CORE LITHIUM LTD — AGM Information 2021

Aug 18, 2021

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CORE LITHIUM LTD ACN 146 287 809

NOTICE OF GENERAL MEETING

EXPLANATORY NOTES

PROXY FORM

Date of Meeting Friday, 17 September 2021

Time of Meeting 12:30pm ACST (Adelaide time)

Place of Meeting Offices of Grant Thornton Australia Limited Level 3, 170 Frome Street Adelaide, South Australia

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CORE LITHIUM LTD ACN 146 287 809

NOTICE OF 2021 GENERAL MEETING

Notice is hereby given that this General Meeting of Shareholders of Core Lithium Ltd (“Company/Core”) will be held at the offices of Grant Thornton Australia Limited, Level 3, 170 Frome Street, Adelaide, South Australia on Friday 17 September 2021 at 12:30pm ACST.

The business to be considered at the General Meeting is set out below.

This Notice of Meeting should be read in its entirety in conjunction with the accompanying Explanatory Notes, which form part of this Notice of Meeting and contain information in relation to the following Resolutions. If you are in any doubt as to how you should vote on the Resolutions set out in this Notice of Meeting, you should consult your financial or other professional adviser.

Defined terms used in this Notice of Meeting have the meanings given to those terms in the Glossary at the end of the Explanatory Notes.

ORDINARY BUSINESS

Resolution 1 – Issue of 100,591,715 Ganfeng Shares

To consider and, if thought fit, pass the following Resolution as an Ordinary Resolution:

“That, for the purposes of ASX Listing Rule 7.1 and for all other purposes, the proposed issue and allotment of 100,591,715 Ganfeng Shares as set out in the Notice of Meeting and Explanatory Notes is approved.”

Resolution 2 – Ratification of 293,146,659 Placement Shares issued on or about 17 August 2021

To consider and, if thought fit, pass the following Resolution as an Ordinary Resolution:

“That, for the purposes of ASX Listing Rule 7.4 and for all other purposes, Shareholders ratify the issue and allotment of 293,146,659 Placement Shares on or about 17 August 2021 on the terms and to the parties set out in the Explanatory Notes.”

Resolution 3 – Ratification of 306,123 Consideration Shares issued on 11 March 2021

To consider and, if thought fit, pass the following Resolution as an Ordinary Resolution:

“That, for the purposes of ASX Listing Rule 7.4 and for all other purposes, Shareholders ratify the issue and allotment of 306,123 Shares on 11 March 2021 on the terms and to the parties set out in the Explanatory Notes.”

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VOTING INFORMATION, EXCLUSIONS AND PROHIBITIONS

The business of the Meeting affects your Shareholding and your vote is important.

Voting exclusion in relation to Resolution 1

In accordance with the ASX Listing Rules, the Company will disregard any votes cast in favour of Resolution 1 by or on behalf of Ganfeng or any of its Associates.

However, this does not apply to a vote cast in favour of a Resolution by:

• a person as proxy or attorney for a person who is entitled to vote on the Resolution, in accordance with directions given to the proxy or attorney to vote on the Resolution in that way; or

• the Chair of the Meeting as proxy or attorney for a person who is entitled to vote on the Resolution, in accordance with a direction given to the Chair of the Meeting to vote on the Resolution as the Chair of the Meeting decides; or

• a holder acting solely in a nominee, trustee, custodial or other fiduciary capacity on behalf of a beneficiary provided the following conditions are met:

• the beneficiary provides written confirmation to the holder that the beneficiary is not excluded from voting, and is not an Associate of a person excluded from voting, on the Resolution; and

• the holder votes on the Resolution in accordance with directions given by the beneficiary to the holder to vote in that way.

Voting exclusion in relation to Resolution 2

In accordance with the ASX Listing Rules, the Company will disregard any votes cast in favour of Resolution 2 by or on behalf of participants in the Placement or any of their Associates.

