For the transition period from | to |
Not applicable
|
|
|
(Translation of Registrant’s name into English)
|
(Jurisdiction of incorporation or organization)
|
Title of each class
|
Trading Symbol(s)
|
Name of each exchange on which registered
|
||
|
|
|
||
|
|
|
Large accelerated filer ☐
|
Accelerated filer ☐
|
|
Emerging growth company
|
U.S. GAAP ☐
|
|
Other ☐
|
Page
|
|
1
|
|
2
|
|
3
|
|
4
|
|
4
|
|
7
|
|
7
|
|
53
|
|
62
|
|
62 |
|
80 |
|
85
|
|
87
|
|
88 |
|
89 |
|
111 |
|
112
|
|
112
|
|
112 | |
112 | |
112 | |
112 | |
113
|
|
113
|
|
113 |
|
166
|
• |
changes in domestic and foreign business, market, financial, political and legal conditions;
|
• |
inability to obtain financing, equity, debt, or convertible debt financings to fund our operations on favorable terms or at all (including where such inability results in additional costs being incurred, and/or additional funding not be
available, under existing financing arrangements);
|
•
|
our failure to meet financial covenants and other key covenants under existing financing arrangements;
|
•
|
our failure to meet operational targets required to be achieved in order to qualify for additional funding under the OIC Financing (defined below);
|
• |
growth in demand for our wheels being lower than expected, or eventuating later than expected (including but not limited to delay in commencement of wheel programs);
|
• |
increase in prices of labor or materials, or adverse movements in foreign exchange;
|
• |
disruption to global supply chains;
|
•
|
disruption to customer business as a result of industrial action by workers involved in automotive supply chains;
|
• |
our relationships with suppliers and technical partners may deteriorate;
|
• |
risks relating to our bespoke equipment and production process to create a highly complex and innovative product;
|
• |
downward pricing pressure from customers;
|
• |
changes in our competitive position or market share;
|
• |
the inability to maintain the listing of the Company’s securities on a U.S. securities exchange;
|
• |
the inability to complete any private placement financing, the amount of any private placement financing or the completion of any private placement financing with terms unfavorable to us;
|
•
|
holders of Preferred Shares (as defined below) gaining certain governance and control rights, in the event of certain triggers under the Company’s Amended and Restated Memorandum and Articles of
Association;
|
• |
obligations and restrictions that restrict our ability to engage in some business activities under the terms of the OIC Financing, which may restrict our ability to do business and take advantage of
certain opportunities;
|
• |
the failure to realize the anticipated benefits of the Business Combination and related transactions;
|
• |
risks related to the rollout of our business strategy and the timing of expected business milestones;
|
• |
the effects of competition on our future business and our ability to grow and manage growth, establish and maintain relationships with customers, and retain management and key employees;
|
• |
risks related to domestic and international political and macroeconomic uncertainty, including the Israel-Hamas and Russia-Ukraine conflicts;
|
• |
the outcome of any legal proceedings that may be instituted against us or any of our respective directors or officers;
|
• |
the impact of any pandemic or other public health crisis, such as the COVID-19 pandemic, and governmental responses;
|
• |
risks related to Carbon Revolution’s industry;
|
• |
changes in laws and regulations; and
|
• |
other risks and uncertainties described in the section of this Report entitled “Risk Factors.”
|
ITEM 1. |
IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS
|
A. |
Directors and Senior Management
|
Name
|
|
Age
|
Position and Class
|
|
Directors
|
||||
Mark Bernhard
|
59
|
Class II Director
|
||
Lucia Cade
|
56
|
Class II Director
|
||
Jacqueline A. Dedo
|
62
|
Class I Director
|
||
Jacob Dingle
|
52
|
Class III Director
|
||
James Douglas
|
56
|
Class III Director
|
||
Burt Jordan
|
56
|
Class II Director
|
||
Robert A. Lutz
|
91
|
Class III Director
|
||
Matti Masanovich
|
51
|
Class I Director
|
||
Dale McKee
|
63
|
Class I Director
|
||
Executive Officers
|
||||
Jacob Dingle
|
52
|
Chief Executive Officer and Director
|
||
Gerard Buckle
|
54
|
Chief Financial Officer
|
||
David French
|
61
|
Vice President Operations
|
||
Ashley Denmead
|
41
|
Chief Technology Officer
|
||
Jesse Kalkman
|
55
|
Director of Sales and Business Development
|
||
David Nock
|
50
|
General Counsel and Company Secretary
|
B. |
Advisers
|
C. |
Auditors
|
ITEM 2. |
OFFER STATISTICS AND EXPECTED TIMETABLE
|
ITEM 3. |
KEY INFORMATION
|
A. |
[Reserved]
|
B. |
Capitalization and Indebtedness
|
As of June 30, 2023
|
Carbon Revolution
(A$ in thousand)
|
Notes
|
Pro
Forma Combined
(A$ in
thousand)
|
||||||||
Cash and cash equivalents
|
19,582
|
1
|
29,757
|
||||||||
Restricted Trust Fund
|
14,677
|
2
|
67,467 | ||||||||
34,259
|
|
97,224
|
|||||||||
Carbon Revolution common stock
|
386,432
|
3 |
436,835
|
||||||||
Share based payment reserves
|
- |
3 |
24,757
|
||||||||
Carbon Revolution reserves
|
7,166
|
3 |
7,166
|
||||||||
Accumulated losses
|
(377,867
|
) |
3 |
(483,568
|
)
|
||||||
Total stockholders’ equity
|
15,731
|
(14,810
|
) |
||||||||
Debt:
|
|||||||||||
Borrowings (current)
|
13,829
|
3 |
13,829
|
||||||||
Borrowings (non-current)
|
70,833
|
3 |
70,833
|
||||||||
OIC preferred shares (unsecured)
|
- |
4
|
42,834
|
||||||||
OIC Reserve Fund Obligation (unsecured) | - | 5 |
52,790 |
||||||||
84,662
|
180,236
|
||||||||||
Total Capitalization and Indebtedness
|
100,393
|
165,476
|
C. |
Reasons for the Offer and Use of Proceeds
|
D. |
Risk Factors
|
• |
there may be a delay in the availability of the Committed Equity Facility (the Committed Equity Facility will not be available until after the Company’s resale registration statement has been declared
effective by the Securities and Exchange Commission (“SEC”)) and there is no guarantee that the Company will satisfy the applicable conditions precedent for closing further tranches of funding under the OIC Financing (discussed below);
|
• |
as the terms of the Committed Equity Facility will require Yorkville Advisors to purchase additional shares under the Committed Equity Facility beyond an overall ownership of 9.99%, the Company may have
access to materially less than the US$60 million headline figure of the Equity Purchase Agreement entered into in connection with the Committed Equity Facility (the “Equity Purchase Agreement”);
|
• |
the Company may not be able to raise further equity funds from sources other than the Committed Equity Facility or the OIC Financing (assuming the Company is able to close further tranches of funding under
the OIC Financing, which is not guaranteed) in the amounts and within the timeframes necessary for the Company to remain solvent and to comply with its liquidity covenants, on satisfactory terms, or at all;
|
• |
customers and suppliers may not agree to provide the support sought from them; and
|
• |
the 12 Month Cash Flow Projections are subject to achievement by the Company of its financial and operational targets.
