Announcement PDF ASX Announcement – 24 March 2015 ENTITLEMENT OFFER OF SHARES The Directors of Variscan Mines Limited (“Variscan” or “Company”) (ASX: VAR) are pleased to advise that the Company intends to undertake a pro-rata renounceable issue of new ordinary shares (“New Shares”) at an offer price of $0.015 (“Offer Price”) per New Share. This offer is for four New Shares for every three fully paid ordinary shares in the Company (Shares) held by eligible shareholders and one option (“New Option”) for every New Share subscribed for at an exercise price equal to the Offer Price and expiring two years after the date of issue (“Entitlement Offer”). It is expected that the Entitlement Offer will raise up to $3.515 million before offer costs which the Company intends using to continue with its successful strategy of identifying and securing advanced projects in Europe (notably France) and initiating exploration to discover economic deposits. Specifically, Variscan is seeking to use the funds raised under the offer to: Drill the high grade Porte-aux-Moines zinc/lead/copper/silver/gold VMS deposit within the Merléac project and generate a resource estimate prepared under the guidelines of the JORC 2012 Code. Complete a heli-borne EM survey over the southern half of the Merléac licence to define the location and geometry of potential VMS deposits beneath known gossan s and below cover. Drill key targets defined from the EM and geochemical work at Merléac. Continue soil sampling over key prospects at the St Pierre Gold Project. Possibly commence shallow drilling of gold targets at St Pierre. Progress the five current PER applications to successful grant. Continue project generation activities in France. General working capital to be used in Variscan’s exploration business. The Company’s major shareholder, Mr Kwan Chee Seng, who has a relevant interest in 29.89% of the Company’s voting Shares at the date of this announcement, has indicated in writing to the Company that he intends to take up his entitlement of approximately 52.5 million New Shares and New Options at a cost of approximately $1,050,531. Entitlement Offer Under the proposed Entitlement Offer, eligible shareholders will be invited to subscribe for four New Shares and four attached New Options for every three Shares held at 7.00pm on 30 March 2015 (Record Date) at an Offer Price of $0.015 per New Share. Each New Option has an exercise price equal to the Offer Price expiring two years after the date of issue. ASX Code: VAR Web - www.variscan.com.au The Offer Price of $0.015 per New Share represents a 48.28% discount to the closing market price of the Shares on 20 March 2015. The Offer Price represents a 46.32% discount to the volume weighted average price (VWAP) over the last five trading days (fifteen day VWAP: 46.73%) on which the Shares traded to 20 March 2015, being prior to the announcement of the Entitlement Offer. Based on the capital structure of the Company as at the date of this announcement, and assuming no current options in the Company (Options) are exercised prior to 30 March 2015, a maximum of 234,316,347 New Shares and 234,316,347 New Options will be issued pursuant to the Entitlement Offer. Persons who currently hold Options are only eligible to participate if they exercise their Options before 7.00pm (AEST) on 30 March 2015. Only shareholders that have a registered address in Australia, New Zealand or Singapore and who are registered on the Company’s share register at 7.00pm on the Record Date (30 March 2015) will be entitled to participate in the Entitlement Offer (Eligible Shareholders). The Company has decided that it is unreasonable to make offers under the Entitlement Offer to shareholders outside Australia, New Zealand and Singapore, having regard to the small number of such shareholders, their holdings, and the compliance costs required to offer the New Shares and New Options under the Entitlement Offer to those shareholders. The Entitlement Offer will be made to Eligible Shareholders pursuant to a prospectus (Prospectus), which will include a personalised Entitlement and Acceptance Form. The Prospectus will provide further details on how to participate in the Entitlement Offer. The Prospectus, together with the Entitlement and Acceptance Form, will be mailed to all Eligible Shareholders from 2 April 2015. Closing Date The Entitlement and Acceptance Forms, together with payment, must be received by the Company’s Share Registrar, Boardroom Pty Limited, by no later than 5:00pm AEST on 27 April 2015. Payment for the subscriptions under the Entitlement Offer can be made