However, this does not apply to a vote cast in favour of a Resolution by:

• a person as proxy or attorney for a person who is entitled to vote on the Resolution, in accordance with directions given to the proxy or attorney to vote on the Resolution in that way; or

• the Chair of the Meeting as proxy or attorney for a person who is entitled to vote on the Resolution, in accordance with a direction given to the Chair of the Meeting to vote on the Resolution as the Chair of the Meeting decides; or

• a holder acting solely in a nominee, trustee, custodial or other fiduciary capacity on behalf of a beneficiary provided the following conditions are met:

• the beneficiary provides written confirmation to the holder that the beneficiary is not excluded from voting, and is not an Associate of a person excluded from voting, on the Resolution; and

• the holder votes on the Resolution in accordance with directions given by the beneficiary to the holder to vote in that way.

Voting exclusion in relation to Resolution 3

In accordance with the ASX Listing Rules, the Company will disregard any votes cast in favour of Resolution 3 by or on behalf of SungJean Ough or any of his Associates.

However, this does not apply to a vote cast in favour of a Resolution by:

• a person as proxy or attorney for a person who is entitled to vote on the Resolution, in accordance with directions given to the proxy or attorney to vote on the Resolution in that way; or

• the Chair of the Meeting as proxy or attorney for a person who is entitled to vote on the Resolution, in accordance with a direction given to the Chair of the Meeting to vote on the Resolution as the Chair of the Meeting decides; or

• a holder acting solely in a nominee, trustee, custodial or other fiduciary capacity on behalf of a beneficiary provided the following conditions are met:

• the beneficiary provides written confirmation to the holder that the beneficiary is not excluded from voting, and is not an Associate of a person excluded from voting, on the Resolution; and

• the holder votes on the Resolution in accordance with directions given by the beneficiary to the holder to vote in that way.

Voting, Attendance Entitlement and proxy

A Member who is entitled to attend and cast a vote at the Meeting and who wishes to vote on the Resolutions contained in this Notice should either attend in person at the time, date and place of the Meeting set out above or appoint a proxy or proxies to attend or vote on the Member’s behalf. In the interests of public health and safety of our Shareholders, due to the current COVID-19 pandemic, the Company encourages Shareholders to vote via proxy and not physically attend the Shareholder Meeting .

A Member who is entitled to attend and cast a vote at the Meeting and who wishes to vote on the Resolutions contained in this Notice should appoint the Chairman of the Meeting as their proxy to attend and vote on the Member’s behalf. Core encourages shareholders to appoint the Chairman of the Meeting as their proxy.

The situation regarding COVID-19 is evolving rapidly and Core is following the health advice of the Australian Government. Shareholders are encouraged to monitor the Company’s ASX announcements and website for any further updates in relation to arrangement for the Company’s Shareholder Meeting.

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Shareholders are encouraged to complete their Proxy Forms online at https://www.automicgroup.com.au/.

In completing the Proxy Form, Members must be aware that where the Chair of the Meeting is appointed as their proxy, they will be directing the Chair of the Meeting to vote in accordance with the Chair of the Meeting’s voting intention unless you indicate otherwise by marking the “For”, “Against” or “Abstain” boxes. The Chair of the Meeting intends to vote undirected proxies in favour of each item of business. Members should note that they are entitled to appoint the Chair of the Meeting as a proxy with a direction to cast the votes contrary to the Chair of the Meeting’s voting intention, or to abstain from voting, on any Resolution in the Proxy Form. Also, Members may appoint, as their proxy, a person other than the Chair of the Meeting.

A proxy need not be a Member of the Company. For the convenience of Members, a Proxy Form is enclosed. A Member who is entitled to attend and cast two or more votes is entitled to appoint two proxies. Where two proxies are appointed, each appointment may specify the proportion or number of voting rights each proxy may exercise. If the Member appoints two proxies and the appointment does not specify this proportion, each proxy may exercise half of the votes able to be cast by the appointing Member.

To vote by proxy, please complete and sign the enclosed Proxy Form and return to the address below by the time and in accordance with the instructions set out on the Proxy Form.

On-line: https://www.automicgroup.com.au/. By mail: Automic GPO BOX 5193 SYDNEY NSW 2001 By hand: Level 5, 126 Phillip Street SYDNEY NSW 2000 By e-mail: meetings@automicgroup.com.au

In order to be valid, the Proxy Form must be received by the Company, along with any power of attorney or certified copy of a power of attorney (if the Proxy Form is signed pursuant to a power of attorney), by no later than 48 hours before the Meeting (i.e., by no later than 12:30pm ACST on 15 September 2021). Any Proxy Forms received after that time will not be valid for the Meeting.