|
• |
agreed threshold for revenue, assessed monthly on a rolling trailing six month basis with specific agreed targets for each testing period, with the first testing period being the 6 months expiring June 30,
2023;
|
• |
agreed threshold for Adjusted EBITDA, assessed monthly on a rolling trailing six month basis with specific agreed targets for each testing period, with the first testing period being the 6 months expiring
June 30, 2023;
|
• |
maximum capital expenditure (capex) limits, initially assessed on a rolling trailing six months with specific agreed maximum capex for each testing period with the first testing period being the 6 months
expiring June 30, 2023, and moving to a rolling trailing 12 months basis in January 2024; and
|
• |
minimum cash available requirements for each month until the average monthly EBITDA (based on the previous consecutive three months) of the Company becomes positive, following which the measure will be
based on a current amount.
|
• |
failure to make a payment due under the agreement by the due date;
|
• |
existence of circumstances which could result in a material adverse effect;
|
• |
a change in control of the Carbon Revolution Group, which would include the departure of our Chief Technology Officer, Ashley Denmead, if a reasonably acceptable replacement has not been appointed within 90 days or 120 days;
|
• |
events of insolvency, judgment debt, asset seizure and impairment of security;
|
• |
material misrepresentation; and
|
• |
if any portion of the guaranty ceases to be in full force and effect.
|
• |
manual labor hours required to produce wheels being higher than anticipated, higher materials or supply chain costs than anticipated, wheel programs may experience delays in development or production, or
wheel production volume increases may not be as expected or may not materialize;
|
• |
the Company may not be able to achieve its manufacturing quality, volume and cost targets (including targets relating to reduction in labor cost per wheel and materials cost per wheel);
|
• |
the Company may not be able to increase its capacity to service customer demand or the cost to increase capacity may be more than expected, or it may otherwise be unable to execute its industrialization
plans, including the Mega-line project, as planned;
|
• |
the Company may be exposed to volatility in demand, resulting in disruption to the Company’s operations and supply chain and increased costs;
|
• |
the Company may be manufacturing lower volumes than expected when production for the relevant wheel commences which would result in the benefits of scale being lower than expected, and the costs per wheel
being higher than expected;
|
• |
the Company may not have the flexibility to adjust its raw material supply orders on short notice based on the fluctuations in its customer’s orders, which may adversely affect the Company’s profitability,
cash flow and operations; or
|
• |
the Company’s equipment not performing to the level expected, or product quality not being to the level expected.
|
• |
geopolitical and economic instability in and impacting the localities where we have foreign operations;
|
• |
rising inflation impacting the stability of our workforce and foreign operations;
|
• |
military conflicts impacting the localities where we have foreign operations;
|
• |
limited protection for, and vulnerability to unauthorized access to, reproduction, dissemination or theft of, our intellectual property rights, including our trade secrets;
|
• |
compliance with local laws and regulations, and unanticipated changes in local laws and regulations, including tax laws and regulations;
|
• |
trade and foreign exchange restrictions and higher tariffs;
|
• |
the complexity of managing international trade sanctions and export restrictions from the jurisdictions in which we have foreign operations;
|
• |
fluctuations in foreign currency exchange rates which may increase our expenses for employee compensation and other operating expenses that are paid in currencies other than U.S. dollars;
|
• |
restrictions imposed by the United States government against other countries, or foreign governments’ restrictions imposed on the United States, impacting our ability to do business with certain companies or in certain countries and the
complexity of complying with those restrictions;
|
• |
power outages, natural disasters, and other local events that could affect the availability of the internet and the consequences of disruptions, such as large-scale outages or interruptions of service from utilities or telecommunications
providers;
|
• |
difficulties in staffing international operations;
|
• |
changes in immigration policies which may impact our ability to hire personnel;
|
• |
differing employment practices, laws, and labor relations;
|
• |
regional health issues and the impact of public health epidemics and pandemics on employees and the global economy, such as the COVID-19 pandemic; and
|
• |
disruptions posed by the COVID-19 pandemic and related government restrictions or other government responses.
|
• |
Lack of appropriately designed, implemented and documented procedures and controls at both entity- and process-level to allow for the Company to achieve complete, accurate and timely financial reporting. This
is pervasive across the entity-level and each of the key business processes, including controls over the preparation and review of account reconciliations and journal entries, and controls over information technology to ensure access to
financial data is adequately restricted to appropriate personnel.
|
• |
Segregation of duties has not been sufficiently established across the key business and financial processes. Given the size, nature of the organization and the current structure of the finance function, a
lack of segregation of duties applied to the key business and financial processes across the organization has been identified. A consequence of the lack of segregation of duties is the heightened risk of fraud or material misstatement when
no appropriate mitigating controls are in place.
|
• |
Lack of personnel with appropriate knowledge and experience relating to SEC reporting requirements to enable the entity to design and maintain an effective financial reporting process. A lack of knowledge and experience in these areas
may lead to the Company being in breach of SEC financial reporting and other related requirements, especially given that the current finance function has not been designed to include sufficient accounting and financial reporting personnel
with the requisite knowledge and experience in the application of SEC financial reporting rules and regulations.
|
• |
require that the Company Board be classified into three classes of directors with staggered three-year terms;
|
• |
permit the Company Board to fill any vacancies; and
|
• |
prohibit shareholder action by written consent without unanimous approval of all holders of the Ordinary Shares.