by BPAY® or cheque. Shortfall Offer The Company, in its sole discretion, may conduct a shortfall offer in respect of any New Shares not subscribed for pursuant to the Entitlement Offer (Shortfall Offer). In these circumstances, Eligible Shareholders may also apply for New Shares (with the attached New Options) under the Shortfall Offer. The Company may also issue New Shares and New Options under the Shortfall Offer to institutions and/or sophisticated and professional investors. The Entitlement and Acceptance Form contains information on how to apply for New Shares and New Options under the Shortfall Offer. Page | 2 ASX Announcement - 24 March 2015 Should the number of New Shares applied for under the Shortfall Offer exceed the amount of New Shares available for subscription, the allocation of New Shares (with attaching New Options) forming part of the Shortfall Offer will be determined at the sole discretion of the Company. Indicative Timetable for Entitlement Offer Event Date Lodgement of Prospectus with ASIC 24 March 2015 Notice to Shareholders and Optionholders+ 25 March 2015 Shares trade ex Entitlement commence trading 26 March 2015 Record Date for determining Entitlements 30 March 2015 Opening date and despatch of Prospectus to Shareholders 2 April 2015 Entitlement trading ends 20 April 2015 New Shares quoted on a deferred settlement basis 21 April 2015 Closing Date of Entitlement Offer 27 April 2015 Notify ASX of under subscriptions 30 April 2015 Despatch date 4 May 2015 Notes: * These dates are the latest dates on which each relevant event may take place. + Optionholders must be advised by this date of the Entitlements Offer and their inability to participate un less they exercise their Options. This timetable is indicative only and the Company reserves the right to vary it at any time without prior notice, subject to the ASX Listing Rules and the Corporations Act 2001 (Cth). An Appendix 3B for the proposed issue of the New Shares and New Options is attached. Yours faithfully ................................ Greg Jones Managing Director Page | 3 ASX Announcement - 24 March 2015 Appendix 3B Rule 2.7, 3.10.3, 3.10.4, 3.10.5 New issue announcement, application for quotation of additional securities and agreement Information or documents not available now must be given to ASX as soon as available. Information and documents given to ASX become ASX’s property and may be made public. Introduced 01/07/96 Origin: Appendix 5 Amended 01/07/98, 01/09/99, 01/07/00, 30/09/01, 11/03/02, 01/01/03, 24/10/05, 01/08/12 Name of entity VARISCAN MINES LIMITED ABN 16 003 254 395 We (the entity) give ASX the following information. Part 1 - All issues You must complete the relevant sections (attach sheets if there is not enough space). 1 +Class of +securities issued or to be issued 2 Number of +securities issued or to be issued (if known) or maximum number which may be issued  Fully paid ordinary shares  Options expiring on 4 May 2017. Up to 234,316,347 fully paid ordinary shares (Entitlement Shares) and up to 234,316,347 options (Entitlement Options) are to be issued under a pro rata renounceable entitlement offer (Entitlement Offer) as detailed in the announcement and prospectus lodged with ASX today, 24 March 2015. The exact number of Entitlement Shares and Entitlement Options under the Entitlement Offer is still to be finalised and is subject to the number of Entitlement Shares subscribed for by eligible shareholders and to final reconciliation and rounding. + See chapter 19 for defined terms. 01/08/2012 Appendix 3B Page 1 3 Principal terms of the +securities (eg, if options, exercise price and expiry date; if partly paid +securities, the amount outstanding and due dates for +convertible payment; if securities, the conversion price and dates for conversion) The Entitlement Shares are fully paid ordinary shares The Entitlement Options are exercisable at a price of $0.015 and will expire on 4 May 2017. The full terms and conditions are set out in the prospectus lodged with ASIC and ASX on 24 March 2015. 