Announcement PDF Share Purchase Plan Hastings Technology Metals Ltd ABN 43 122 911 399 This is an important document. The Offer does not take into account the individual investment objectives, financial situation or particular needs of each Eligible Shareholder. Accordingly, before making a decision on whether or not to accept the Offer, you should consult your financial or other professional adviser. If you have any questions in relation to the Offer or how to complete the Application Form, please call the Company’s Share Registry, Security Transfer Australia Pty Limited on 1300 992 916 or Mr Guy Robertson – Company Secretary on +61 2 9078 7674. This document is not a prospectus or other disclosure document under the Corporations Act. The distribution of this document (including electronic copies) outside Australia and New Zealand may be restricted by law. NOT FOR DISTRIBUTION OR RELEASE IN THE UNITED STATES OR TO US PERSONS. Important Notice The Offer contained in this document is not a recommendation to purchase Shares. If you are in any doubt about what to do with the Offer, you should consult your financial or other professional adviser. If you apply to participate in the Offer by making a BPay® payment (using an Australian bank account) or completing and returning the Application Form with a cheque or bank draft, you are accepting the risk the market price of Shares may change between the date of the Offer and the Issue Date for the New Shares. This means it is possible that, up to or after the Issue Date, you may be able to buy Shares at a lower price than the Offer Price. Equator Capital Management Pte Limited and Roger Fong have agreed to underwrite the Offer. They have not authorised or caused the issue of this Offer Document or the making of the Offer under this Offer Document, and make no representation regarding, and to the extent permitted by law excludes any responsibility for, any statements in or omissions from any part of this Offer Document. Participation in the Offer is not being offered, directly or indirectly, in the United States or to any person that is, or is acting for the account or benefit of, a US Person. The New Shares to be offered and sold in the Share Purchase Plan have not been, and will not be, registered under the U.S. Securities Act of 1933, as amended, or under the securities laws of any state or other jurisdiction of the United States. This document and any related documents including the Application Form must not be mailed or otherwise transmitted or distributed in or into the United States or to any person that is, or is acting for the account or benefit of, a US Person. Directors recommend you monitor the Company’s announcements, which can be found on its website at www.hastingsraremetals.com and on the ASX website at www.asx.com.au (ASX: HAS). The Company recommends that you obtain your own financial and taxation advice in relation to this Offer and consider price movements of Shares in the Company prior to making an Application under the Plan, which can be found on its website, the ASX website or in the financial pages of major Australian metropolitan newspapers. Timetable to the Offer Record Date - Date for determination of Eligible Shareholders 7.00pm AEST 1 June 2017 Announcement of Share Purchase Plan 2 June 2017 Opening Date for receipt of acceptances - Offer documents and Application Forms mailed to Eligible Shareholders 6 June 2017 Closing date for acceptances to be received by the Company 5.00pm AEST 26 June 2017 Issue Date of New Shares under the Share Purchase Plan 27 June 2017 Dispatch of holding statements for New Shares issued under the Share Purchase Plan 28 June 2017 Date on which the New Shares are expected to commence trading on ASX 29 June 2017 This timetable is indicative only and subject to change. The Company reserves the right to vary the above dates, subject to the ASX Listing Rules and the Corporations Act, without notice. Offer Booklet - 2017 SPP Final2_ja amendments Page 2 Key steps Step 1: Step 2: Read the terms and conditions of the Share Purchase Plan in full.  There is no requirement to participate in the Share Purchase Plan.  Participation in the Share Purchase Plan is entirely voluntary. Are you an Eligible Shareholder? (see section 3) You are eligible to apply for the New Shares if:  your registered address in the Company’s registered members is in Australia or New Zealand; and  you were registered as a holder of Shares as at 7:00pm (AEST) on 1 June 2017 (Record Date). The Offer is not being extended to any Shareholder, as at the Record Date, whose registered address is not situated in Australia or New Zealand. Neither these terms and conditions nor the Application Form constitutes an offer to buy securities in the United States (or to, or for the account or benefit of, US Persons). Step 3: Step 4: If you choose to participate in the Share Purchase Plan, you must choose to purchase a parcel of New