|
• |
the timing of our entry into contracts with customers;
|
• |
our competitors’ products;
|
• |
manufacturing or other issues with respect to our products;
|
• |
our inability to adequately protect our proprietary rights, including patents, trademarks and trade secrets;
|
• |
our inability to raise additional capital and the terms on which we raise it;
|
• |
regulatory developments, including actions with respect to our products or our competitors’ products;
|
• |
actual or anticipated fluctuations in our financial condition and operating results;
|
• |
publication of research reports by securities analysts about us or our competitors or our industry;
|
• |
our failure or the failure of our competitors to meet analysts’ projections or guidance that we or our competitors may give to the market;
|
• |
additions and departures of key personnel;
|
• |
strategic decisions by us or our competitors, such as acquisitions, divestitures, spin-offs, joint ventures, strategic investments or changes in business strategy;
|
• |
sales of our securities by us, our insiders or our other shareholders;
|
• |
speculation in the press or investment community;
|
• |
announcement or expectation of additional financing efforts;
|
• |
changes in market conditions for the stock of companies in our industry; and
|
• |
changes in general market and economic conditions.
|
ITEM 4. |
INFORMATION ON THE COMPANY
|
A. |
History and Development of the Company
|
B. |
Business Overview
|
• |
Action Composites (“Action”): Action (formerly Thyssenkrupp Carbon Components) has developed carbon fiber wheels for Porsche using a braided rim technology. These wheels are reportedly 20% lighter than
Porsche’s regular aluminum wheels for the vehicle;
|
• |
Blackstone Tek (“BST”): BST produces single piece carbon fiber wheels for the motorcycle and automotive aftermarkets;
|
• |
Bucci Composites (“Bucci”): Bucci has developed a low volume 22-inch single piece carbon fiber wheel for the Bentley Bentayga Mulliner and a 20-inch aftermarket carbon fiber automotive wheel;
|
• |
Duqueine Group (“Duqueine”): Duqueine has developed a single piece carbon fiber wheel for the Alpine A110R;
|
• |
Dymag Group Limited (“Dymag”): Dymag sells carbon fiber motorcycle wheels and two piece carbon fiber wheels for the automotive aftermarket and niche vehicle manufacturers, and has recently developed a
prototype 21-inch carbon fiber hybrid wheel in collaboration with Hankuk Carbon and Hyundai;
|
• |
Lacks Enterprises (“Lacks”): Lacks has developed a two-piece wheel with a carbon fiber rim and a forged aluminum face, including for the Dodge Challenger SRT Demon 170;
|
• |
ESE Carbon (“ESE”): ESE has developed a single piece carbon fiber wheel and has a focus on the aftermarket; and
|
• |
Mubea Carbo Tech (“Carbo Tech”): Carbo Tech has developed carbon fiber wheels for BMW using a carbon-fiber/aluminum hybrid wheel, with an aluminum hub and spokes and a carbon-fiber rim. The hybrid
wheel option for the vehicle such wheels are made for appears to be approximately equivalent in weight to the forged aluminum wheel option that is also offered for the vehicle. In addition, Carbo Tech’s website refers to a Carbo Tech single
piece carbon fiber wheel consisting or a carbon fiber composite “rim bed and rim spider”.
|
C. |
Organizational Structure
|
Name
|
Principal Activities
|
Country of
Incorporation
|
Equity Interest held by Carbon
Revolution
|
||||
Carbon Revolution Operations Pty Ltd
|
Carbon fiber wheels
|
Australia
|
100%
|
||||
Carbon Revolution Technology Pty Ltd
|
Carbon fiber wheels
|
Australia
|
100%
|
||||
Carbon Revolution (USA) LLC
|
Carbon fiber wheels
|
United States
|
100%
|
||||
Carbon Revolution (UK) Limited
|
Carbon fiber wheels |
United Kingdom
|
100% |
D. |
Property, Plants and Equipment
|
ITEM 4A. |
UNRESOLVED STAFF COMMENTS
|
ITEM 5. |
OPERATING AND FINANCIAL REVIEW AND PROSPECTS
|
A. |
Operating Results
|
|
Stage of Awarded Program Lifecycle (1)
|
|
|
Programs
|
|
|||||||||
|
Awarded programs in production
|
|
|
6
|
|
|
Ferrari SF90 Stradale
Ferrari 812 Competizione
Ferrari 296 GTB
GM Corvette Z06/Z07/E-Ray JLR Range Rover Sport SV
Ford Mustang Dark Horse
|
|
||||||
|
Awarded Programs
in
development
|
|
|
Electric Vehicles
|
|
|
2
|
|
|
2 SUV / Pickup
|
|
|||
|
Premium ICE Vehicles
|
|
|
5
|
|
|
5 Performance vehicles
|
|
||||||
|
Total Active Awarded Programs
|
|
|
|
|
13
|
|
|
|
|||||
|
Programs in Aftersales
|
|
|
|
|
5
|
|
|
Ford Mustang GT350R
Ford GT500
Ford GT
Ferrari 488 Pista / F8 Tributo
Renault Sport Megane Trophy R
|
|
$ 2023
US ’000
|
$ 2023
AU ’000
|
$ 2022
AU ’000
|
$ 2021
AU ’000
|
|||||||||||||
Sale of wheels
|
24,806
|
37,477
|
38,276
|
32,205
|
||||||||||||
Engineering services
|
351
|
530
|
464
|
2,732
|
||||||||||||
Sale of tooling
|
167
|
253
|
1,596
|
—
|
||||||||||||
Revenue
|
25,324
|
38,260
|
40,336
|
34,937
|
||||||||||||
Cost of goods sold
|
(36,467
|
)
|
(55,094
|
)
|
(57,445
|
) |
(49,232
|
)
|
||||||||
Gross loss
|
(11,143
|
)
|
(16,834
|
)
|
(17,109
|
) |
(14,295
|
)
|
||||||||
Other income
|
2,049
|
3,096
|
4,320
|
10,506
|
||||||||||||
Operational expenses
|
(1,984
|
)
|
(2,997
|
)
|
(2,013
|
) |
(3,366
|
)
|
||||||||
Research and development
|
(10,710
|
)
|
(16,180
|
)
|
(16,933
|
) |
(10,513
|
)
|
||||||||
Administrative expenses
|
(9,641
|
)
|
(14,566
|
)
|
(13,146
|
) |
(15,690
|
)
|
||||||||
Marketing expenses
|
(989
|
)
|
(1,494
|
)
|
(1,550
|
) |
(938
|
)
|
||||||||
Capital raising transaction costs
|
(16,379
|
) |
(24,746
|
) |
—
|
—
|
||||||||||
Finance costs
|
(3,642
|
)
|
(5,502
|
) |
(1,390
|
) |
(1,704
|
)
|
||||||||
Loss before income tax expense
|
(52,439
|
)
|
(79,223
|
)
|
(47,821
|
) |
(36,000
|
)
|
||||||||
Income tax expense
|
—
|
—
|
—
|
—
|
||||||||||||
Loss for the year after income tax
|
(52,439
|
)
|
(79,223
|
)
|
(47,821
|
) |
(36,000
|
)
|
B. |
Liquidity and Capital Resources
|
Cash flow
|
2023
AUD $m
|
2022
AUD $m
|
Change
AUD $m
|
|||||||||
Net cash used in operating activities
|
(52.5
|
)
|
(46.0
|
)
|
(6.5
|
)
|
||||||
Capital Expenditure
|
(13.1
|
)
|
(15.6
|
)
|
2.6
|
|||||||