A Member who is a body corporate may appoint a representative, including an individual, to attend the Meeting in accordance with the Corporations Act. Representatives will be required to present documentary evidence of their appointment on the day of the Meeting.

For the purpose of determining the voting entitlements at the Meeting, the Directors have determined that Shares will be taken to be held by the registered holders of those Shares at 6:30pm ACST on 15 September 2021. Accordingly, transactions registered after that time will be disregarded in determining entitlements to attend and vote at the Meeting.

By order of the Board

Jaroslaw (Jarek) Kopias

Company Secretary Adelaide, 19 August 2021

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GENERAL MEETING - EXPLANATORY NOTES

These Explanatory Notes accompanying this Notice of Meeting and are incorporated in and comprise part of this Notice of Meeting. The Explanatory Notes should be read in conjunction with this Notice of Meeting.

These Explanatory Notes have been prepared to provide Shareholders with material information to enable them to make an informed decision on the business to be considered at the General Meeting of the Company. The Directors recommend Shareholders read these Explanatory Notes in full before making any decision in relation to the Resolutions. If any Shareholder is in doubt as to how they should vote, they should seek advice from their legal, financial or other professional adviser prior to voting.

Terms defined in the Notice of Meeting have the same meaning in these Explanatory Notes.

GENERAL BUSINESS

Introduction

On 9 August the Company announced a $140 million equity raise to fund development of the Finniss Lithium Project. The equity raise comprised a:

• fully underwritten placement to sophisticated and professional investors to raise $91 million at a price of $0.31 per Share ( Placement );

• share subscription agreement with Ganfeng to raise $34 million at $0.338 per Share ( Ganfeng Shares ); and

• share purchase plan to raise up to $15 million at $0.31 per Share.

Resolution 1 seeks Shareholder approval to the future issue of the Ganfeng Shares and Resolution 2 seeks ratification of the prior issue of the Shares in the Placement.

Resolution 1: Issue of 100,591,715 Ganfeng Shares

On 9 August 2021, the Company announced a share placement to Ganfeng in conjunction with a spodumene offtake agreement to raise $34.0 million before costs ( Ganfeng Placement ). The Company seeks Shareholder approval, for the purposes of Listing Rule 7.1, to issue 100,591,715 Shares to Ganfeng at a price of $0.338 (33.8 cents) per Share.

Broadly speaking, and subject to a number of exceptions, ASX Listing Rule 7.1 limits the amount of equity securities that a listed company can issue without the approval of its shareholders over any 12 month period to 15% of the fully paid ordinary shares it had on issue at the start of that period.

If Resolution 1 is passed, the Company will be able to proceed with the issue of Ganfeng Placement Shares and raise $34 million. In addition, the Shares will be excluded from the calculation of the number of equity securities that the Company can issue without Shareholder approval under ASX Listing Rule 7.1.

If Resolution 1 is not passed, the Company will not be able to proceed with the issue of Ganfeng Placement Shares and raise $34 million potentially impacting its ability to deliver on its objective of progressing the Finniss Lithium Project to production. Further, it is a condition of the offtake arrangements with Ganfeng announced by the Company on 9 August 2021 that shareholder approval is obtained for the Ganfeng Placement. In addition, the Shares will not be excluded from the calculation of the number of equity securities that the Company can issue without Shareholder approval under ASX Listing Rule 7.1.

In accordance with the requirements of Listing Rule 7.3 the following information is provided in respect of the proposed issue of Ganfeng Placement Shares:

• (a) the Shares will be issued to Ganfeng;

• (b) 100,591,715 Shares will be issued as a price of $0.338 (33.8 cents) per Share;

• (c) the funds raised upon the issue of Shares to Ganfeng will be used towards:

• (i) upfront capital costs for the Finniss Lithium Project;

• (ii) exploration and development activities;

• (iii) environmental Bond for the Finniss Lithium Project; and

• (iv) working capital purposes.

