Native Mineral Resources Secures AU$3.5 Million Convertible Note from Lind Global Fund III to Support Debt and Growth Initiatives

Details of NMR’s Third AU$3.5 Million Convertible Note with Lind Global Fund III

Native Mineral Resources Holdings Limited has entered its third Convertible Security Funding Agreement with Lind Global Fund III LP, securing AU$3.5 million in funding before costs. As confirmed in the company update dated 2 July 2026, the transaction has closed and funds have been received, making capital immediately accessible. This deepens the ongoing partnership between NMR and Lind Partners, marking three consecutive convertible note arrangements with the gold producer.

Under the agreement, Lind Global Fund III LP invested AU$3.5 million in exchange for a convertible note with a face value of AU$4.2 million, reflecting a premium of AU$700,000 over the cash invested. A 2% commitment fee of AU$70,000 was deducted from the advanced funds, resulting in net proceeds slightly below AU$3.5 million. The note matures in 24 months, providing NMR with a defined period to manage repayments or pursue conversion.

Impact of 120-Day Repayment Holiday and AU$210,000 Monthly Instalments on NMR’s Cash Flow

A key feature for shareholders is the 120-day repayment holiday, during which no monthly repayments are required. This grants NMR approximately four months of uninterrupted access to the full proceeds before repayment obligations commence, allowing capital deployment toward operations and debt management.

After the holiday, the AU$4.2 million face value will be repaid via monthly instalments of AU$210,000. Repayments may be made in cash, shares, or a combination thereof. Share repayments are priced at 90% of the average of the five lowest daily volume-weighted average prices (VWAPs) over the 20 trading days preceding share issuance. Cash repayments incur a 4% premium. If shareholder approval for share issuance is not obtained when a repayment is due, NMR must repay in cash.

Fixed Conversion Price of AU$0.066 and Potential Share Dilution for Existing Shareholders

The convertible note grants Lind Global Fund III LP the right to convert the outstanding face value into fully paid ordinary shares at a fixed price of AU$0.066 per share at any time. Full conversion of the AU$4.2 million face value would result in the issuance of approximately 63.6 million shares, subject to agreement terms and rounding. This dilution is a significant consideration for current shareholders evaluating the facility’s impact.

NMR may repurchase the convertible note at face value at any time. However, if repurchased after 12 months, the investor retains the option to convert up to 20% of the remaining face value at the lower of AU$0.066 per share or the prevailing repayment price. Should NMR fail to obtain shareholder approval for conversion shares or comply with ASX Listing Rules, the investor may require a cash payment or exercise rights under the Share Pledge Agreement.

Security Package Includes BOC Holdings Collateral Shares, Yogi Bear Holdings Guarantee, and Port Macquarie Property Mortgage

The facility is secured by a multi-layered package, including existing Lind security from prior agreements, collateral shares from BOC Holdings Pty Ltd, a guarantee from Yogi Bear Holdings Pty Ltd, and a first-ranking mortgage over property at 15–19 Clarence Street, Port Macquarie. This comprehensive security reflects the risk profile typical in junior resource convertible note financing.

The involvement of third-party entities BOC Holdings and Yogi Bear Holdings adds complexity. The company did not disclose further details about these entities’ ownership or relationship to NMR.

Collins Street Payment Condition and Upcoming 14 July 2026 Deadline

Although funding is complete, one condition remains: Collins Street, an existing financier, has consented to the Lind transaction contingent on NMR making a payment by 14 July 2026 per its financing terms. The company expects to meet this obligation.

Details of the Collins Street financing were not disclosed. The 14 July deadline is imminent, making it a near-term event for investors to watch. Failure to meet this condition could affect the broader financing structure.

Allocation of Proceeds: Debt Management, Working Capital, and Growth Strategy Advancement

NMR plans to use proceeds for debt management, general working capital, and advancing growth initiatives. The dual focus indicates the facility supports both servicing existing obligations and maintaining operational momentum. No specific allocation breakdown was provided.

The growth strategy notably includes maximising the Blackjack Mill’s capacity. Lind Partners Founder Jeffrey L. Easton stated: "We are again happy to provide further support to NMR so that it may continue to grow its operations and maximise its Blackjack Mill capacity to mine and pour more gold to better shareholder value." No detailed production or capacity targets were disclosed.

Managing Director Blake Cannavo Highlights Flexibility and Growth Support

NMR Managing Director and CEO Blake Cannavo commented: "This facility provides NMR with immediate access to growth capital while preserving flexibility as the Company advances its operational and strategic objectives. We appreciate the continued support of Lind and the confidence shown in the Company's growth plans."

The emphasis on flexibility aligns with features such as the repayment holiday, share-based repayment options, and the company’s buy-back rights. The third consecutive facility with Lind Partners highlights the continuity of this funding source, though investors should consider cumulative dilution risks from multiple convertible instruments when assessing NMR’s capital structure.

Potential Follow-On Investment of Up to AU$4 Million: Conditions and Timeline

The agreement provides for a potential follow-on investment of up to AU$4 million within 12 months, subject to shareholder approval, market capitalization milestones, and investor consent. Specific market capitalization thresholds were not disclosed.

If activated, this would raise total funding under the Lind relationship to AU$7.5 million from this third agreement alone. However, the follow-on investment is conditional and not guaranteed, depending on shareholder votes and share price performance. Investors should monitor progress over the coming year to assess whether these conditions are met.

Transaction Approvals and Compliance with ASX Listing Rules

The transaction remains subject to conditions including shareholder approvals as required under ASX Listing Rules, particularly where share issuances for repayments or conversions exceed existing placement capacity under Listing Rule 7.1. NMR will need to convene a shareholder meeting to obtain approvals if share-based repayments or conversions surpass current limits.

The timing of any shareholder meeting has not been announced. Until approvals are obtained, repayments due must be made in cash, which includes a 4% premium, creating potential cash flow risk if approvals are delayed or denied. Investors should watch for shareholder meeting notices and ASX updates regarding Listing Rule 7.1 capacity.

Implications of the Lind Partnership for NMR’s Capital Structure

The third consecutive convertible note agreement with Lind Global Fund III LP signals this partnership as a key external capital source for Native Mineral Resources. While details of NMR’s total debt profile, including Collins Street and prior Lind facilities, were not fully disclosed, the reference to existing Lind security arrangements suggests cumulative obligations.

Key considerations for investors include total outstanding convertible face value, aggregate dilution potential, and NMR’s capacity to generate sufficient operating cash flow from gold operations to meet cash repayments when share-based options are unavailable. The immediate share price impact of this announcement was unclear at publication. Upcoming milestones include the Collins Street payment by 14 July 2026, any shareholder meetings for approvals, and operational updates on the Blackjack Mill.