4 Do the +securities rank equally in all respects from the date of allotment with an existing +class of quoted +securities? If the additional securities do not rank equally, please state:  the date from which they do  the extent to which they participate for the next dividend, (in the case of a trust, distribution) or interest payment  the extent to which they do not rank equally, other than in relation to the next dividend, distribution or interest payment 5 Issue price or consideration Yes – the Entitlement Shares rank equally with existing fully paid ordinary shares. The Entitlement Options form part of a new class of options for which quotation is being sought. $0.015 per Entitlement Share Nil consideration for the issue of the Entitlement Options (however the option exercise price is $0.015) 6 Purpose of the issue (If issued as consideration for the acquisition of assets, clearly identify those assets) Proceeds of the Entitlement Offer will be used to continue with the company’s successful strategy of identifying and applying for advanced projects in Europe (notably France) and initiating exploration work to discover economic deposits. Further details on the use of funds are set out in Sections 5.1 and 5.5 of the Prospectus lodged with ASX on 24 March 2015 6a Is the entity an +eligible entity that has obtained security holder approval under rule 7.1A? Yes If Yes, complete sections 6b – 6h in relation to the +securities the subject of this Appendix 3B, and comply with section 6i 6b The date the security holder resolution under rule 7.1A was passed 27 November 2014 6c Number of +securities issued without security holder approval under rule 7.1 Nil 6d Number of +securities issued with security holder approval under rule 7.1A Nil 6e Number of +securities issued with security holder approval under rule 7.3, or another specific security holder approval (specify date of meeting) Nil 6f Number of securities issued under an exception in rule 7.2 Nil 6g If securities issued under rule 7.1A, was issue price at least 75% of 15 day VWAP as calculated under rule 7.1A.3? Include the issue date and both values. Include the source of the VWAP calculation. N/A 6h If securities were issued under rule 7.1A for non-cash consideration, state date on which valuation of consideration was released to ASX Market Announcements N/A 6i Calculate the entity’s remaining issue capacity under rule 7.1 and rule 7.1A – complete Annexure 1 and release to ASX Market Announcements Refer Annexure 1 + See chapter 19 for defined terms. 01/08/2012 Appendix 3B Page 3 7 8 Dates of entering +securities into uncertificated holdings or despatch of certificates Entitlement Shares issued under Entitlement Offer - 4 May 2015 Number all 410,053,939 Number and +class of +securities quoted on ASX (including the securities in section 2 if applicable) 234,316,347 (Subject to subscriptions, reconciliation rounding) the +Class Ordinary Shares Options exercisable at $0.015 expiring on 4 May 2017 final (Subject to quotation) and Number 9 10 +class Number and of all +securities not quoted on ASX (including the securities in section 2 if applicable) Dividend policy (in the case of a trust, distribution policy) on the increased capital (interests) +Class 6,250,000 25 November 2015 Options – exercise price 30 cents 4,650,000 25 November 2015 Options – Employee Share Option Plan exercise price 30 cents 2,300,000 31 October 2015 Options – Employee Share Option Plan exercise price 14 cents 10,000,000 4 December 2017 Directors Options –exercise price 7 cents 5,650,000 4 December 2017 Options – Employee Share Option Plan exercise price 7 cents N/A Part 2 - Bonus issue or pro rata issue 11 Is security required? holder approval No 12 Is the issue renounceable or nonrenounceable? 13 Ratio in which the will be offered +securities Under the Entitlement Offer, four Entitlement Shares for every three existing share held at the record date, together with one Entitlement Option for every one Entitlement Share subscribed for. 14 +Class of +securities to which the Fully paid ordinary shares and options to acquire ordinary shares. offer relates 15 +Record 16 Will holdings on different registers (or subregisters) be aggregated for calculating entitlements? date entitlements to determine Renounceable 7.00pm (Sydney time) 30 March 2015 No + See chapter 19 for defined terms. 01/08/2012 Appendix 3B Page 5 17 Policy for deciding entitlements in relation to fractions Where fractions arise in the calculation of shareholders’ entitlements under the Entitlement Offer they will be rounded down to the next whole number of Entitlement Shares. 18 Names of countries in which the entity has security holders who will not be sent new offer documents All countries other than Australia, New Zealand and Singapore Note: Security holders must be told how their entitlements are to be dealt with. Cross reference: rule 7.7. 