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(d) The issue of Ganfeng Shares will be made under a Subscription Agreement announced to ASX on 9 August 2021 which includes the following key terms:

• (i) Ganfeng will subscribe for $34 million new Shares at a price of $0.338 per Share;

• (ii) at the same time as signing the Subscription Agreement, Ganfeng executed an offtake agreement with Lithium Developments (Grants NT) Pty Ltd, a wholly owned subsidiary of Core, pursuant to which Lithium Developments agrees to sell lithium concentrate to Ganfeng;

• (iii) the issue of Ganfeng Shares is conditional upon the satisfaction or waiver of the following conditions ( Conditions ):

  • (A) receipt of Chinese regulatory approval;

  • (B) Core Shareholder approval, the subject of this Resolution 1; and

  • (C) Core obtaining financing of at least $80 million – including the $34 million placement to Ganfeng;

• (iv) The Subscription Agreement otherwise includes various terms and conditions common to agreements of this sort; and

• (e) the allotment of the Shares to Ganfeng is expected to be within 3 business days of the satisfaction or waiver of the last of the Conditions, and in any event, within three (3) months of the date of the Meeting.

Board Recommendation : The Directors recommend that Shareholders vote in favour of Resolution 1.

The Chair of the Meeting intends to vote all undirected proxies in favour of the issue of 100,591,715 Shares to Ganfeng pursuant to Resolution 1.

Resolutions 2 and 3: Ratification of 293,146,659 Placement Shares issued on or about 17 August 2021 and 306,123 Consideration Shares issued on 11 March 2021

Background

On 9 August 2021, the Company announced an issue of 293,146,659 Shares at a price of $0.31 (31.0 cents) per share to applicants under an institutional share placement to raise approximately $91 million (before costs). The Placement is being undertaken in conjunction with a share purchase plan.

On 11 March 2021, the Company announced an issue of 306,123 Shares at a price of $0.245 (24.5 cents) per share to Mr Jean Ough for professional services valued at $75,000 (Consideration Shares).

Broadly speaking, and subject to a number of exceptions, ASX Listing Rule 7.1 limits the amount of equity securities that a listed company can issue without the approval of its shareholders over any 12-month period to 15% of the fully paid ordinary shares it had on issue at the start of that period.

The relevant Shares issued to participants in the Placement and Consideration Shares issued did not fall within an exception and were issued without Shareholder approval under the Company’s 15% placement capacity under ASX Listing Rule 7.1 and the Company’s 10% Additional Placement Capacity under ASX Listing Rule 7.1A.

ASX Listing Rule 7.4 allows the shareholders of a listed company to subsequently ratify the previous issues of securities made without prior shareholder approval under ASX Listing Rule 7.1 and ASX Listing Rule 7.1A, provided the issue did not breach the maximum thresholds set by ASX Listing Rule 7.1 and ASX Listing Rule 7.1A. If they do, the issue is taken to have been approved under ASX Listing Rule 7.1 and ASX Listing Rule 7.1A and so does not reduce the company’s capacity to issue further equity securities without shareholder approval under those rules.

The Company wishes to retain as much flexibility as possible to issue additional equity securities into the future without having to obtain Shareholder approval for such issues under ASX Listing Rule 7.1 and ASX Listing Rule 7.1A and thus the Company is seeking ratification of the Placement Shares issued pursuant to Resolution 2 and the Consideration Shares pursuant to Resolution 3. The Company confirms that the issue and allotment of the Placement Shares and Options did not breach ASX Listing Rule 7.1 and ASX Listing Rule 7.1A at the date of issue.

If Resolutions 2 and 3 are passed, the relevant issues will be excluded in calculating the Company’s 15% limit in ASX Listing Rule 7.1 and 10% Additional Placement Capacity limit in ASX Listing Rule 7.1A, effectively increasing the number of Equity Securities it can issue without Shareholder approval over the 12-month period following the date of issue.

If Resolutions 2 and 3 are not passed, the relevant issues will be included in calculating the Company’s 15% limit in ASX Listing Rule 7.1 and 10% Additional Placement Capacity limit in ASX Listing Rule 7.1A, effectively decreasing the number of Equity Securities it can issue without Shareholder approval over the 12-month period following the date of issue.

