Announcement PDF REPLACEMENT PROSPECTUS For an offer with a minimum subscription of 16,000,000 New Shares to raise $4,000,000 (before costs) and a maximum subscription of 20,000,000 New Shares to raise $5,000,000 (before costs) in the Company at an issue price of $0.25 per New Share, together with 1 free attaching unquoted Option for every 2 New Shares subscribed exercisable within 2 years of issue at a strike price of $0.30. This document is important and should be read in its entirety. If you are in any doubt as to the contents of this document, you should consult your sharebroker, solicitor, professional adviser, banker or accountant without delay. The securities offered by this Prospectus are considered to be highly speculative. Corporate Advisor: Contents 1. Investment Overview 9 2. Details of the Offer 23 3. Company Overview 37 4. Financial Information 65 5. Independent Limited Assurance Report 84 6. Solicitor’s Tenement Report 89 7. Board, Management and corporate governance 90 8. Risk factors 105 9. Additional information 117 10. Definitions 135 11. Corporate Directory 142 Schedule 1 - Independent Geologist Report 143 Schedule 2 - Solicitor’s Tenement Report 144 Application Form 145 REPLACEMENT PROSPECTUS Important Information Offer This Replacement Prospectus (Replacement Prospectus or Prospectus) is issued by AKORA Resources Limited ACN 139 847 555 (Company). The Offer contained in this Prospectus is an invitation to investors to subscribe for fully paid ordinary shares (New Shares) at $0.25 per New Share (Offer Price) and to receive one free attaching unquoted Option (Attaching Option) for every two New Shares subscribed for in the Company (General Offer). The terms of the New Shares and the Attaching Options (together, Offer Securities) are summarised in Sections 9.3 and 9.4 respectively. Pursuant to this Prospectus, the Company also invites broker firms to subscribe for New Shares and Attaching Options on the same terms as the General Offer (Broker Firm Offer). Together, the General Offer and the Broker Firm Offer comprise the Offer. Lodgement and listing This Replacement Prospectus is dated Thursday, 12 November 2020 and was lodged with the Australian Securities and Investments Commission (ASIC) on that date (Prospectus Date). This Replacement Prospectus replaces the prospectus dated Wednesday, 21 October 2020 (Original Prospectus), a copy of which was lodged with ASIC on that date (Original Prospectus Date). For the purposes of this document, the Replacement Prospectus will be referred to as either the ‘Replacement Prospectus’ or ‘Prospectus’. Neither ASIC, nor the Australian Securities Exchange (ASX) nor their respective officers take any responsibility for the contents of this Prospectus or the merits of the investment to which this Prospectus relates. This Prospectus differs from the Original Prospectus and has been issued to, amongst other things: (a) provide updated disclosure regarding the Company’s tenements and in the Independent Geologist Report (IGR); (b) update reliance wording in the Solicitor’s Tenement Report; (c) update disclosure in respect of the fee payable to the Lead Manager; (d) include an updated Independent Limited Assurance Report; (e) update accompanying notes to the Use of Funds tables in the ‘Investment Overview’ and Section 2.5; and (f) update the risk section regarding site access (see Section 8). No Offer Securities will be allotted or issued on the basis of this Prospectus later than the expiry date of the Original Prospectus being the date which is 13 months after the Original Prospectus Date. The Offer Securities allotted or issued pursuant to the Offer will be on the terms and conditions set out in this Prospectus. The Company applied to ASX within seven days of the Original Prospectus Date for admission to the Official List (Admission) and for quotation on the ASX of the New Shares offered under this Prospectus. Not investment advice The information contained in this Prospectus is not financial product advice and does not take into account your investment objectives, financial situation or particular needs. In making an investment decision, potential investors must rely on their own examination of the Company and the terms of the Offer, including the merits and risks involved. The contents of this Prospectus are not to be construed as legal, business or tax advice. Before deciding to apply for Offer Securities, potential investors should read the entire Prospectus and in particular, in considering the prospects for the Company, investors should consider the risk factors that could affect the financial performance of the Company. Some of the key risk factors that should be considered by prospective investors are set out in Section 8. There may be risk factors in addition to these that should be considered in light of your personal circumstances. Prospectus – AKORA Resources Ltd 1 The Company is at the early stages of its maturity and the