents, free of charge, to any person on request between the date of issue of this prospectus and the record date :

(i) the annual financial report of the company for the financial year ended 30 June 2020 being the most recent annual financial report of the company lodged with ASIC before the issue of this prospectus ; and
(ii) any documents used to notify ASX of information relating to the company in the period from lodgement of the annual financial report referred to in paragraph (i) above until the issue of this prospectus in accordance with the listing rules as referred to in section 674(1) of the Corporations Act .

Copies of all documents lodged with ASIC in relation to the company can be inspected at the registered office of the company during normal office hours.

The company has lodged the following announcements with ASX since the lodgement of its 2020 annual report on 17 September 2020:

Date	Description of ASX announcement
18 January 2018	Appendix 2A and Cleansing Statement
18 January 2018	Proposed Issue of Securities – CLZ
31 December 2020	Expiry of Performance Rights
30 December 2020	Appendix 2A and Cleansing Statement
30 December 2020	Proposed Issue of Securities – CLZ
30 December 2020	Results of Meeting
8 December 2020	September 2020 Quarterly Activities Report – Amended
26 November 2020	Notice of General Meeting / Proxy Form
26 November 2020	Update on Mining Lease Application – Objection Withdrawn
20 November 2020	Appendix 2A and Cleansing Statement
20 November 2020	Proposed Issue of Securities – CLZ
20 November 2020	Classic Placement Completed - Oversubscribed
20 November 2020	Loyalty Options for Classic Shareholders
18 November 2020	Trading Halt
18 November 2020	Pause in Trading
16 November 2020	Results of Meeting
2 November 2020	Quarterly Activities and Cashflow Report

27 October 2020	Investor Presentation
20 October 2020	Infill Drilling Delivers High Grade Au Intercepts at Kat Gap
19 October 2020	Corporate Governance Statement
19 October 2020	Notice of Annual General Meeting / Proxy Form
6 October 2020	Appendix 2A and Cleansing Statement
6 October 2020	Proposed Issue of Securities – CLZ
5 October 2020	Results of Meeting
29 September 2020	Update on Gekko Plant
17 September 2020	Appendix 4G

7.4. No determination by ASIC

ASIC has not made a determination which would prevent the company from relying on section 713 of the Corporations Act in issuing the bonus options under this prospectus .

7.5. ASIC instrument

The offer is made in accordance with ASIC Corporations (Application Form Requirements) Instrument 2017/241 which exempts the company from complying with section 723(1) of the Corporations Act to the extent that that section would only permit an issue of bonus options in response to an application form included in or accompanied by a disclosure document.

7.6. Directors’ interests

Other than as set out in this prospectus , no director or proposed director holds, or has held within the 2 years preceding lodgement of this prospectus with ASIC , any interest in:

(a) the formation or promotion of the company ;
(b) any property acquired or proposed to be acquired by the company in connection with:

(i) its formation or promotion; or

(ii) the offer ; or
(c) the offer ,

and no amounts have been paid or agreed to be paid and no benefits have been given or agreed to be given to a director or proposed director :

(d) as an inducement to become, or to qualify as, a director ; or
(e) for services provided in connection with:
(i) the formation or promotion of the company ; or
(ii) the offer .

7.7. Directors’ security holdings

7.7.1. As at the date of the prospectus , the directors hold the following interests in securities of the company :

	John Lester	Frederick	Lu Ning Yi	Stephen O’Grady
		Salkanovic
shares held	54,750,000	56,875,000	71,293,415	-
options held	-	-	-	-
bonus options	13,687,500	14,218,750	17,823,353	-
entitlement

7.8. Remuneration of directors

7.8.1. The constitution provides that the non-executive directors may be paid, in aggregate for their services as directors , a sum not exceeding such fixed sum per annum as may be determined by the company in general meeting. 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 nonexecutive director . The current aggregate sum has been set at an amount not to exceed $350,000 per annum.
7.8.2. The remuneration of executive directors is decided by the board , without the affected executive director participating in that decision-making process and may be paid by way of fixed salary or commission.
7.8.3. Directors may also be reimbursed for all reasonable expenses incurred in the course of conducting their duties which include, but are not in any way limited to, out of pocket expenses, travelling expenses, disbursements made on behalf of the company and other miscellaneous expenses.
7.8.4. The non-executive directors have each executed an agreement with the company entitling them to remuneration in their capacities as directors .

7.8.5. The remuneration (including superannuation) of the directors for the year ended 30 June 2021 will be as follows:

	John Lester	Frederick	Lu Ning Yi	Stephen O’Grady
		Salkanovic
remuneration	60,000	40,000	40,000	40,000

7.9. Interests of experts and advisors

7.9.1. Other than as set out below or elsewhere in this prospectus , no promoter of the company or person named in this prospectus as performing a function in a professional, advisory or other capacity in connection with the preparation or distribution of this prospectus has, or had within the 2 years preceding lodgement of this prospectus with ASIC, any interest in:
(a) the formation or promotion of the company ;
(b) any property acquired or proposed to be acquired by the company in connection with its formation or promotion or in connection with the offer ,

and no amounts have been paid or agreed to be paid and no benefits have been given or agreed to be given to any of these persons for services provided in connection with the formation or promotion of the company or the offer .

