South Harz Potash Ltd (ASX:SHP) is seeking to add up to $500,000 to its recent $2.6 million placement through a share purchase plan (SPP) which will open to eligible shareholders tomorrow.
If fully subscribed, the SPP will take total capital-raising proceeds to $3.13 million, which includes $2.415 million from the placement and another $215,000 pledged by directors of the company and their related parties but is subject to shareholder approval.
READ: South Harz Potash secures $2.6 million to advance Ohmgebirge Potash Project studies; launches SPP
The placement to new and existing institutional and sophisticated investors was completed on August 10, 2023, with 80,493,996 fully paid ordinary shares in the company issued at $0.03 per share.
This includes one free attaching unlisted option to acquire one share exercisable at $0.08 and expiring on August 10, 2026, for every four shares subscribed for and issued.
SPP details
To provide eligible shareholders with the ability to participate in the capital raising activities, SHP is offering the opportunity to purchase up to $30,000 worth of shares at $0.03 per share, irrespective of the size of their shareholding in the company, without incurring brokerage or transaction costs.
This is the same issue price as the shares offered to sophisticated and professional investors under the placement.
It represents a discount of 18% to $0.037, being the volume-weighted average market price (VWAP) of the shares over the last five trading days on which sales in the shares were recorded before the day on which the SPP was announced on August 2, 2023.
Use of funds
The funds raised under the placement and the SPP will be used to fund:
- Progression and completion of the PFS on the company’s flagship Ohmgebirge Potash Development in Germany;
- Environmental baseline study work and permitting process advancement;
- Early commencement of selected Ohmgebirge DFS workstreams; and
- General working capital.
At the time of closing the placement, South Harz Potash CEO Luis da Silva said: “The funds raised via the placement and SPP are expected to facilitate the ongoing advancement of our Ohmgebirge Potash Development, including completion of the pre-feasibility study (PFS) currently in progress.
“Our work to date continues to affirm the world-class nature of Ohmgebirge and its strong potential to leverage existing regional infrastructure and a genuine brownfield development pathway.
“We look forward to providing further updates as key outcomes are progressively concluded and the PFS advances towards targeted completion later this year.”
For eligible shareholders
South Harz Potash may elect to accept oversubscriptions or alternatively close the SPP offer early and/or scale back applications, at its absolute discretion.
The maximum number of shares that can be issued under an SPP is that amount equal to 30% of the company’s existing issued share capital. Accordingly, the maximum number of shares which will be issued will be 204,151,927.
Participation is optional and is available exclusively to shareholders of the company who are registered as holders of shares as at 5:00pm AWST on August 1, 2023, and whose registered address is in Australia or New Zealand.
Eligible shareholders will also receive one free attaching option for every four shares subscribed for and issued under the plan, which will not be underwritten.
Each free attaching option will be on the same terms as the options issued under the placement.