risks may therefore be significant. The Offer Securities offered pursuant to this Prospectus should be considered highly speculative. Investors should carefully consider these factors in light of personal circumstances (including financial and taxation issues) and seek professional advice from an accountant, stockbroker, lawyer or other professional adviser before deciding whether to participate in the Offer. Disclaimer Except as required by law, and only to the extent required, no person named in this Prospectus, nor any other person, guarantees the performance of the Company, the repayment of capital by the Company, or the payment of a return on the New Shares. No person is authorised to give any information or to make any representation in connection with the Offer described in this Prospectus which is not contained in this Prospectus. Any information or representation not so contained may not be relied on as having been authorised by the Company, the Lead Manager or any other person in connection with the Offer. Forward looking statements This Prospectus may contain forward looking statements, which may be identified by words such as “may”, “could”, “believes”, “estimates”, “expects” or “intends” and other similar words that connote risks and uncertainties. Certain statements, beliefs, and opinions contained in this Prospectus, in particular those regarding the possible or assumed future financial or other performance, industry growth or other trend projections are only predictions and subject to inherent risks and uncertainties. No financial forecasts have been prepared. Except as required by law, and only to the extent so required, neither the Company, its Board nor any other person gives any assurance that the results, performance or achievements expressed or implied by the forward looking statements contained in this Prospectus will actually occur and investors are cautioned not to place undue reliance on such forward looking statements. Any forward looking statements are subject to various risk factors, many of which are beyond the control of the Company and its Board that could cause the Company’s actual results to differ materially from the results expressed or anticipated in these statements. These statements are based on an assessment of present economic and operating conditions, and on a number of assumptions regarding future events and actions that, as at the Prospectus Date, are expected to take place. Forward looking statements should be read in conjunction with risk factors set out in Section 8 and other information in this Prospectus. The Company has no intention to update or revise forward-looking statements, or to publish prospective financial information in the future, regardless of whether new information, future events or any other factors affect the information contained in this Prospectus, except where required by law or the Listing Rules. This Prospectus, including the industry overview in Section 3.7, uses market data and third party estimates and projections. There is no assurance that any of the third party estimates or projections contained in this information will be achieved. The Company has not independently verified this information. Competent Person statement This information in this Prospectus relates to a technical assessment of the mineral assets, exploration targets and exploration results and is based on, and fairly represents, information and supporting documentation compiled, or reviewed, by Mr Mark Kenwright, BSc MSc MCSM, FAusIMM CP (Geo) who is an Associate Director with Wardell Armstrong International (Wardell Armstrong), an internationally recognised independent minerals industry consultancy. Mr Kenwright is a fellow of the Australasian Institute of Mining and Metallurgy. Mr Kenwright has sufficient experience relevant to the style of mineralisation and type of deposit under consideration, and to the activity for which he has undertaken, to qualify as a Practitioner as defined in the 2015 edition of the ‘Australasian Code for the Public Reporting of technical assessments and valuations of mineral assets’ and as a Competent Person as defined in the JORC Code. Mr Kenwright consents to the inclusion of the matters based on his information in the form and context in which it appears in this Prospectus and has not withdrawn his consent before lodgement of this Prospectus with the ASIC. Exploration Targets All exploration targets and exploration results set out in this Prospectus have been prepared and reported in accordance with the JORC Code. Any exploration targets in this Prospectus cannot be considered as a Mineral Resource as defined in the JORC Code. Any exploration targets are conceptual in nature and there has been insufficient exploration carried out to estimate a Mineral Resource and it is uncertain if further exploration will result in the exploration targets being delineated as a Mineral Resource. Prospectus – AKORA Resources Ltd 