19 Closing date for receipt acceptances or renunciations of 20 Names of any underwriters N/A 21 Amount of any underwriting fee or commission N/A 22 Names of any brokers to the issue Patersons Securities Limited ACN 008 896 311 23 Fee or commission payable to the broker to the issue $20,000 plus 6% of the gross amount raised pursuant to subscriptions for shortfall shares (exclusive of GST) 24 Amount of any handling fee payable to brokers who lodge acceptances or renunciations on behalf of security holders Included in the 6% (plus GST) mentioned in 23. 25 If the issue is contingent on security holders’ approval, the date of the meeting N/A 26 Date entitlement and acceptance form and offer documents will be sent to persons entitled 2 April 2015 27 If the entity has issued options, and the terms entitle option holders to participate on exercise, the date on which notices will be sent to option holders 25 March 2015 5.00pm Sydney time on 27 April 2015 + See chapter 19 for defined terms. Appendix 3B Page 6 01/08/2012 28 Date rights trading will begin (if applicable) 26 March 2015 29 Date rights trading will end (if applicable) 20 April 2015 30 How do security holders sell their entitlements in full through a broker? See section 2.7b & d of the Prospectus 31 How do security holders sell part of their entitlements through a broker and accept for the balance? See section 2.7c & d of the Prospectus 32 How do security holders dispose of their entitlements (except by sale through a broker)? Security holders may dispose of their entitlements on the ASX 33 +Issue date 4 May 2015 Part 3 - Quotation of securities You need only complete this section if you are applying for quotation of securities 34 Type of securities (tick one) (a) Securities described in Part 1 (b) All other securities Example: restricted securities at the end of the escrowed period, partly paid securities that become fully paid, employee incentive share securities when restriction ends, securities issued on expiry or conversion of convertible securities Entities that have ticked box 34(a) Additional securities forming a new class of securities The Entitlement Options will form a new class of security and the details below will be provided at the time of issue. Tick to indicate you are providing the information or documents 35 If the securities are equity securities, the names of the 20 largest holders of the  additional securities, and the number and percentage of additional securities + + + + held by those holders + See chapter 19 for defined terms. 01/08/2012 Appendix 3B Page 7 36 If the securities are equity securities, a distribution schedule of the additional  securities setting out the number of holders in the categories + + + 1 - 1,000 1,001 - 5,000 5,001 - 10,000 10,001 - 100,000 100,001 and over 37 + A copy of any trust deed for the additional securities  Entities that have ticked box 34(b) 38 Number of securities for which +quotation is sought 39 Class of +securities for which quotation is sought 40 Do the +securities rank equally in all respects from the date of allotment with an existing +class of quoted +securities? If the additional securities do not rank equally, please state:  the date from which they do  the extent to which they participate for the next dividend, (in the case of a trust, distribution) or interest payment  the extent to which they do not rank equally, other than in relation to the next dividend, distribution or interest payment 41 Reason for request for quotation now Example: In the case of restricted securities, end of restriction period (if issued upon conversion of another security, clearly identify that other security) Number +Class + See chapter 19 for defined terms. Appendix 3B Page 8 01/08/2012 42 Number and +class of all +securities quoted on ASX (including the securities in clause 38) + See chapter 19 for defined terms. 01/08/2012 Appendix 3B Page 9 Quotation agreement 1 +Quotation of our additional +securities is in ASX’s absolute discretion. ASX may quote the +securities on any conditions it decides. 2 We warrant the following to ASX.  The issue of the +securities to be quoted complies with the law and is not for an illegal purpose.  There is no reason why those +securities should not be granted +quotation.  An offer of the +securities for sale within 12 months after their issue will not require disclosure under section 707(3) or section 1012C(6) of the Corporations Act. Note: An entity may need to obtain appropriate warranties from subscribers for the securities in order to be able to give this warranty  Section 724 or section 1016E of the Corporations Act does not apply to any applications received by us in relation to any +securities to be quoted and that no-one has any right to return any +securities to be quoted under sections 737, 738 or 1016F of the Corporations Act at the time that we request that the +securities be quoted.  