Intangible Expenditure
|
(4.9
|
)
|
(6.0
|
)
|
1.2
|
|||||||
Net cash used in investing activities
|
(18.0
|
)
|
(21.6
|
)
|
3.6
|
|||||||
Net cash from financing activities
|
66.5
|
3.3
|
63.2
|
|||||||||
Net cash outflow
|
(4.0
|
)
|
(64.3
|
)
|
60.2
|
|
FY23
$m
|
FY22
$m
|
Change
$m
|
|||||||||
Loans and borrowings
|
||||||||||||
Current
|
13.9
|
18.7
|
(4.8
|
)
|
||||||||
Non-current
|
70.8
|
4.3
|
66.5
|
|||||||||
Total loans and borrowings
|
84.7
|
23.0
|
61.7
|
|||||||||
Less: Cash and cash equivalents
|
(19.6
|
)
|
(22.7
|
)
|
3.1
|
|||||||
Less: Restricted trust fund
|
(14.7
|
)
|
-
|
(14.7
|
)
|
|||||||
Adjusted debt
|
50.4
|
0.3
|
50.1
|
Borrowings
|
FY23
A$m
|
FY22
A$m
|
Change
A$m
|
|||||||||
Current
|
13.9
|
18.7
|
(4.8
|
) | ||||||||
Non-current
|
70.8
|
4.3
|
66.5
|
|||||||||
Total Debt
|
84.7
|
23.0
|
61.7
|
|||||||||
(Less) Cash and cash equivalents
|
(19.6
|
) |
(22.7
|
) |
3.1
|
|||||||
(Less) Restricted trust fund
|
(14.7
|
) |
-
|
(14.7
|
) |
|||||||
Adjusted debt
|
50.4
|
0.3
|
50.1
|
• |
Expansion of the production capacity of the Mega-line through both efficiency gains and the introduction of new production assets;
|
•
|
Capturing demand for carbon fiber wheels from current programs, including the Corvette Z06/Z07/E-Ray program;
|
•
|
Successful launches and ramp up of production of new programs including the wheels for the JLR Range Rover Sport SV and Ford Mustang Dark Horse and a number of yet to be named programs;
|
•
|
Development activities for contracted programs and further awards of new programs;
|
•
|
Working collaboratively with existing and new customers to apply its technology to the emerging generation of electric vehicles;
|
•
|
Delivering production cost improvements relating to labor and material costs with the objective of materially improving contribution margin;
|
•
|
Raising sufficient funds to support the growth of the company;
|
•
|
Reducing cash burn by minimizing operating and capital expenditure; and
|
•
|
Introducing the business to the US investment community via investor meetings and investor conferences.
|
• |
US$13.1 million (A$19.7 million) was deducted from the proceeds on account of costs (comprising approximately US$8.8 million (A$13.1 million) for the premium on the insurance for the program plus various
other fees and transactional costs relating to the New Debt Program); and
|
• |
US$9.9 million (A$14.9 million) was used to repay the amounts owed by Carbon Revolution to previous key lenders (including Export Finance Australia and Timelio).
|
• |
US$15.5 million (A$23.2 million) was deposited into certain reserve funds of which US$5.8 million (A$8.6 million) has been released after certain insurance conditions were met. US$5 million (A$7.5 million) is
scheduled to be released after 6 months if not required for covenant cures in that period, US$0.3 million (A$0.5 million) will be used for initial interest payments and the balance of US$4.4 million (A$6.6 million) is held as a payment
reserve; and
|
• |
US$7.3 million (A$10.9 million) was used to pay creditors who assisted Carbon Revolution with its liquidity initiatives.
|
•
|
agreed thresholds for revenue, assessed monthly on a rolling trailing six month basis with specific agreed targets for each testing period, with the first testing period being the 6 months expiring June 30,
2023;
|
•
|
agreed thresholds for EBITDA, assessed monthly on a rolling trailing six month basis with specific agreed targets for each testing period, with the first testing period being the 6 months expiring June 30,
2023;
|
•
|
maximum capital expenditure (capex) limits, assessed monthly and initially assessed on a rolling trailing six month basis with specific agreed maximum capex for each testing period with the first testing
period being the 6 months expiring June 30, 2023, and moving to a rolling trailing 12 month basis in January 2024; and
|
•
|
minimum cash available requirements for each month until the average monthly EBITDA (based on the previous consecutive three months) of the Company becomes positive, following which the measure will be based
on a current amount.
|
• |
failure to make a payment due under the agreement by the due date;
|
• |
existence of circumstances which could result in a material adverse effect;
|
• |
a change in control of the Carbon Revolution Group (prior to the Business Combination);
|
• |
events of insolvency, judgment debt, asset seizure and impairment of security;
|
• |
material misrepresentation; and
|
• |
if any portion of the guaranty ceases to be in full force and effect.
|
• |
Subject to and on the satisfaction of further conditions (see below), the Company will issue US$5 million of Preferred Shares to OIC and receive US$5 million in funding from the Reserve Funds if, prior to the Second Reserve Release (as
defined below), the Company receives aggregate gross proceeds of at least US$10 million from one or more issuances and sales of the Ordinary Shares to one or more third party persons (other than OIC and its affiliates) (“First Reserve
Release”).
|
• |
Subject to and on the satisfaction of further conditions, by December 1, 2024, or if the Company continues to work in good faith to satisfy the relevant condition, January 31, 2025, the Company will issue Preferred Shares to OIC equal in
amount to the remaining Reserve Funds (US$30 million) plus accrued interest and receive the remaining Reserve Funds (“Second Reserve Release”).
|
• |
In the 24 months following the Initial Closing, the Company will, to the extent additional financing is necessary for the development, construction and/or tooling associated with any future manufacturing facility or for material upgrades
to Carbon Revolution’s existing Mega-line plant operations in Australia (“Plant Investments”), have the right, subject to meeting certain conditions described below, to request that OIC subscribe for up to US$40 million of further Preferred
Shares less a 2% subsequent structuring premium (“Subsequent Financing”). Completion of any such Subsequent Financing is subject to approval by OIC’s investment committee.