2 Overseas restrictions This Prospectus does not constitute an offer or invitation in any place in which, or to any person to whom, it would not be lawful to make such an offer or invitation. No action has been taken to register or qualify the Offer Securities or the Offer, or to otherwise permit a public offering of the Offer Securities in any jurisdiction outside Australia. The distribution of this Prospectus outside Australia may be restricted by law and persons who come into possession of this Prospectus outside Australia should seek advice on and observe any such restrictions. Any failure to comply with such restrictions may constitute a violation of applicable securities laws. This Prospectus has been prepared for publication in Australia and subject to certain limited exceptions, may not be released or distributed in the United States. This Prospectus does not constitute an offer to sell, or a solicitation of an offer to buy, securities in the United States. The Offer Securities have not been, and will not be, registered under the U.S. Securities Act of 1933, as amended (U.S. Securities Act), or any state securities laws of any state in the United States, and, unless so registered, may not be offered or sold within the United States, or to, or for the account or benefit of a US Person or U.S. Persons, except pursuant to an exemption from, or in a transaction exempt from or not subject to, the registration requirements of the U.S. Securities Act and applicable United States state securities laws. The Offer Securities offered hereby have not been approved or disapproved by any securities regulatory authority of any state in the United States or by the U.S. Securities and Exchange Commission (SEC), nor has any such authority or commission passed on the accuracy or adequacy of this Prospectus. Any representation to the contrary is a criminal offense under U.S. law. The Offer is not being extended to any investor outside Australia unless otherwise expressly stated. This Prospectus does not constitute an offer or invitation to potential investors to whom it would not be lawful to make such an offer or invitation. For details of selling and transfer restrictions that apply to the Offer Securities in certain jurisdictions outside of Australia, please see below and Section 2.15. Electronic Prospectus and Applications The Company has issued both a printed and an electronic version of this Prospectus and the electronic version (Electronic Prospectus) may be accessed on the Company’s website, https://www.akoravy.com/. The Offer pursuant to an electronic Prospectus is only available to persons receiving an electronic version of this Prospectus within Australia. It is not available to persons in other jurisdictions. Persons who access the Prospectus in electronic form should ensure that they download and read the entire Prospectus. Applications for Offer Securities may only be made during the Offer Period on the Application Form attached to or accompanying this Prospectus in its hard copy form, or in its soft copy form which must be downloaded in its entirety from: https://www.akoravy.com. The Corporations Act prohibits any person from passing to another person the Application Form unless it is attached to, or accompanies the complete and unaltered version of, this Prospectus. No cooling–off rights Cooling–off rights do not apply to an investment in Offer Securities pursuant to the Offer. This means that once an Application Form is submitted, an Applicant cannot decide to withdraw the Application except as permitted by law. Website The Company’s website and its contents do not form part of this Prospectus and is not to be interpreted as part of, nor incorporated into, this Prospectus, which should form the basis of your investment decision. Photographs, diagrams and tables Photographs used in this Prospectus that do not have descriptions are for illustration only and should not be interpreted to mean that any person shown endorses this Prospectus or its contents or that the assets shown in them are owned by the Company. Diagrams used in this Prospectus are illustrative only and may not be drawn to scale. Where there is a photograph, diagram or table attributed to a source, the author of the source has not provided their consent for the photograph, diagram or table to be included in this Prospectus. Proximate statements The Letter from the Chairperson and Sections 1 and 3 of this Prospectus may contain references to other parties either nearby or proximate to the Projects and include references to nearby iron mineralisation. It is important to note that such proximate production, discoveries or geological similarities do not in any way guarantee that the Company will have any success or similar successes in delineating JORC resources on the Projects. Prospectus – AKORA Resources Ltd 3 Financial amounts All financial amounts shown in this Prospectus are expressed in Australian dollars, unless