GROUP 6 METALS LIMITED — Capital/Financing Update 2021

Oct 3, 2021

4 October 2021

King Island Scheelite Successfully Completes $31 Million Equity Raising

Total funding[1] for the redevelopment of the Dolphin Tungsten Project has now reached its targeted $88 million[2]

Highlights:

• Firm commitments received for $31 million equity raising, comprising a two-tranche placement (Placement) and underwritten Share Purchase Plan (SPP)

• Tranche 1 Placement - $14.3 million raised via the issue of approximately 102 million new shares at $0.14 to new and existing sophisticated, professional and institutional investors

• Tranche 2 Placement - $11.2 million raised via the issue of approximately 80 million new shares at $0.14 to existing shareholders, subject to shareholder approval

• A further $5.5 million is proposed to be raised through the issue of approximately 39 million new shares at $0.14, by way of an SPP underwritten to $5.5 million, subject to shareholder approval

• The equity raising, together with the Debt Facilities and mobile mining fleet leasing facilities announced on 6 September 2021, and the $10 million Tasmanian Government loan announced on 2 February 2021, fund the Company to redevelop its 100%-owned Dolphin Tungsten Project, subject to shareholder approvals at the upcoming AGM

• The redevelopment of the Dolphin Mine, which contains one of the world’s highest grade tungsten deposits, will provide a source of a critical mineral, classified as such, due to its economic importance as well as the inherent supply chain risks

1 Subject to shareholder approval

2 $10 million leasing facility remains subject to final approval

King Island Scheelite Limited ( ASX: KIS ) ( KIS or the Company ) is pleased to announce that it has now secured commitments for its targeted funding to proceed with the redevelopment of the Company’s wholly owned Dolphin Tungsten Project on King Island, Tasmania, subject to shareholder approval at the upcoming Annual General Meeting ( AGM ). The equity raising, together with the Debt Facilities (defined below), and a $10 million leasing facility currently in final negotiations, brings the total amount of capital raised by King Island Scheelite in 2021 to $88 million, which fully funds redevelopment of the Dolphin Tungsten Project.

Specifically, funding will be applied towards the purchase of key equipment, mobile mining equipment, processing plant development, civil/infrastructure construction, working capital associated therewith and costs of the equity raising. The Dolphin Tungsten Project is expected to produce first concentrate in the March quarter of 2023.

Equity Raising

The Company has successfully undertaken a $31 million equity raising which will see 222 million new shares issued at $0.14, being a discount of 17.6% to the last traded price and a 19.4% discount to the 15-day Volume Weighted Average Price ( VWAP ).

The raising will be completed by way of:

• Tranche 1 Placement

The issue of approximately 102 million new shares to new and existing sophisticated, professional and institutional investors to raise $14.3 million, using the Company’s placement capacity pursuant to ASX Listing Rules 7.1 and 7.1A capacities, respectively 61 million and 41 million equity securities.

Canaccord Genuity (Australia) Limited and PAC Partners Securities Pty Ltd acted as joint lead managers and bookrunners to Tranche 1 of the Placement.

• Tranche 2 Placement

The group of shareholders who provided the Debt Facilities (announced to the ASX on 6 September 2021) have committed to subscribe for $11.2 million via the issue of approximately 80 million new shares, subject to shareholder approval to be sought at the upcoming Annual General Meeting.

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• Shareholder Purchase Plan

KIS is providing an underwritten[3] Share Purchase Plan ( SPP ) to eligible, existing shareholders to raise a minimum of $5.5 million at the same price as the Placement of $0.14.

Participation in the SPP will be available exclusively to shareholders who were registered as holders or underlying beneficial holders of KIS shares at 7pm (Sydney time) on the Record Date of Friday 1 October 2021 and whose registered address is in Australia or New Zealand ( Eligible Shareholders ).

Pursuant to the SPP, Eligible Shareholders can subscribe for a minimum of $1,000 parcels of Shares up to $30,000 without incurring brokerage or transaction costs. Full details of the SPP will be set out in an offer document which the Company will send to eligible shareholders in accordance with the below timetable.