Shares for one of the following amounts (see section 6): $2,500 $10,000 $5,000 $12,500 $7,500 $15,000 To apply for New Shares under the Share Purchase Plan, Eligible Shareholders must (see section 11):  complete the Application Form attached to these terms and conditions; or  make a BPay® payment by using the personalised reference number shown on your Application Form, which is required to identify your holding. Questions If you have any questions in relation to the Offer or how to complete the Application Form, please call the Company’s Share Registry, Security Transfer Australia Pty Limited on or Mr Guy Robertson 1300 992 916 or from overseas +61 3 9628 2200 – Company Secretary on +61 2 9078 7671 or email guy@hastingstechmetals.com, or consult your financial or other professional adviser. Offer Booklet - 2017 SPP Final2_ja amendments 3453-9157-7861, v. 2 Page 3 Letter to Shareholder Dear Shareholder, Offer to participate in Hastings Technology Metals Ltd Share Purchase Plan The Directors of Hastings Technology Metals Ltd (Hastings or Company) are pleased to extend an invitation to Eligible Shareholders to participate in the Company's Share Purchase Plan (Plan or SPP). The Plan allows Eligible Shareholders to purchase up to $15,000 worth of fully paid ordinary shares in the Company (Shares) without any brokerage or transaction costs. The Plan was announced by the Company to the Australian Securities Exchange (ASX) on 2 June 2017. The Shares under the Plan will be issued at 8.6 cents per Share, which is equal to the 5 day volume weighted average price (VWAP) to the record date. The offer of Shares under the Plan is open to all Eligible Shareholders (as defined in the attached Offer) as at 7:00pm (AEST) on 1 June 2017 (Record Date). Hastings has achieved significant milestones since the start of 2017:  Successful completion of Beneficiation and Hydrometallurgy piloting;  Lead Agency Project status determination by the Western Australian Department of Mines;  Established technical team with significant experience in rare earths and rare earths plant construction; and  Initial offtake agreement discussions held with a number of potential global customers, which together with improving Neodymium (Nd) and Praseodymium (Pr) prices over the prior year and additional in-fill drilling underway to extend the mine life to 10 years, will increase the economic value of the Company’s Yangibana rare earth project. The SPP will enable shareholders to participate on a “level playing field” basis by acquiring additional shares without incurring transaction costs. The SPP is fully underwritten. The Directors and senior management, who are current shareholders, have confirmed their participation in the SPP. The Plan is to raise up to $5 million through the issue of up to 58,139,534 New Shares. The Company reserves the right to scale back an Eligible Shareholder’s subscription (in its absolute discretion) in the event total Shareholder demand exceeds 58,139,534 New Shares. The Company also reserves the right to accept oversubscriptions, subject to compliance with all laws, regulations, ASIC class orders, requirements or policies or any ASX Listing Rule. The Offer is fully underwritten for $5 million by Equator Capital Management Pte Limited (a company in which Charles Lew, Executive Chairman is a director and shareholder) and Roger Fong, a shareholder of the Company. Participation in the Plan is entirely voluntary. Offers under the Plan are non-renounceable, meaning that you are not permitted to transfer your rights to subscribe for Shares under the Plan. If after reading the attached Offer you wish to participate in the Plan, you must complete and return the attached personalised Application Form, together with a cheque and return it to the Company’s Share Registry on or before 5.00pm (AEST) on 26 June 2017. Alternatively you may use the BPAY® facility described later in this documentation. Offer Booklet - 2017 SPP Final2_ja amendments 3453-9157-7861, v. 2 Page 4 The funds raised from the SPP will be used to fund the following ongoing work:  Continue with in-fill drilling and drilling at a number of new targets, including Auer, Auer North, Yangibana, Yangibana South and Simon’s Find to increase current Inferred Resources to the Measured & Indicated category and achieve an extension in the life of mining operations;  Commence preliminary engineering design and specification work with respect to the mine infrastructure and construction of the processing plant.  Further optimisation test-work to increase the recovery and concentrate grades in the beneficiation process with resultant fine tuning of the flotation circuit chemistry.  Initial procurement preparatory work to further reduce capital and operational expenditure (as part of the DFS) to achieve budgeted cost of $300m and $120m respectively.  