|
• |
has a term of up to five years from the Initial Closing and may be redeemed earlier at the election of the Company;
|
• |
is entitled to a fixed rate of dividend of 12% per annum, which accrues daily and is payable quarterly in cash or in kind by the issue of additional Preferred Shares at the Company’s election; and
|
• |
is expected to be accounted for as borrowings.
|
• |
12.49%, on and from the Initial Closing; plus
|
• |
5%, following the issue of Preferred Shares to OIC in connection with the Second Reserve Release; plus
|
• |
2.5%, subject to OIC not having failed to fund a Subsequent Financing upon the satisfaction of the relevant conditions by the Company, upon the earlier of:
|
− |
completion of a Subsequent Financing; and
|
− |
24 months after the Initial Closing.
|
a. |
Reserve Funds
|
b. |
Subsequent Financing
|
• |
certain conditions relating to any future manufacturing facility constructed on or after the date of the OIC Purchase Agreement; and
|
• |
OIC’s investment committee approves in its discretion the subscription for the relevant Preferred Shares.
|
• |
Net cash outflows (excluding costs related to the Transaction) from operating activities of approximately $70.5 million, being cash inflows from customers (and grants), less
operating costs, research and development costs, working capital needs, principal repayments, and capital expenditure;
|
• |
Net cash inflows from financing activities of $33 million, consisting primarily of raising new funding or accessing the Committed Equity Facility of $42.3 million and accessing
US$5 million (A$7.8 million) of the funds of the OIC Financing held in escrow upon satisfaction of the First Reserve Release Condition, offset by $14.1 million of Transaction costs indicated to be payable during the remainder of the
projection period, as well as $3.1 million relating to other financing activities;
|
• |
The Group will meet its covenants, as amended on September 18, 2023, under the New Debt Program except for the Adjusted EBITDA test where management forecasts breaches in
February 2024 and August 2024. If it does not meet a covenant, the Group will seek to utilize the cure rights available to it in accordance with the New Debt Agreement. Refer to Note 6.7, Subsequent Events to the financial statements located elsewhere in this Report. The covenants of
the New Debt Program include the following:
|
• |
Minimum Liquidity: From June 30, 2023 and for each month thereafter that the average monthly adjusted EBITDA (based on the previous consecutive three months) of the Group is less
than zero, the Combined Group (as defined in the New Debt Program) must satisfy a minimum available cash requirement covenant, which requires the total cash available to the Group to be greater than or equal to the minimum available cash
requirement. The minimum available cash requirement is an amount not less than the product of the absolute value of the average monthly adjusted EBITDA for the three months most recently ended on such date multiplied by 6.00 for the
fiscal months ending June 30, 2023 to November 30, 2023 (originally June 30, 2023 to October 31, 2023) and 9.00 for the fiscal month ending December 31, 2023 (originally November 30, 2023) and on the last day of each month thereafter.
|
• |
The Co-Obligors (as defined in the PDSA) on a consolidated basis shall have revenue (determined in accordance with IFRS) for the period of the six consecutive fiscal months
ending on the last day of each fiscal month set forth in the New Debt Program (each, a “Test Period”) (but excluding the Test Period ending September 30, 2023 (originally no such exclusion)) of not less than the amount set forth opposite
such month under the column “Minimum Trailing Sixth Month Revenue”, as reflected in the applicable Compliance Certificate (as defined in the New Debt Program) (together with calculations evidencing the same).
|
• |
The Co-Obligors on a consolidated basis shall have Adjusted EBITDA for each Test Period (but excluding the Test Period ending September 30, 2023 (originally no such exclusion)),
of not less than the amount set forth under the column “Minimum Trailing Sixth Month Adjusted EBITDA” opposite such period in the New Debt Program, as reflected in the applicable Compliance Certificate (together with calculations
evidencing the same).
|
• |
Commencing on the Closing Date (as defined in the New Debt Program) until August 31, 2023, and commencing again on November 1, 2023 (originally no such exclusion), the
Co-Obligors shall at all times maintain a reserve in U.S. Dollars in a deposit account at Commonwealth Bank of Australia or such other account bank as may be acceptable to Servicer in an amount of not less than the debt service payments
on the Term Advance (as defined in the New Debt Program) consisting of the sum of (i) the next three (3) months of interest payments, plus (ii) the next three (3) months of principal payments, plus (iii) the next three months (3) of
applicable fees including Loan Monitoring Fees (clauses (i), (ii), and (iii), collectively, the “Debt Service Reserve”).
|
• |
The Company has issued US$35 million ($54.7 million) of Preferred Shares to OIC (“Initial Tranche”) and received US$35 million ($54.7 million) in aggregate gross proceeds, less amounts applied to cover certain transaction costs and an
initial structuring premium payable to an entity associated with OIC of US$1.75 million ($2.7 million) (“Initial Structuring Premium”).
|
• |
US$35 million ($54.7 million) have been deposited into an escrow account controlled by OIC (“Reserve Funds”).
|
• |
Subject to and on the satisfaction of further conditions, the Company will issue US$5 million (A$7.8 million) of Preferred Shares to OIC and receive US$5 million (A$7.8 million) in funding from the Reserve Funds if, prior to the Second
Reserve Release, the Company receives aggregate gross proceeds of at least US$10 million ($15.6 million) from one or more issuances and sales of Ordinary Shares to one or more third party persons (other than OIC and its affiliates) pursuant
to the First Reserve Release. Carbon Revolution projects in its 12 Month Cash Flow Projections that the First Reserve Release will occur by February 2024.
|
• |
Subject to and on the satisfaction of further conditions by December 1, 2024, or if the Company continues to work in good faith to satisfy the relevant condition, January 31, 2025, the Company will issue Preferred Shares to OIC equal in
amount to the remaining Reserve Funds plus accrued interest and receive the remaining Reserve Funds pursuant to the Second Reserve Release. The Second Reserve Release is not included in the 12 Month Cash Flow Projections as management does
not expect the Second Reserve Release to take place within the projection period.
|
• |
In the 24 months following the Initial Closing, the Company will, to the extent additional financing is necessary for Plant Investments, have the right, subject to meeting certain conditions described below, to request a Subsequent
Financing. Completion of any such Subsequent Financing is subject to approval by OIC’s investment committee. The Subsequent Financing is not included in the 12 Month Cash Flow Projections as management does not expect the Subsequent
Financing to take place within the projection period.