7.9.2. Blackwall Legal LLP has acted as the company’s solicitors in relation to the offer. The company estimates it will pay Blackwall Legal LLP approximately $5,000 (excluding GST and disbursements) for these services. Blackwall Legal LLP has been paid approx. $57,000 (excluding GST and disbursements) for other professional services provided to the company during the 2 years prior to the lodgement of this prospectus with ASIC .

7.10. Consents

7.10.1. Chapter 6D of the Corporations act imposes a liability regime on the company (as the offeror of the securities ), the directors , the persons named in the prospectus with their consent as incoming directors, any underwriters, persons named in the prospectus with their consent having made a statement in the prospectus and persons involved in a contravention in relation to the prospectus . Although the company bears primary responsibility for the prospectus , the other parties involved in the preparation of the prospectus can also be responsible for certain statements in it.
7.10.2. Other than as set out below, each of the parties referred to in this section :
(a) has not authorised or caused the issue of this prospectus ;

(b) does not make, or purport to make, any statement in this prospectus other than those referred to in Section 7.3 ;
(c) to the maximum extent permitted by law, expressly disclaim and take no responsibility for any part of this prospectus other than a reference to its name and a statement included in this prospectus in Section 7.3 with the consent of that party; and
(d) was not involved in the preparation of this prospectus or any part of it except where expressly attributed to that person.
7.10.3. Blackwall Legal LLP has given its written consent to being named as the solicitors to the company in this prospectus . Blackwall Legal LLP has not withdrawn its consent prior to the lodgement of this prospectus with ASIC .

7.11. Litigation

As far as the directors are aware, there are no current or threatened civil litigation, arbitration proceeding or administrative actions, or criminal prosecutions in which the company is directly or indirectly concerned which are likely to have a material adverse effect on the business or financial position of the company.

7.12. Expenses of the offers

In the event that the offer is fully subscribed, the total expenses of the offer are estimated to be approximately $60,000 (excluding GST) and are expected to be applied towards the items set out in the table below:

	$
ASIC fees	3,206
ASX listing fees	13,200
legal fees	5,000
miscellaneous	3,594
total	25,000

8. DIRECTORS’ AUTHORISATION

This prospectus is issued by the company and its issue has been authorised by a resolution of the directors . In accordance with section 720 of the Corporations Act , each director has consented to the lodgement of this prospectus with ASIC .

John Lester Director

for and on behalf of Classic Minerals Limited

9. GLOSSARY

In this prospectus , unless the context otherwise requires, the following terms have the following meanings:

ASIC the Australian Securities and Investments Commission.

ASX ASX Limited ACN 008 624 691, or where the context requires, the Australian Securities Exchange which it runs.

board the board of directors .

bonus option an option offered under this prospectus .

business day a day (other than a Saturday or a Sunday) on which banks in Perth, Western Australia are open for business.

CHESS ASX’s Clearing House Electronic Subregistry System.

company, Classic Classic Minerals Limited ACN 119 484 016, a public company incorporated or CLZ and existing in Australia and listed on ASX (ASX: CLZ).

company the secretary of the company , Mr Madhu Bhalla. secretary

constitution the constitution of the company from time to time. Corporations Act the Corporations Act 2001 (Cth).

director a director of the company .

dollar , $ , A$ or the lawful currency for the time being of the Commonwealth of Australia. AUD

eligible has the meaning given to that term in Section 4.3.1 . shareholder

glossary this glossary of terms.

issuer sponsored securities issued by an issuer that are held in uncertificated form without the holder entering into a sponsorship agreement with a broker or without the holder being admitted as an institutional participant in CHESS .

listing rules the official listing rules of ASX from time to time.

offer the offer to eligible shareholders under this prospectus , as set out in Section 4.1 .

option	an option to acquire a_share_.
prospectus	this prospectus dated 19 January 2021.
quotation	has the meaning given to that term in the_listing rules_.
record date	5.00pm_WST_on the date specified in the_timetable_on page 4 of this_prospectus_.
Section	a section of this_prospectus_.
securities	has the meaning given to that term in section 92 of the_Corporations Act_.
settlement	the settlement rules of the securities clearing house which operates_CHESS_.
operating rules
share	a fully paid ordinary share in the capital of the_company_.
share registry	the_company’s_share registry, being Security Transfer Registrars.
shareholder	a holder of_shares_.
timetable	the timetable of key events and dates set out on page 4 of this_prospectus_.
WST	Western Standard Time, being the time in Perth, Western Australia.