Compliance work with respect to the Mining Permit application (commonly referred to as “permitting”) currently underway with the relevant government authorities. Further details of the Plan are set out below. The Plan allows Eligible Shareholders, irrespective of the size of their shareholding, to apply for one of the following parcels of Shares: Offer Value Number of Shares A $2,500 29,069 B $5,000 58,139 C $7,500 87,209 D $10,000 116,279 E $12,500 145,348 F $15,000 174,418 Hastings Projects Hastings has two JORC compliant rare earths projects in Western Australia –the Yangibana project and the Brockman project (formerly Hastings). Yangibana The Yangibana Nd-Pr Project, located in the Gascoyne region in Western Australia, will complete its Definitive Feasibility Study (DFS) in October 2017. Notwithstanding the recent successful completion of the beneficiation and hydrometallurgy piloting test-work validating the simple and effective flow sheet for the Yangibana processing plant, the Company has continued to make further progress in its metallurgy enhancements. The Company’s recently appointed Project Director, Mr. Kok Hoong Leong, together with his team, will utilise the data generated by the piloting test-work to complete the engineering design and equipment specification work on production processing plants. Mr Leong was previously the project manager for the successful construction of Lynas’ Phase 2 rare earth processing plant in both Mt Weld, Australia and Kuantan, Malaysia where the project was completed on time and on budget. Offer Booklet - 2017 SPP Final2_ja amendments 3453-9157-7861, v. 2 Page 5 He has extensive experience in engineering design, construction and project management. Between now and completion of the Definitive Feasibility Study (DFS) (scheduled for October 2017), the Company is continuing to optimise both beneficiation and hydrometallurgy processes for higher recovery and concentration levels of Neodymium (Nd) and Praseodymium (Pr) rare earths. The hydrometallurgical piloting test-work generated 50kgs of Mixed Rare Earth Carbonate (MREC) samples which are being used in the Company’s negotiations on off-take agreements. Prospective customers can test and evaluate the product specifications from Yangibana. As rare earth prices, and particularly, Nd-Pr continue to recover in 2017, the very high percentage of Nd & Pr achieved in the piloting will offer attractive product specification to many high-tech product manufacturers. Hastings recently announced the final DFS drilling programme to upgrade current Inferred Resources to Measured and Indicated Resources and additional drilling at new prospects which were previously identified. Both efforts are being undertaken to support a 10-year mining operation. The Company has also engaged with strategic institutional investors and debt financiers to secure senior project financing. Hastings will continue to explore sourcing senior financing from Engineering, Procurement and Constructing (EPC) finance institutions, traditional banks and alternative debt providers. The nature of the senior debt may likely be a combination of traditional bank loans, mezzanine and EPC finance. Hastings has also recently received a Research and Development tax offset rebate of $1.5 million for the year ended 30 June 2016. A further claim will be made in relation to the year ended 30 June 2017. Brockman The Brockman deposit contains JORC Indicated and Inferred Resources totalling 41.4 million tonnes (comprising 32.3mt Indicated Resources and 9.1mt Inferred Resources) at 0.21% TREO, including 0.18% HREO, plus 0.36% Nb₂O₅ and 0.90% ZrO₂. Given the focus on Yangibana, limited work is being undertaken on Brockman at present. During the year to date the Company has applied for Mining Licences over its ten tenements at Halls Creek, Western Australia. Should you have any questions in relation to this offer please contact the company secretary, Guy Robertson on +61 2 9078 7671 or seek your own financial advice. Yours faithfully, Guy Robertson Company Secretary Offer Booklet - 2017 SPP Final2_ja amendments 3453-9157-7861, v. 2 Page 6 Hastings Technology Metals Ltd ABN 43 122 911 399 Share Purchase Plan - Terms and Conditions 1 THE OFFER 1.1 The Offer The Offer is an invitation to all Eligible Shareholders, made under ASIC Class Order 09/425 (Class Order), to subscribe for New Shares at the Offer Price of 8.6 cents per New Share, up to a maximum subscription of 174,418 New Shares ($15,000) per Eligible Shareholder. You may choose not to accept the Offer or to accept a less amount. The Offer to each Eligible Shareholder is made on the same terms and conditions. The Offer is non-renounceable (i.e. you may not transfer your right to acquire a New Share to anyone else). The number of New Shares you receive will depend on the value of the parcel of New Shares you apply for and on the total number of New Shares applied for by all Eligible Shareholders. The Company reserves the right to scale back Applications or (subject to the Listing Rules) accept oversubscriptions where the total value of New Shares applied for by all Eligible Shareholders exceeds $5 million (see section 7 below). The Offer Price is fixed regardless of any changes in the market price of Shares during the Offer period. 