otherwise indicated. A reference to $ is to Australian dollars unless otherwise indicated. Any discrepancies between totals and sums of components in tables contained in this Prospectus are due to rounding. Defined terms Certain capitalised terms and abbreviations used in this Prospectus have defined meanings which are explained in Section 10. Unless otherwise stated or implied, a reference to time in this Prospectus is to Melbourne, Australia time and references to dates or years are calendar year references. Privacy By filling out the Application Form to apply for Offer Securities, you are providing personal information to the Company through Link Market Services Limited ACN 083 214 537 (Share Registry), which is contracted by the Company to manage Applications. The Company, and the Share Registry on its behalf, may collect, hold, use and disclose that personal information for the purpose of processing your Application, servicing your needs as a Shareholder, providing facilities and services that you need or request and carrying out appropriate administration. If you do not provide the information requested in the Application Form, the Company and the Share Registry may not be able to process or accept your Application. Your personal information may also be used from time to time to inform you about other products and services offered by the Company which it considers may be of interest to you. Your personal information may also be provided to the Company’s agents and service providers on the basis that they deal with such information as authorised under the Privacy Act 1988 (Cth). The agents and service providers of the Company may be located outside Australia where your personal information may not receive the same level of protection as that afforded under Australian law. The types of agents and service providers that may be provided with your personal information and the circumstances in which your personal information may be shared are: (a) to the Share Registry for ongoing administration of the register of members; (b) to the Lead Manager in order to assess your Application; (c) printers and other companies for the purpose of preparation and distribution of statements and for handling mail; (d) to market research companies for the purpose of analysing the shareholder base and for product development and planning; and (e) legal and accounting firms, auditors, contractors, consultants and other advisers for the purpose of administering, and advising on, the Offer Securities and for associated actions. You may request access to your personal information held by (or on behalf of) the Company. You may be required to pay a reasonable charge to the Share Registry in order to access your personal information. You can request access to your personal information by writing to or by telephoning the Share Registry as follows: Link Market Services Limited Locked Bag A14 Sydney South NSW 1235 Australia Email: registrars@linkmarketservices.com.au Phone: 1300 554 474 (within Australia) or +61 1300 554 474 during business hours. If any of your information is not correct or has changed, contact the Share Registry or the Company to update your information. In accordance with the requirements of the Corporations Act, information on the share register will be accessible by members of the public. Paper copies of Prospectus The Company will provide paper copies of this Prospectus (including any supplementary or replacement document) and the relevant Application Form to investors upon request and free of charge. Requests for a paper copy form should be directed to the Company Secretary at info@akoravy.com or +61 3 9381 0859. Prospectus – AKORA Resources Ltd 4 Offer management The Offer is managed by Harbury Advisors Pty Ltd ACN 625 265 965 AFS Representative Number 001265413 (Lead Manager). The Offer is not underwritten. Contacts If you require assistance to complete the Application Form, require additional copies of this Prospectus, or have any questions in relation to the Offer, you should contact the Share Registry on 1300 554 474 (within Australia) or +61 1300 554 474 during business hours. If you are uncertain as to whether acquiring Offer Securities is a suitable investment for you, you should seek professional advice from your accountant, stockbroker, lawyer or other professional adviser before deciding whether or not to invest. Prospectus – AKORA Resources Ltd 5 Key Offer Information Important Dates Prospectus Date Thursday, 12 November 2020 Opening Date of Offer Thursday, 12 November 2020 Closing Date Thursday, 26 November 2020 Allotment of Offer Securities (completion of the Offer) Friday, 4 December 2020 Expected date for despatch of holding statements Tuesday, 8 December 2020 Shares expected to begin trading on the ASX (on a normal settlement basis) Friday, 11 December 2020 The above dates are indicative only and may vary. The Company reserves the right to amend the indicative