|
• |
There are no assurances as to when the closing conditions for the OIC Financing for the Reserve Funds or Subsequent Financing will be satisfied;
|
• |
The Company’s ability to raise further capital is subject to consent from OIC; and
|
• |
The Company Board may not be able to act in the best interests of the Company or the Company shareholders as a result of the terms of the OIC Documents that impose obligations on the Company or restrict the Company’s ability to engage
in some business activities, which could materially adversely affect the Company’s business, results of operations and financial condition.
|
•
|
There is no contractual arrangement with the key customer that requires it to accept the request for the bailment and advance payments;
|
•
|
The customer may not accept the Group’s request for the bailment and advance payments; and
|
•
|
There may be a delay in the customer accepting and making the bailment and advance payments.
|
• |
there may be a delay in the availability of the CEF (the CEF will not be available until after the filing by the Company of its annual report for the year ended June 30, 2023, which has not yet been filed with the SEC, and filing with
the SEC of a registration statement for the resale of Ordinary Shares, and such registration statement being declared effective by the SEC);
|
• |
the Group’s advisors that will be assisting in raising capital through the CEF may be unable to dispose of the shares of the Company on an ongoing basis. As the terms of the CEF will not require the advisor to purchase additional shares
under the CEF beyond an overall ownership of 9.99% (the CEF Ownership Restriction) or US$10 million (A$15.4 million) per week, whichever is lower, the Group may have access to materially less than the US$27.5 million projected to be drawn
under the CEF during the next 12 months;
|
• |
In order for the Company to be able to draw down on the next advance, the CEF provider will be required to sell some or all of its Ordinary Shares issued as part of the first advance on market which, in the absence of significant demand
for the Ordinary Shares, may put significant downward pressure on the trading price. This may cause the 9.99% shareholding cap under the next advance to be reached in conjunction with a lower US$ amount of cash raised under the CEF. This
mechanism may create a downward spiral in the share price of the Company which may prevent CBR from being able to utilize the CEF to create liquidity;
|
• |
When the Company lodges a request to drawdown an amount of equity from the CEF, the CEF Provider is specifically permitted to sell the shares in the Company during the period between lodgement of the request to drawdown and the date the
shares are issued to it so that it may manage its risk should it need to. The agreement for the CEF deems a request to drawdown equity from the CEF to be an unconditional contract that is binding on both parties;
|
• |
The CEF Provider is permitted to sell the shares in the Company for which it is bound to subscribe, before it is issued with them, and before it has paid the subscription price. This might be characterized as short selling of the
Ordinary Shares. Accordingly, there exists the potential for the CEF Provider to place downward pressure on the trading price of the Ordinary Shares on the public market by short selling shares it does not yet own. This effect is more
severe under the CEF than other ordinary short selling arrangements because the CEF Provider will not subsequently re-enter the public market to purchase the shares it has already sold (and by doing so, provide support for the trading
price) but will instead simply deliver, to either the lender of the covered position or the purchaser if the short sale was naked, the shares subscribed for under the CEF when they are issued; and
|
• |
the Group may not be able to raise further equity funds from sources other than the CEF in the amounts and within the timeframes necessary for the Group to remain solvent and to comply with its liquidity covenants, on satisfactory terms,
or at all.
|
• |
The Group reached agreement with certain suppliers to defer total payments of $8.9 million including future invoices during the deferral period. Under the terms of these agreements, the deferred payments are required to be made in
November 2023.
|
• |
The Group reached agreement with certain of its advisers relating to the deferral of $23.7 million of fees owed to them at the closing of the Business Combination, with $10.6 million of these fees projected to be payable during the
next 12 month period.
|
• |
In connection with the OIC Financing, the Group obtained certain amendments to terms of the New Debt Program. Refer to Note 6.7 Subsequent Events to the financial statements included elsewhere in this Report.
|
|
2023
$’000
|
2022
$’000
|
||||||
Right-of-use assets
|
||||||||
Property
|
7,446
|
7,564
|
||||||
Lease liabilities
|
||||||||
Current
|
645
|
579
|
||||||
Non-current
|
7,368
|
7,461
|
||||||
|
8,013
|
8,040
|
Interest rate
%
|
Maturity
|
2023
$’000
|
2022
$’000
|
||||||||||
Current borrowings
|
|||||||||||||
Secured
|
|||||||||||||
Working capital facility
|
7.44%
|
|
May 2023
|
-
|
6,843
|
||||||||
Term loan
|
6.15%
|
|
May 2023
|
-
|
2,889
|
||||||||
Letter of credit facility
|
|
6.45%
|
|
May 2023
|
-
|
4,000
|
|||||||
-
|
13,732
|
||||||||||||
Unsecured
|
|||||||||||||
Term loan with customer
|
10%
|
June 2024
|
4,523
|
-
|
|||||||||
Supplier finance arrangement
|
6.00% +
RBA cash rate
|
-
|
9,306
|
4,954
|
|||||||||
13,829
|
18,686
|
||||||||||||
Non-current borrowings
|
|||||||||||||
Secured
|
|||||||||||||
Term loan
|
6.15%
|
|
December 2024
|
-
|
4,333
|
||||||||
Term loan (USD)
|
8.50%
|
May 2027
|
70,833
|
||||||||||
70,833
|
4,333
|
C. |
Research and development, patents and licenses, etc.
|
D. |
Trend Information
|
E. |
Critical Accounting Policies and Estimates
|
− |
Post-tax discount rate: 11.5%. The incremental borrowing rate used for the post-tax discount rate does not consider any element of default risk associated with Carbon Revolution, which is not relevant in assessing the return expected
from the assets.
|
− |
Terminal value growth rate beyond 5 years: 2.7%
|
− |
Compound annual growth rate wheel volume: 14.8%
|
− |
Direct Material costs reduce from $1,306 per wheel in FY23 to $832 in the terminal year
|
− |
Direct Labor costs reduce from $1,324 per wheel in FY23 to $589 in the terminal year
|
ITEM 6. |
DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES
|
A. |
Directors and Senior Management
|
B. |
Compensation
|
|
|
|
A$
Year
end
|
|
|
Short-term employee benefit
|
|
|
Post-
employment
benefits
|
|
|
Share-based payment
|
|
|||||||||||||
|
|
|
June 30
|
|
|
Cash
|
|
|
Other
Benefits
|
|
|
Leave
Benefits
|
|
|
Super-
annuation
|
|
|
STI
expense(1)
|
|
|
LTI
expense(2)
|
|
|
One-off
equity
award(3)
|
|
|
|
Managing director – Jacob Dingle
|
|
||||||||||||||||||||||||
|
|
|
2023
|
|
|
572,852
|
|
|
—
|
|
|
7,206
|
|
|
27,500
|
|
|
206,484
|
|
|
267,106
|
|
|
—
|
|
|
|
Chief financial officer – Gerard Buckle
|
|
||||||||||||||||||||||||
|
|
|
2023
|
|
|
393,758
|
|
|
—
|
|
|
22,681
|
|
|
25,293
|
|
|
145,518
|
|
|
114,011
|
|
|
9,633
|
|
(1) |
STI expense for FY23 plus amortization of STI relating to prior years grants.