1.2 Offer not taken up If you are an Eligible Shareholder and do not wish to subscribe for New Shares, you are not obliged to do anything. You will not receive any benefits or New Shares. The number of Shares you hold as at the Record Date and the rights attached to those Shares will not be affected if you choose not to participate in the Share Purchase Plan. All New Shares not subscribed for under the Share Purchase Plan will be taken up by the Underwriters at the Offer Price. 2 OPENING AND CLOSING DATES The Offer will open on 6 June 2017 and close on 26 June 2017. The Directors reserve the right to close the Offer early or extend the Closing Date (as the case may be) at their absolute discretion without any notice to you, subject to the Corporations Act and the Listing Rules. New Shares not subscribed for under the Plan will, subject to Shareholder approval, be taken up by the Underwriters at the Offer Price. Offer Booklet - 2017 SPP Final2_ja amendments 3453-9157-7861, v. 2 Page 7 3 ELIGIBILITY 3.1 Eligibility You are eligible to apply for the New Shares if: 3.2 (a) your registered address in the Company’s register of members is in Australia or New Zealand; and (b) you were registered as a holder of Shares in the Company as at 7.00pm (AEST) on 1 June 2017 (Record Date). Individual Shareholders If you are the sole registered Shareholder of a holding of Shares, but you receive more than one Offer under the Share Purchase Plan (for example, because you have multiple individual holdings of Shares), you may only apply for one parcel of New Shares with a value of up to $15,000. 3.3 Joint Shareholders If you are recorded with one or more other persons as the joint Shareholder of a holding of Shares, that joint Shareholding is considered to be a single registered Shareholding for the purpose of the Share Purchase Plan. The joint Shareholders are entitled to participate in the Share Purchase Plan for the single holding only. If the same joint Shareholders receive more than one offer under the Share Purchase Plan (i.e. due to joint Shareholders having multiple registered holdings), the joint Shareholders may only apply for one parcel of New Shares up to $15,000. 3.4 Custodians If you are a Custodian (as defined below) and hold Shares on behalf of one or more persons resident in Australia or New Zealand (each a Participating Beneficiary), you may be entitled to apply for up to $15,000 worth of Shares for each Participating Beneficiary provided each Participating Beneficiary is not in the United States and is not acting for the account or benefit of a person in the United States and subject to you providing a certificate to the Company containing the information prescribed by ASIC Class Order 09/425 as modified by ASIC Class Orders 10/105, 10/789, 11/162, 13/762, 13/854, 14/757 and 14/977 (Custodian Certificate). If you are a Custodian and would like a Custodian Certificate or further information on how to apply, you should contact the share registry, Security Transfer Australia Pty Limited (within Australia) on 1300 992 916 or (outside Australia) on +61 3 9628 2200. In providing the Custodian Certificate under this section 3.4, the Custodian may rely on information provided to it by the Participating Beneficiary and any person who holds beneficial interests in the Shares held by the Custodian. If you are a Custodian and you hold Shares on the Record Date jointly on behalf of 2 or more persons: (a) the $15,000 limit applies in relation to that joint holding as if you held the Shares on behalf of a single person; and Offer Booklet - 2017 SPP Final2_ja amendments 3453-9157-7861, v. 2 Page 8 (b) you are taken to have been instructed to apply for Shares on behalf of those persons if: (i) you have received such an instruction in accordance with the terms on which the Shares are held; or (ii) where the terms on which the Shares are held do not cover the giving of instructions of this kind, you have received such an instruction from any of those persons. If you, as a Custodian, are not able to provide the Custodian Certificate, then the maximum you, as an eligible Custodian, may invest under the Share Purchase Plan in all capacities is A$15,000. 3.5 Trustee or nominee If you hold Shares as a trustee or nominee for another person, but are not a Custodian, you cannot participate for beneficiaries in the manner described in section 3.4. In this case, the rules for multiple single holdings set out in sections 3.2 and 3.3 apply. 3.6 Directors and employees Directors and employees of the Company who hold Shares and are Eligible Shareholders may participate in the Offer in accordance with its terms. 