The new Shares to be issued under the SPP will be offered at the same price as the other issues.

King Island Scheelite Executive Chairman, Johann Jacobs, said:

"We are delighted to have secured the support of new and existing investors through this $31 million capital raise, at what is a pivotal moment in the Company’s history. Our strategy has allowed us to move forward with our plan to redevelop King Island's Dolphin Tungsten Mine, which hosts one of the few remaining high quality tungsten deposits in the Western world. Having secured commitments for the funding, we can now continue to execute on our vision to develop world class tungsten mining operations in Tasmania.

"On behalf of the Board, I thank our existing shareholders and incoming investors as well as all associated with the funding, for their support. We are focused on rapidly executing the Company’s redevelopment strategy and look forward to delivering value for the Company's partners, staff, investors and the King Island community."

Debt Facility Conversion Rights - Warrants

The providers of the $33 million debt facility announced in the ASX Release dated 6 September 2021, have agreed that, at their option and pursuant to warrants to be issued to them (subject to shareholder approval), they are able to convert between 65% and 75% of their debt into equity at a

3 Subject to shareholder approval

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premium of between 40% and 50% to the price of the Placement Shares. Full details are included in the Investor Presentation being lodged today with the ASX.

Performance Options

At a meeting, the Board ratified its decisions regarding the redevelopment of the Dolphin Mine and accordingly acknowledged that applicable Performance Options approved by the shareholders at the last Annual General Meeting have now vested.

Tungsten Market

Tungsten, the hardest metal in the world, has been identified by most Western Governments as a critical mineral due to its importance in everyday life through the manufacture of all transport modes, production of oil and gas and as a key input to the defense industry. Due to the concentration of supply out of China, ready access to the metal is also at risk.

The price of tungsten has increased significantly during 2021, increasing by 36% since 1 January 2021 to US$318/mtu, reinforcing the critical nature of the metal.[4]

Indicative Timetable

Set out below is an indicative timetable for the Placement and SPP. Other than the Record Date and announcement of the SPP, the Company may change these dates (including the closing date) and times at its discretion, subject to the ASX Listing Rules and Corporations Act.

Date	ASX Trading Day	Description	Action
Friday 1 October 2021	-1	Pending announcement of Placements (Tranche 1 and Tranche 2)and SPP	Trading halt requested
Friday 1 October 2021	-1	SPP Record Date	Date for determining Eligible Shareholders for SPP
Monday 4 October 2021	0	Equity raising announced	Trading halt lifted
Tuesday 5 October 2021	1	SPP Offer Date	Offer opens and Offer documentation dispatched to Eligible

4 London Metal Bulletin

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Date	ASX Trading Day	Description	Action
			Shareholders
Friday 8 October 2021	4	Tranche 1 allotment date	Tranche 1 share issue using the Company’s existing capacity under ASX Listing Rules 7.1 and 7.1A
Thursday 4 November 2021	23	Annual General Meeting	Annual General Meeting to approve EquityRaising
Friday 5 November 2021	24	SPP Closing Date	SPP Offer closes. Applications must be received by 5.00pm Sydneytime
Friday 12 November 2021	29	Announce SPP Results	Announcement date of funds raised and shares to be issued
Friday 12 November 2021	29	Tranche 2 and SPP allotment date	New Shares allotted
Monday 15 November 2021	30	Trading Date	Trading of New Shares allotted under the Offer to commence
Tuesday 16 November 2021	31	Dispatch Date	New Share Statements sent to Shareholders

An Appendix 3B for the proposed issue of the Placement shares will follow. This announcement effectively lifts the trading halt which the Company requested on Friday 1 October 2021.

This announcement has been authorised for release by the Directors of King Island Scheelite Limited.

For further information, please contact:

Executive Chairman Johann Jacobs King Island Scheelite Limited E: kis@kisltd.com.au T: +61 416 125 449

Investor Relations Tim Dohrmann NWR Communications E: tim@nwrcommunications.com.au T: +61 468 420 846

W: www.kingislandscheelite.com.au

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