timetable, including by closing the Offer early or extending the Closing Date or accepting late Applications, without prior notice, subject to the requirements of the Listing Rules and the Corporations Act. Admission and the commencement of quotation of the Shares are subject to confirmation from the ASX. Prior to the Original Prospectus Date and as approved by Shareholders at the Company’s annual general meeting held on 31 August 2020, the Company completed a consolidation of its issued capital (on a 1 for 11 basis). Unless otherwise indicated, references to Securities in this Prospectus are on a post-consolidation basis. Key Offer Statistics Minimum Subscription Maximum Subscription 0.25 0.25 39,428,988 39,428,988 16,000,000 20,000,000 Attaching Options to be issued under 2 Offer 8,000,000 10,000,000 Total number of Shares on issue at 3 Admission 55,428,988 59,428,988 Total number of Options on issue at Admission 8,000,000 10,000,000 Amount to be raised under the Offer (before costs) $4,000,000 $5,000,000 $13,857,247 $14,857,247 Offer Price per New Share Total number of Shares on issue at the Prospectus Date New Shares to be issued under Offer Undiluted market capitalisation Notes: 1. 2. 3. 4. 4 1 Under the agreement with the Lead Manager (as summarised in Section 9.1(a)), for every 8 Shares issued to investors under the Offer whom are introduced by the Lead Manager (Manager Investors), 1 Attaching Option will be issued to the Lead Manager (or its nominee). The terms of the Attaching Options are set out in Section 9.4. Further, if at least $2,000,000 is raised under this Prospectus from Manager Investors, the Lead Manager or nominee will be issued 200,000 Shares. Please refer to Section 9.4 for the terms of the Attaching Options. This figure excludes any further Shares issued to the Lead Manager as described in note 1 above and assumes that no Shares are issued between the Prospectus Date and Admission. Calculated as the total number of New Shares on issue following Admission multiplied by the Offer Price, excluding any further Shares issued to the Lead Manager as described in note 1 above. Please note that the Directors estimate that approximately 1,500,000 Options (with an exercise price of $0.30 and a term of 2 years) and 200,000 Shares will be issued to the Lead Manager as consideration for capital raising services provided in connection with the Offer (at Minimum Subscription) or the issue of 2,000,000 Options (with an exercise price of $0.30 and a term of 2 years) and 200,000 Shares to the Lead Manager as consideration for capital raising Prospectus – AKORA Resources Ltd 6 services provided in connection with the Offer (at Maximum Subscription). The numbers may vary depending on the amount of subscriptions received from Manager Investors (introduced by Harbury) and those introduced by the Company, which will not be known until the Closing Date. In addition the Company’s implementation of its allocation policy may impact on the final numbers. Please refer to page 80 of Section 4 for further details. Applications for the Offer Securities can only be made by completing and lodging the Application Form attached to or accompanying this Prospectus. Instructions on how to apply for Offer Securities are set out in Section 2.12 and on the back of the Application Form for the General Offer and Section 2.13 and on the back of the Broker Firm Application Form for the Broker Firm Offer. Prospectus – AKORA Resources Ltd 7 Letter from the Chairperson Dear Investor, On behalf of the Board of Directors, I am pleased to offer you the opportunity to become a shareholder in AKORA Resources Limited (AKORA or Company). AKORA holds iron mineralisation tenements in Madagascar; our 1 flagship project is the 100% owned Bekisopa – a high grade lump direct ship iron mineralisation prospect in south central Madagascar. The Company also holds additional promising iron mineralisation tenements near the east coast of Madagascar, named Tratramarina (100% owned) and Ambodilafa (90% beneficially owned as to prospective iron ore commodities). AKORA’s highlights from the Independent Geologist Report for Bekisopa show: 1. 2. 3. 4. Mineralisation interpreted as being a series of parallel layers of massive magnetite-hematite, of structural origin, with host rock containing coarse magnetite between those high-grade layers. Magnetics show extensive anomalies along the 7-kilometre strike extending +500m below surface with widths of 40m to 150m and dipping to the west. Based on these assessments and in conjunction with previous work, potential for high grade iron 2 mineralisation can be seen over a large strike and with considerable depth potential. Between and adjacent to the massive magnetite-hematite layers is disseminated magnetite-hematite mineralisation in the country rock, which grade ranges around 30 to 50% Fe and estimated potential 2 tonnage of this mineralisation of 500 to 1,000 million tonnes. Under this Prospectus