If we are a trust, we warrant that no person has the right to return the +securities to be quoted under section 1019B of the Corporations Act at the time that we request that the +securities be quoted. 3 We will indemnify ASX to the fullest extent permitted by law in respect of any claim, action or expense arising from or connected with any breach of the warranties in this agreement. 4 We give ASX the information and documents required by this form. If any information or document not available now, will give it to ASX before +quotation of the +securities begins. We acknowledge that ASX is relying on the information and documents. We warrant that they are (will be) true and complete. Sign here: Date: 24 March 2015 Company secretary Print name: Ivo Polovineo + See chapter 19 for defined terms. Appendix 3B Page 10 01/08/2012 Appendix 3B – Annexure 1 Calculation of placement capacity under rule 7.1 and rule 7.1A for +eligible entities Introduced 01/08/12 Part 1 Rule 7.1 – Issues exceeding 15% of capital Step 1: Calculate “A”, the base figure from which the placement capacity is calculated Insert number of fully paid ordinary securities on issue 12 months before date of issue or agreement to issue 175,737,592 Add the following: • Number of fully paid ordinary securities issued in that 12 month period under an exception in rule 7.2 Nil • Number of fully paid ordinary securities issued in that 12 month period with shareholder approval Nil • Number of partly paid ordinary securities that became fully paid in that 12 month period Nil Note: • Include only ordinary securities here – other classes of equity securities cannot be added • Include here (if applicable) the securities the subject of the Appendix 3B to which this form is annexed • It may be useful to set out issues of securities on different dates as separate line items Subtract the number of fully paid ordinary securities cancelled during that 12 month period Nil “A” 175,737,592 + See chapter 19 for defined terms. 01/08/2012 Appendix 3B Page 11 Step 2: Calculate 15% of “A” “B” 0.15 [Note: this value cannot be changed] Multiply “A” by 0.15 26,360,638 Step 3: Calculate “C”, the amount of placement capacity under rule 7.1 that has already been used Insert number of equity securities issued or agreed to be issued in that 12 month period not counting those issued: • Under an exception in rule 7.2 • Under rule 7.1A • With security holder approval under rule 7.1 or rule 7.4 Nil Note: • This applies to equity securities, unless specifically excluded – not just ordinary securities • Include here (if applicable ) the securities the subject of the Appendix 3B to which this form is annexed • It may be useful to set out issues of securities on different dates as separate line items “C” Step 4: Subtract “C” from [“A” x “B”] to calculate remaining placement capacity under rule 7.1 “A” x 0.15 26,360,638 Note: number must be same as shown in Step 2 Subtract “C” Note: number must be same as shown in Step 3 Nil Total [“A” x 0.15] – “C” 26,360,638 [Note: this is the remaining placement capacity under rule 7.1] + See chapter 19 for defined terms. Appendix 3B Page 12 01/08/2012 Part 2 Rule 7.1A – Additional placement capacity for eligible entities Step 1: Calculate “A”, the base figure from which the placement capacity is calculated “A” 175,737,592 Note: number must be same as shown in Step 1 of Part 1 Step 2: Calculate 10% of “A” “D” 0.10 Note: this value cannot be changed Multiply “A” by 0.10 17,573,759 Step 3: Calculate “E”, the amount of placement capacity under rule 7.1A that has already been used Insert number of equity securities issued or agreed to be issued in that 12 month period under rule 7.1A Nil Notes: • This applies to equity securities – not just ordinary securities • Include here – if applicable – the securities the subject of the Appendix 3B to which this form is annexed • Do not include equity securities issued under rule 7.1 (they must be dealt with in Part 1), or for which specific security holder approval has been obtained • It may be useful to set out issues of securities on different dates as separate line items “E” Nil + See chapter 19 for defined terms. 01/08/2012 Appendix 3B Page 13 Step 4: Subtract “E” from [“A” x “D”] to calculate remaining placement capacity under rule 7.1A “A” x 0.10 17,573,759 Note: number must be same as shown in Step 2 Subtract “E” Nil Note: number must be same as shown in Step 3 Total [“A” x 0.10] – “E” 17,573,759 Note: this is the remaining placement capacity under rule 7.1A + See chapter 19 for defined terms. Appendix 3B Page 14 01/08/2012