|
(2) |
Employee Stock Ownership Plan and FY21& FY22 LTI grants are expensed over the vesting period at a valuation determined on grant date by a third party detailed below under “—Number of LTI Awards”.
|
(3) |
Total expense of the one-off equity grant made to Mr. Buckle on November 29, 2019 as a sign on award to replace a portion of an incentive from his previous employer which he forfeited on joining Carbon Revolution. The face value of these
shares was A$262,501 and they vested on September 9, 2022.
|
• |
for the initial equity grant only (in respect of the 12 months from closing), Mr. James Douglas as Chair of Company will be awarded US$250,000 of Company restricted stock units (“RSUs”) and the other NEDs
will be awarded $200,000 of Company RSUs, which will vest three months from the Closing Date. Such grants will be made under the 2023 Stock Option and Incentive Plan; and
|
• |
for each subsequent annual grant, the Chair of Company will be awarded US$150,000 of Company RSUs and the other NEDs will be awarded US$120,000, which vest in four equal tranches at the end of each quarter in
the 12 months from the grant date, subject to the service condition being met.
|
• |
A cash retainer schedule as follows:
|
• |
Chair base fee: US$60,000 cash
|
• |
NED base fee: US$30,000 cash
|
• |
Audit and Risk Committee Chair fee: additional US$20,000 cash
|
• |
Audit and Risk Committee Member fee: additional US$10,000 cash
|
• |
Remuneration and Nomination Committee Chair fee: additional US$15,000 cash
|
• |
Remuneration and Nomination Committee Member fee: additional US$7,500 cash
|
Role
|
Annual fee for FY23
(including super guarantee)
(in A$)
|
||
Chair – Carbon Revolution Board (base fees)
|
$180,000
|
||
Other NED (base fees)
|
$90,000
|
||
Chair of the Audit and Risk Committee
|
An additional $10,000
|
||
Chair of the Remuneration and Nomination Committee
|
An additional $10,000
|
||
Committee memberships
|
An additional $5,000 per committee
|
Year ended June 30, 2023
|
Directors’
fees
A$
|
Directors’
Fees
Allocated in
Rights
$
|
Superannuation
A$
|
Total
A$
|
|||||||||||||||
James Douglas (Chair)
|
|
|
FY23
|
171,946
|
—
|
18,054
|
190,000
|
||||||||||||
Lucia Cade
|
|
|
FY23
|
90,498
|
—
|
9,502
|
100,000
|
||||||||||||
Dale McKee
|
|
|
FY23
|
90,498
|
—
|
9,502
|
100,000
|
||||||||||||
Mark Bernhard
|
|
|
FY23
|
90,498
|
—
|
9,502
|
100,000
|
Name of
Beneficiary |
Title of
Options |
Amount of
Securities
Covered
|
Exercise
Price
|
Purchase
Price (if any)
|
Expiration
Date
|
|||||||||||
Jacob Dingle
|
FY22 Options
|
1,210,826
|
$
|
1.60
|
-
|
September 20, 2026
|
||||||||||
|
FY21 Rights
|
186,381
|
-
|
-
|
September 20, 2023
|
|||||||||||
FY20 ESOP Options
|
1,273,419
|
$
|
2.60
|
-
|
November 29, 2024
|
|||||||||||
Gerard Buckle
|
FY22 Options
|
678,062
|
$
|
1.60
|
-
|
September 20, 2026
|
||||||||||
FY21 Rights
|
104,373
|
-
|
-
|
September 20, 2023
|
||||||||||||
FY20 ESOP Options
|
356,557
|
$
|
2.60
|
-
|
November 29, 2024
|
C. |
Board Practices
|
D. |
Employees
|
E. |
Share Ownership
|
F. |
Disclosure of a registrant’s action to recover erroneously awarded compensation.
|
ITEM 7. |
MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS
|
A. |
Major Shareholders
|
• |
each person, or group of affiliated persons, known by us to beneficially own more than 5% of outstanding Ordinary Shares;
|
• |
each of our directors;
|
• |
each of our directors and executive officers; and
|
• |
all of our directors and executive officers as a group.
|
Beneficial Owner
|
Number
of
Ordinary Shares
|
Percentage
of
All Ordinary Shares
|
||||||
Executive Officers, Directors and Director Nominees
|
||||||||
Mark Bernhard
|
1,650 |
|
*
|
|||||
Lucia Cade(1)
|
2,242 |
|
*
|
|||||
Jacqueline A. Dedo
|
--
|
- | ||||||
Jacob Dingle(2)
|
30,151
|
|
1.6 |
%
|
||||
James Douglas
|
11,897 |
|
*
|
|||||
Burt Jordan
|
--
|
--
|
||||||
Robert A. Lutz
|
--
|
--
|
||||||
Matti Masanovich
|
--
|
--
|
||||||
Dale McKee(3)
|
801
|
|
*
|
|||||
Gerard Buckle(4)
|
3,236
|
|
*
|
|||||
David French
|
4,780
|
|
*
|
|
||||
Ashley Denmead
|
15,442
|
|
*
|
|
||||
Jesse Kalkman |
--
|
--
|
||||||
David Nock(5)
|
2,217 |
* | ||||||
All executive officers and directors as a group (14 persons)
|
72,416 | 3.9 |
%
|
|||||
Other 5% Shareholders
|
||||||||
Twin Ridge Capital Sponsor LLC(6)
|
159,000
|
|
8.5 | % | ||||
Daniel Hennessy |
134,000 |
7.1 |
% |
* |
Indicates beneficial ownership of less than 1% of total outstanding Ordinary Shares.
|
(1)
|
2,147 Ordinary Shares are held by Cade & Associates Pty Ltd.
|
(2)
|
24,036 Ordinary Shares are owned by Point Grey Investments Pty Ltd.