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ASX Listing Rule 7.5 contains certain requirements as to the contents of a Notice sent to Shareholders for the purpose of ASX Listing Rule 7.4 and the following information is included in these Explanatory Notes for that purpose:

	Resolution 2 – Share Placement	Resolution 3 – Consideration Shares
Party	Institutional investors, not requiring a disclosure statement who were identified and sourced by the joint lead managers to the Placement. No related parties of the Company were issued any Shares under the Share Placement.	Mr Sung-Jean Ough who is not a related party of the Company.
Securities issued	175,765,546 Shares were issued under ASX Listing Rule 7.1. 117,381,113 Shares were issued under ASX Listing Rule 7.1A. The Shares are fully paid ordinary shares.	306,123 Shares were issued under ASX Listing Rule 7.1. The Shares are fully paid ordinary shares.
Date of issue	On or about 17 August 2021	11 March 2021
Consideration	$90,875,464 at a price of $0.31 (31.0 cents) each.	$75,000 at a price of $0.245 (24.5 cents) each.
Terms of Securities	Shares rank equally with all other Shares on issue.	Shares rank equally with all other Shares on issue.
Terms of agreement	Share placement made under a placement agreement with the joint lead managers, Merrill Lynch Equities (Australia) Limited and Canaccord Genuity (Australia) Limited. The agreement includes terms and conditions standard in these types of agreements, and was summarised in the investor presentation lodged with ASX on 9 August 2021.	Shares issued for professional marketing services to the value of $75,000 settled via payment in cash or Core Shares (at Core’s election).
Purpose	The purpose of the issue was to fund the Finniss Lithium Project upfront capital costs, environmental bond, exploration and development activities, costs of the Placement and working capital requirements.	Professional services.

Board Recommendation : The Directors recommend that Shareholders vote in favour of Resolutions 2 and 3.

The Chair of the Meeting intends to vote all undirected proxies in favour of the ratification of Resolutions 2 and 3.

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Glossary

In the Notice of General Meeting and Explanatory Notes:

10% Additional Placement Capacity means the Equity Securities issued under Listing Rule 7.1A.

ACST means Australian Central Standard Time.

Associate has the meaning given to that term in the Corporations Act.

ASX means ASX Limited (ABN 98 008 624 691).

Board means the board of Directors of Core.

Chair of the Meeting means the chairman of the Meeting.

Consideration Shares means 306,123 Shares at a price of $0.245 (24.5 cents) per share to Mr Jean Ough for professional services valued at $75,000.

Core or Company means Core Lithium Ltd (ABN 80 146 287 809).

Corporations Act means the Corporations Act 2001 (Cth).

Director means a director of the Company.

Equity Securities or Securities has the same meaning as in the Listing Rules.

Explanatory Notes means these explanatory notes.

Ganfeng means Ganfeng New Energy Technology Development (Suzhou) Co., LTD.

Listing Rules and ASX Listing Rules means the listing rules of ASX.

Meeting or General Meeting means the general meeting of Shareholders to be held at the offices of Grant Thornton Australia Limited, Level 3, 170 Frome Street, Adelaide, South Australia on Friday 17 September 2021 at 12:30pm ACST.

Member or Shareholder means each person registered as a holder of a Share.

Notice or Notice of Meeting means this notice of General Meeting.

Ordinary Resolution means a resolution passed by more than 50% of the votes cast by Shareholders entitled to vote at a general meeting of Shareholders.

Placement means the Share placement announced by Core on 9 August 2021 to issue 293,146,659 Shares at a price of $0.31 (31.0 cents) per share to investors not requiring a disclosure document.

Placement Shares means Shares issued pursuant to the Placement.

Proxy Form means the proxy form attached to this Notice of Meeting.

Resolution means a resolution referred to in this Notice.

Share means a fully paid ordinary share in the capital of the Company.

Subscription Agreement means an agreement to subscribe for Shares in the Company between Core and Ganfeng New Energy Technology Development (Suzhou) Co., LTD.

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