the Company is seeking to raise a minimum of A$4,000,000 (before costs) via the issue of 16,000,000 New Shares and a maximum of $5,000,000 (before costs) via the issue of 20,000,000 New Shares at an issue price of A$0.25 per New Share, with one unquoted Attaching Option for every two New Shares subscribed for under the Offer, exercisable at A$0.30 within two years of issue. Harbury Advisors Pty Ltd is the Lead Manager of the Offer. Funds raised from the Offer will be used to undertake a focused 4,000m to 5,000m drilling programme with the objective of defining an initial JORC Resource at Bekisopa, further ground magnetic surveys to test mineral extension on tenements to the south west of our main Bekisopa tenements, mineralogy and mineral processing evaluations on the various ore types, corporate and administrative costs and working capital. This Prospectus contains detailed information about the Company, our projects, and the Offer, as well as the risks of investing in the Company. I ask that prospective investors take the time to read this Prospectus carefully to gain a full appreciation of the quality of the Company’s assets. As Chairman, I have had direct involvement with our experienced board and management team for a number of years and I have been fortunate to have visited Tratramarina and oversaw funding for AKORA’s projects while a partner of one of the Company’s substantial shareholders, Pacific Road Capital. Before you make your investment decision, I urge you to read this Prospectus in its entirety and seek professional advice if required. Yours sincerely, Mr Mike Stirzaker Chairman of AKORA Resources Limited 1 As at the Prospectus Date, the Company (via its wholly owned subsidiary) holds a 75% legal interest in the Bekisopa Project and the remaining 25% beneficial interest is held on trust for the wholly owned subsidiary of the Company. Accordingly, the Company via its wholly owned subsidiary holds the benefit of 100% of the Bekisopa Project. 2 These exploration targets are conceptual in nature as there has been insufficient exploration carried out to estimate a Mineral Resource and it is uncertain if further exploration will result in the exploration targets being delineated as a Mineral Resource. Prospectus – AKORA Resources Ltd 8 1. Investment Overview This Section is not intended to provide all information for investors intending to apply for Offer Securities. This Prospectus should be read and considered in its entirety, including the risk factors set out in Section 8. The Offer Securities offered under this Prospectus carry no guarantee in respect of return of capital, return on investment, payment of dividends or future value. Topic Summary Reference THE COMPANY AND BUSINESS OVERVIEW Who is the issuer of this Prospectus? AKORA Resources Limited ACN 139 847 555 (Company) is a public company incorporated on 6 October 2009 in Victoria, Australia. Section 3 What is nature of Company’s business? Iron ore exploration in Madagascar. Section 3 (a) Section 3 the the What are the key strengths and competitive advantages of the Company? The Company has acquired three tenement packages with iron mineralisation potential. The Company holds the tenements over land of some 308 km2 within the emerging Archean iron mineralisation province of central and eastern Madagascar. The region is widely acknowledged to host extensive iron-bearing rock formations. The Company has consolidated tenements over priority target areas and is aiming to complete further tenement acquisitions in the future. (b) The Projects have favourable locations By comparison to certain other predevelopment prospective iron ore projects, the Projects benefit from reasonable proximity to deep-water coastline. Both the Ambodilafa Project and Tratramarina Project are located less than 50km and 16km respectively from the coast. (c) Potential for the development of marketable iron ore products The Directors and the Independent Geologist believe the Bekisopa Project has the potential for DSO lump iron ore, refer to the Executive Summary on page 5 of the IGR at Schedule 1. With the presence of coarse high- grade magnetite within the country rock adjacent to the massive magnetite-hematite layers then with crushing, coarse grinding, some normal sorting and washing could produce an added value product for sale. Furthermore, the primary magnetite could be amenable to relatively simple concentration to produce a high grade, low impurity Prospectus – AKORA Resources Ltd 9 Topic Summary product. (d) Reference Experienced management The Board has significant technical, commercial, financial experience within the mining industry as well as working in developing countries. (e) Independent Geologist Report and strategy In 2017 and 2020 the Company commissioned Wardell Armstrong to prepare an independent geologist report on the Projects. The full report dated 10 November 2020, is set out in full at Schedule 1. How did the Company obta