TURNSTONE RESOURCES LTD — Capital/Financing Update 2022

Nov 15, 2022

Proposed issue of securities

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Announcement Summary

Entity name

SOUTH HARZ POTASH LTD

Announcement Type

New announcement

Date of this announcement

16/11/2022

The Proposed issue is:

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A placement or other type of issue

Total number of +securities proposed to be issued for a placement or other type of issue

		Maximum Number of
ASX +security code	+Security description	+securities to be issued
New class-code to be	Unlisted Options exercisable at $0.135 and expiring 23 Nov	3,366,666
confirmed	2025
SHP	ORDINARY FULLY PAID	67,333,332

Proposed +issue date

24/11/2022

Refer to next page for full details of the announcement

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Part 1 - Entity and announcement details

1.1 Name of +Entity

SOUTH HARZ POTASH LTD

We (the entity named above) give ASX the following information about a proposed issue of +securities and, if ASX agrees to +quote any of the +securities (including any rights) on a +deferred settlement basis, we agree to the matters set out in Appendix 3B of the ASX Listing Rules.

If the +securities are being offered under a +disclosure document or +PDS and are intended to be quoted on ASX, we also apply for quotation of all of the +securities that may be issued under the +disclosure document or +PDS on the terms set out in Appendix 2A of the ASX Listing Rules (on the understanding that once the final number of +securities issued under the +disclosure document or +PDS is known, in accordance with Listing Rule 3.10.3C, we will complete and lodge with ASX an Appendix 2A online form notifying ASX of their issue and applying for their quotation).

1.2 Registered Number Type

ACN

Registration Number

153414852

1.3 ASX issuer code

SHP

1.4 The announcement is

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New announcement

1.5 Date of this announcement

16/11/2022

1.6 The Proposed issue is:

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A placement or other type of issue

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Part 7 - Details of proposed placement or other issue

Part 7A - Conditions

7A.1 Do any external approvals need to be obtained or other conditions satisfied before the placement or other type of issue can proceed on an unconditional basis? Yes

7A.1a Conditions

Approval/Condition Date for determination Is the date estimated or ** Approval actual? received/condition met? +Security holder approval 9/1/2023 Estimated No

Comments

Shareholder approval required for directors to participate in placement (for 13,888,888 shares)

Part 7B - Issue details

Is the proposed security a 'New class' (+securities in a class that is not yet quoted or recorded by ASX) or an 'Existing class' (additional securities in a class that is already quoted or recorded by ASX)? Existing class

Will the proposed issue of this +security include an offer of attaching +securities? No

Details of +securities proposed to be issued

ASX +security code and description

SHP : ORDINARY FULLY PAID

Number of +securities proposed to be issued

67,333,332

Offer price details

Are the +securities proposed to be issued being issued for a cash consideration? Yes

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Proposed issue of securities
In what currency is the cash	What is the issue price per
consideration being paid?	+security?
AUD - Australian Dollar	AUD 0.04500
Will these +securities rank equally in all respects from their issue date with
the existing issued +securities in that class?
Yes
Is the proposed security a 'New	Will the proposed issue of this
class' (+securities in a class that is	+security include an offer of
not yet quoted or recorded by ASX)	attaching +securities?
or an 'Existing class' (additional	No
securities in a class that is already
quoted or recorded by ASX)?
New class
Details of +securities proposed to be issued
ISIN Code (if Issuer is a foreign company and +securities are non CDIs)
Have you received confirmation from	Will the entity be seeking quotation
ASX that the terms of the proposed	of the 'new' class of +securities on
+securities are appropriate and	ASX?
equitable under listing rule 6.1?	No
No
ASX +security code New class-code to be confirmed	+Security description Unlisted Options exercisable at $0.135 and expiring 23 Nov 2025
+Security type
Options
Number of +securities proposed to be	issued
3,366,666
Offer price details
Are the +securities proposed to be issued being issued for a cash consideration?
No
Please describe the consideration being provided for the +securities Pursuant to an Agreement for the Provision of Services
Please provide an estimate of the AUD equivalent of the consideration being
provided for the +securities
61,000.000000

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Will all the +securities issued in this class rank equally in all respects from their issue date?

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Yes

Options details
+Security currency	Exercise price	Expiry date
AUD - Australian Dollar	AUD 0.1350	23/11/2025
Details of the type of +security that will be issued if the option is exercised
SHP : ORDINARY FULLY PAID
Number of securities that will be	issued if the option is exercised

one fully paid share for each option exercised

Please provide a URL link for a document lodged with ASX setting out the material terms of the +securities proposed to be issued or provide the information by separate announcement. https://southharzpotash.com/investors/asx-announcements/

Part 7C - Timetable

7C.1 Proposed +issue date 24/11/2022

Part 7D - Listing Rule requirements

7D.1 Has the entity obtained, or is it obtaining, +security holder approval for the entire issue under listing rule 7.1? No

7D.1b Are any of the +securities proposed to be issued without +security holder approval using the entity's 15% placement capacity under listing rule 7.1? Yes

7D.1b ( i ) How many +securities are proposed to be issued without security holder approval using the entity's 15% placement capacity under listing rule 7.1?

53,444,444 shares to be issued using the Company's 15% capacity under LR7.1;

3,366,666 options to be issued using the Company's 15% capacity under LR7.1; and 13,888,888 shares to be issued to parties referred to in LR 10.11 subject to shareholder approval

7D.1c Are any of the +securities proposed to be issued without +security holder approval using the entity's additional 10% placement capacity under listing rule 7.1A (if applicable)?

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No

7D.2 Is a party referred to in listing rule 10.11 participating in the proposed issue? Yes

7D.3 Will any of the +securities to be issued be +restricted securities for the purposes of the listing rules? No

7D.4 Will any of the +securities to be issued be subject to +voluntary escrow? No

Part 7E - Fees and expenses

7E.1 Will there be a lead manager or broker to the proposed issue? Yes

7E.1a Who is the lead manager/broker?

Morgans Corporate Limited

7E.1b What fee, commission or other consideration is payable to them for acting as lead manager/broker?

2% Management fee on total proceeds of Offer

4% Selling fee on total proceeds of Offer

Lead Manager Options equal to 5% of the shares issued through the Offer at an exercise price of 200% of the Offer price and a 3 year life

7E.2 Is the proposed issue to be underwritten? No

7E.4 Details of any other material fees or costs to be incurred by the entity in connection with the proposed issue No other material fees

Part 7F - Further Information

7F.01 The purpose(s) for which the entity is issuing the securities

For near-term value-adding initiatives as part of the Ohmgebirge Pre-Feasibility Study (PFS) workstreams

7F.1 Will the entity be changing its dividend/distribution policy if the proposed issue proceeds? No

7F.2 Any other information the entity wishes to provide about the proposed issue

No

7F.3 Any on-sale of the +securities proposed to be issued within 12 months of their date of issue will comply with the secondary sale provisions in sections 707(3) and 1012C(6) of the Corporations Act by virtue of:

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The publication of a cleansing notice under section 708A(5), 708AA(2)(f), 1012DA(5) or 1012DAA(2)(f)

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