CONICO LTD — Capital/Financing Update 2020

Dec 21, 2020

Tuesday, 22 December 2020

CLEANSING NOTICE

This notice is given by Conico Ltd ( Conico or Company ) under section 708AA(2)(f) of the Corporations Act 2001 (the Act ).

Overview

Conico is undertaking a non-renounceable pro-rata rights offer to Conico shareholders (the Offer ). The terms of the Offer are as follows:

1. The Offer is open to all Conico shareholders who are on the register as at 5.00pm WST on 7 January 2021 (the Record Date ) and who have registered addresses in Australia or New Zealand ( Eligible Shareholders ).

2. Conico shareholders with registered addresses outside of Australia and New Zealand ( Non-Resident Shareholders ) are not entitled to participate in the Offer. Conico has determined, in accordance with the Act and Rule 7.7 of the Listing Rules of ASX Limited (the Rules ) that it would be unreasonable to make the Offer to Non-Resident Shareholders having regard to the number of Non-Resident Shareholders in each country other than Australia and New Zealand, the number and value of the Shares that would be offered to them and the cost of complying with the laws, and any requirements of any regulatory authorities, in countries other than Australia and New Zealand.

3. Under the Offer each Eligible Shareholder will be entitled to be issued with one (1) new fully paid ordinary Conico share ( Share ) for every ten (10) Shares held by them as at the Record Date at a price of $0.03 per Share.

4. The rights of Eligible Shareholders under the Offer are non-renounceable.

5. The Offer is fully underwritten by Peloton Capital Pty Ltd (“Underwriter”).

• The Offer, if fully subscribed, will raise approximately $2,269,296 and will result in the issue of approximately 75,643,232 new Shares.

The Offer is being made without disclosure to investors under Part 6D.2 of the Act. The Offer is being made in accordance with section 708AA of the Act, and does not therefore require disclosure under a disclosure document. Conico is satisfied that it is entitled to rely on section 708AA of the Act.

As at the date of this notice, Conico has complied with:

1. the provisions of Chapter 2M of the Act as they apply to Conico; and

2. section 674 of the Act.

As at the date of this notice, there is no excluded information as described in section 708AA(8) and (9) of the Act.

Rights and liabilities attaching to the Shares

The Shares will rank equally with the 756,432,316 Shares already issued by Conico and quoted on the ASX (ASX code: CNJ).

Impact on control

The capital structure of the Company on completion of the Offer will be as follows*:

Shares
Shares currently on issue	756,432,316
Shares offered under the Offer (est.)	75,643,232
Total Shares on issue on completion of the Offer (est.)	832,075,548
Options**
Listed options currently on issue	28,246,052
ESOP Options currently on issue	1,000,000
Options offered under the Offer (est.)	Nil
Options to be issued to the Underwriter***	20,000,000
Total options on issue on completion of the Offer (est.)****	49,246,052

• Assuming the Offer is fully subscribed, and none of the options currently on issue in the Company are converted

• to Shares before the Record Date.

** No new options in the Company will be issued pursuant this Offer.

*** At the completion of the Offer, the Company has agreed to issue to the Underwriter 20,000,000 new Options (as part of the consideration which is payable to the Underwriter for fully underwriting the Offer), each to acquire one Share at an exercise price of $0.07 exercisable at any time on or before 20 January 2024.

**** Assuming none of the existing options currently on issue in the Company are exercised before the Record Date.

email: mailroom@conico.com.au phone: +61 (08) 9282 5889 address: Level 15, 197 St George’s Terrace Perth, Western Australia

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conico.com.au ACN 119 057 457

Tuesday, 22 December 2020

The new Shares issued under the Offer will represent up to 9.09% of the expanded issued Share capital of Conico upon completion of the Offer (depending on the level of take up of the Offer).

Eligible Shareholders will be able to apply for additional Shares (over and above their entitlement) if all of the Shares under the Offer are not taken up by Eligible Shareholders (the Shares which are not taken up are hereinafter referred to as "the Shortfall"). The Shortfall will be placed at the discretion of the Company, and the Company reserves the right not to allot any of the Shortfall or to allot to an applicant a lesser number of the new Shares comprising the Shortfall than the number for which the applicant applies or to reject an application.

If the underwriting agreement is terminated for any reason, the Directors also reserve the right to place the balance of the Shortfall not subscribed for by Qualifying Shareholders under the offer of the Shortfall within 3 months of the Closing Date, at an issue price of not less than the issue price under the Offer, being $0.03 per Share.

Eligible Shareholders who have taken up their entitlement in full will not have their proportionate interest in the Company diluted by the Offer. Eligible Shareholders who take up their entitlement in full, and apply for (and are issued) additional new Shares forming part of the Shortfall will increase their proportionate interest in the Company. Eligible Shareholders who do not take up their entitlement in full (and non-Eligible Shareholders who are unable to participate in the Offer) will have their interest in the Company diluted.

Tasman Resources Limited A.C.N. 009 253 187 (Tasman) is the Company’s largest shareholder and currently holds 67,547,762 Shares (representing 8.93% of the Company’s existing Share capital) and 5,184,536 listed options (representing 18.35% of the total listed options). Given the extent of its current shareholding, Tasman does not currently have control over the Company. Tasman has indicated to the Company that it intends to support the Offer and to take up all or some of its Entitlements. As the Offer is fully underwritten it is therefore anticipated that Tasman’s interest in the Company’s issued Share capital will stay the same or decrease as a result of the Offer. The Offer is not conditional upon it being underwritten. If the underwriting agreement was terminated and not all of the Eligible Shareholders take up their entitlements under the Offer in full, Tasman’s shareholding interest in the Company could have increased at the conclusion of the Offer. However, in view of Tasman’s current shareholding in the Company, it is not considered that the Offer will have any affect on the control of the Company.

The Underwriter is not presently a shareholder of the Company. The Underwriter may enter into sub-underwriting agreements to sub-underwrite all or some of its obligation under its underwriting agreement. Given the new Shares issued under this Offer will represent up to 9.09% of the expanded issued Share capital of Conico only, irrespective of the amount of Shares which the Underwriter is required to subscribe for under its underwriting agreement and the extent of its sub-underwriting, the underwriting by the Underwriter will not have any impact on the control of the Company.

For further information please contact Aaron Gates, Company Secretary, on 9282 5889.

Dated: 22 December 2020

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Gregory H Solomon Chairman

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email: mailroom@conico.com.au phone: +61 (08) 9282 5889 address: Level 15, 197 St George’s Terrace Perth, Western Australia

conico.com.au ACN 119 057 457