3.7 Treatment of overseas Shareholders The Offer is not being extended to any Shareholder, as at the Record Date, whose registered address is not situated in Australia or New Zealand and no action has been taken to register the New Shares or the Offer or otherwise to permit an offering of the New Shares in any jurisdiction outside those jurisdictions. Recipients may not send or otherwise distribute this document or the Application Form to any person outside Australia (other than to Eligible Shareholders or Participating Beneficiary). Shareholders who hold Shares on behalf of persons who reside outside Australia or New Zealand, are in the United States, or are acting for the account or benefit of a person in the United States are not entitled to participate in the Share Purchase Plan on behalf of those persons. A trustee, nominee or custodian must not participate in the Share Purchase Plan on behalf of, nor distribute this document or any other document relating to the Share Purchase Plan to, any person in the United States. Failure to comply with these restrictions may result in violations of applicable securities law. The Offer to Eligible Shareholders with registered addresses in New Zealand is made in reliance on the Securities Act (Overseas Companies) Exemption Notice 2013 (New Zealand). In accordance with relevant New Zealand securities law, a person who, on the Record Date, was on the register as a Shareholder but on the Opening Date no longer holds Shares, is not eligible to participate in the Share Purchase Plan. Neither these terms and conditions nor the Application Form constitutes an offer in the United States (or to, or for the account or benefit of, US Persons). This document is not for publication or distribution, directly or indirectly, in or into the United States of America (including its territories and possessions, any state of the US and the District of Columbia). This document is not an offer of securities for Offer Booklet - 2017 SPP Final2_ja amendments 3453-9157-7861, v. 2 Page 9 sale into the United States or to, or for the account of benefit of, US Persons. The securities referred to in this document have not been and will not be registered under the US Securities Act and may not be offered or sold in the United States or to, or for the account or benefit of, US Persons. No public offering of New Shares is being made in the United States. 3.8 Representation by Applicants By returning a completed Application Form or paying the Offer Price for New Shares by BPay®, you will be taken to represent, warrant and agree: (a) you, and each person for whose account or benefit you are acting, are an Eligible Shareholder and eligible under all securities law to receive an Offer and represent and warrant you are not: (i) in the United States and are not acting for the account or benefit of a person in the United States; or (ii) otherwise a person to whom it would be illegal to make an offer or issue of Shares under the Share Purchase Plan; (b) you have read and understood these terms and conditions and you subscribe for New Shares in accordance with, and subject to, these terms and conditions; (c) you accept you will not be able to withdraw or revoke your Application or BPAY® payment once you have sent it in; (d) you authorise the Company to correct minor errors in the Application Form if required, and to complete the Application Form by inserting any minor missing details; (e) the Company may at any time determine your Application Form is valid, in accordance with these Terms and Conditions, even if the Application Form is incomplete, contains errors or is otherwise defective; (f) you are responsible for any dishonour fees or other costs the Company may incur in presenting a cheque for payment which is dishonoured; (g) the Company has not provided you with taxation, investment advice or financial product advice, and it does not have any obligation to provide this advice, concerning your decision to apply for and buy New Shares; (h) you acknowledge the Company is not liable for any exercise of its discretions referred to in these terms and conditions; (i) the market price of Shares may rise or fall between the date of this Offer and the Issue Date and the Offer Price paid for the New Shares may exceed the market price of the New Shares on the Issue Date; (j) the New Shares have not been, and will not be, registered under the US Securities Act or the securities laws of any state or other jurisdiction in the US, or in any other jurisdiction outside Australia or New Zealand, and may not be offered, sold, transferred or otherwise disposed of except in accordance with an available exemption form, or in a transaction not subject to, the registration requirements of the US Securities Act and any other applicable securities laws; Offer Booklet - 2017 SPP Final2_ja amendments 3453-9157-7861, v. 2 Page 10 4 (k) you have not and will not send this document or the Application Form to any person in the United States or that is, or is acting for the account or benefit of, a US Person; and (l) if in the future you decide to sell or otherwise transfer their New Shares, you will only do so in transactions conducted in the ordinary course on ASX where neither you nor any person acting on your behalf knows, or has reason to know, the sale has been pre-arranged with, a purchaser which is in the United States or is a US Person. OFFER PRICE The Company is inviting Eligible Shareholders to apply for 58,139,534 New Shares at the Offer Price to raise $5 million before costs. The Offer Price of 8.6 cents is equal to the volume weighted market price for Shares traded on ASX calculated over the last five days on which sales in Shares were recorded before the Announcement Date. 5 RIGHTS The rights and obligations of the New Shares are contained in the constitution of the Company which is available for inspection at the registered office of the Company during the Offer period. The New Shares will be issued with the same terms as all existing Shares and the New Shares will rank equally with existing Shares quoted on ASX. The Company will apply for the New Shares to be quoted on ASX. 6 NUMBER OF NEW SHARES The maximum number of Shares offered under the Plan is 58,139,534 Shares, representing total proceeds of $5 million. Each Eligible Shareholder has the right to apply for up to a maximum of 174,418 New Shares for a consideration of $15,000. Eligible Shareholders may select one of the following alternatives: Offer Booklet - 2017 SPP Final2_ja amendments 3453-9157-7861, v. 2 Page 11 Offer Value Number of Shares A $2,500 29,069 B $5,000 58,139 C $7,500 87,209 D $10,000 116,279 E $12,500 145,348 F $15,000 174,418 The maximum New Shares purchased by each Eligible Shareholder (including through joint holdings, multiple share accounts or any holding in which they have a beneficial interest) must not exceed the value of $15,000. The Directors reserve the right to issue to an Eligible Shareholder less New Shares than the number specified in the Application Form (scaled back as set out below) including the possible subscription of over $15,000 worth of New Shares by an Eligible Shareholder through multiple Applications or joint holdings. No fractions of New Shares will be issued. Any fraction of a New Share will be rounded down to the nearest whole number of New Shares. 7 SCALE BACK AND OVERSUBSCRIPTION In the event valid Applications are received in excess of the maximum amount, the Directors may in their absolute discretion undertake a scale-back pro-rata to applications and allocate an Eligible Shareholder a smaller number of New Shares than an Eligible Shareholder has applied for. The Company also reserves the right to accept oversubscriptions, subject to compliance with all laws, regulations, ASIC class orders, requirements or policies or any ASX Listing Rule. If there is a scaleback, you may not receive all the New Shares for which you have applied. If a scaleback produces a fractional number when applied to your Application, the number of New Shares you will be issued will be rounded down to the nearest whole number of New Shares. Where the number of New Shares issued to an Eligible Shareholder is less than the number applied for, surplus moneys will be refunded by cheque as soon as practicable after the Issue Date. Interest will not be paid on moneys refunded. If the Offer is oversubscribed, the Directors reserve the right to close the Offer early. 8 UNDERWRITING Equator Capital Management Pte Limited (a company in which Charles Lew, Executive Chairman is a director and shareholder) and Roger Fong, a shareholder, have agreed to severally underwrite the Offer by agreeing to take up (or have sub-underwriters take up) Offer Booklet - 2017 SPP Final2_ja amendments 3453-9157-7861, v. 2 Page 12 shortfall Shares at the Offer Price as to 50% each, subject to the terms of the Underwriting Agreement. The Underwriting Agreement contains customary conditions, warranties and undertakings and is subject to various termination events exercisable by the Underwriter. Should the Underwriting Agreement for any reason be terminated, the Company intends to proceed with the SPP, accepting all valid Applications. 9 PARTICIPATION COSTS You must pay the Offer Price and any fees or charges incurred by you in completing the Application Form (for example, bank fees or fees of professional advisers). The Company will pay any brokerage or stamp duty. 10 APPLICATION MONEY AND ISSUE OF NEW SHARES 10.1 Application money All Application money received before the New Shares are issued will be held in a special purpose account. After any Application money is refunded (if required) and New Shares are issued to Applicants, the balance of funds in that account plus accrued interest will be received by the Company. 10.2 Issue of New Shares Subject to ASX granting the New Shares official quotation, it is expected the New Shares will be quoted on the