|
(3)
|
684 Ordinary Shares are held by McKee Family Investments Pty Ltd.
|
(4)
|
213 Ordinary Shares are held jointly with his wife.
|
(5) |
90 Ordinary Shares are held by his wife.
|
(6)
|
The Sponsor is the beneficial holder of the shares reported herein. The Sponsor is controlled by Sanjay K. Morey and William P. Russell, Jr. Each of Sanjay K. Morey and William P. Russell Jr. disclaims any beneficial ownership of
the securities held by the Sponsor other than to the extent of any pecuniary interest he may have therein, directly or indirectly.
|
B. |
Related Party Transactions
|
C. |
Interests of Experts and Counsel
|
ITEM 8. |
FINANCIAL INFORMATION
|
A. |
Consolidated Statements and Other Financial Information
|
B. |
Significant Changes
|
ITEM 9. |
THE OFFER AND LISTING
|
A. |
Offer and Listing Details
|
B. |
Plan of Distribution
|
C. |
Markets
|
D. |
Selling Shareholders
|
E. |
Dilution
|
F. |
Expenses of the Issuer
|
ITEM 10. |
ADDITIONAL INFORMATION
|
A. |
Share Capital
|
B.
|
Memorandum and Articles of Association
|
•
|
in whole and not in part;
|
•
|
at a price of $0.01 per warrant;
|
•
|
upon not less than 30 days’ prior written notice of redemption to each warrant holder; and
|
•
|
if, and only if, the closing price of the Ordinary Shares equals or exceeds $180.00 per share (as adjusted for adjustments described under – Anti-dilution Adjustments) for any 20 trading days within a 30-trading day period ending
on the third trading day prior to the date on which notice of the redemption is sent to the warrant holders.
|
• |
in whole and not in part;
|
• |
at $1.00 per warrant upon a minimum of 30 days’ prior written notice of redemption provided that holders will be able to exercise their warrants on a cashless basis prior to redemption and receive that number
of shares determined by reference to the table below, based on the redemption date and the “fair market value” (as defined below) of the Ordinary Shares, except as otherwise described below;
|
• |
if, and only if, the closing price of the Ordinary Shares equals or exceeds $100.00 per public share (as adjusted for adjustments described under – Anti-dilution Adjustments) for any 20 trading days within
the 30-trading day period ending three trading days before we send the notice of redemption to the warrant holders; and
|
• |
if the closing price of the Ordinary Shares for any 20 trading days within a 30-trading day period ending on the third trading day prior to the date on which we send the notice of redemption to the warrant
holders is less than $180.00 per share (as adjusted for adjustments described under – Anti-dilution Adjustments), the Founder Warrants must also be concurrently called for redemption on the same terms as the outstanding Public Warrants, as
described above.
|
Redemption Date
(period to expiration of warrants)
|
|
Fair Market Value of Ordinary Shares
|
|||||||||||||||||
≤$100.00
|
|
$110.00
|
|
$120.00
|
|
$130.00
|
|
$140.00
|
|
$150.00
|
|
$160.00
|
|
$170.00
|
|
≥$180.00
|
|||
60 months
|
|
0.261
|
|
0.281
|
|
0.297
|
|
0.311
|
|
0.324
|
|
0.337
|
|
0.348
|
|
0.358
|
|
0.361
|
|
57 months
|
|
0.257
|
|
0.277
|
|
0.294
|
|
0.310
|
|
0.324
|
|
0.337
|
|
0.348
|
|
0.358
|
|
0.361
|
|
54 months
|
|
0.252
|
|
0.272
|
|
0.291
|
|
0.307
|
|
0.322
|
|
0.335
|
|
0.347
|
|
0.357
|
|
0.361
|
|
51 months
|
|
0.246
|
|
0.268
|
|
0.287
|
|
0.304
|
|
0.320
|
|
0.333
|
|
0.346
|
|
0.357
|
|
0.361
|
|
48 months
|
|
0.241
|
|
0.263
|
|
0.283
|
|
0.301
|
|
0.317
|
|
0.332
|
|
0.344
|
|
0.356
|
|
0.361
|
|
45 months
|
|
0.235
|
|
0.258
|
|
0.279
|
|
0.298
|
|
0.315
|
|
0.330
|
|
0.343
|
|
0.356
|
|
0.361
|
|
42 months
|
|
0.228
|
|
0.252
|
|
0.274
|
|
0.294
|
|
0.312
|
|
0.328
|
|
0.342
|
|
0.355
|
|
0.361
|
|
39 months
|
|
0.221
|
|
0.246
|
|
0.269
|
|
0.290
|
|
0.309
|
|
0.325
|
|
0.340
|
|
0.354
|
|
0.361
|
|
36 months
|
|
0.213
|
|
0.239
|
|
0.263
|
|
0.285
|
|
0.305
|
|
0.323
|
|
0.339
|
|
0.353
|
|
0.361
|
|
33 months
|
|
0.205
|
|
0.232
|
|
0.257
|
|
0.280
|
|
0.301
|
|
0.320
|
|
0.337
|
|
0.352
|
|
0.361
|
|
30 months
|
|
0.196
|
|
0.224
|
|
0.250
|
|
0.274
|
|
0.297
|
|
0.316
|
|
0.335
|
|
0.351
|
|
0.361
|
|
27 months
|
|
0.185
|
|
0.214
|
|
0.242
|
|
0.268
|
|
0.291
|
|
0.313
|
|
0.332
|
|
0.350
|
|
0.361
|
|
24 months
|
|
0.173
|
|
0.204
|
|
0.233
|
|
0.260
|
|
0.285
|
|
0.308
|
|
0.329
|
|
0.348
|
|
0.361
|
|
21 months
|
|
0.161
|
|
0.193
|
|
0.223
|
|
0.252
|
|
0.279
|
|
0.304
|
|
0.326
|
|
0.347
|
|
0.361
|
|
18 months
|
|
0.146
|
|
0.179
|
|
0.211
|
|
0.242
|
|
0.271
|
|
0.298
|
|
0.322
|
|
0.345
|
|
0.361
|
|
15 months
|
|
0.130
|
|
0.164
|
|
0.197
|
|
0.230
|
|
0.262
|
|
0.291
|
|
0.317
|
|
0.342
|
|
0.361
|
|
12 months
|
|
0.111
|
|
0.146
|
|
0.181
|
|
0.216
|
|
0.250
|
|
0.282
|
|
0.312
|
|
0.339
|
|
0.361
|
|
9 months
|
|
0.090
|
|
0.125
|
|
0.162
|
|
0.199
|
|
0.237
|
|
0.272
|
|
0.305
|
|
0.336
|
|
0.361
|
|
6 months
|
|
0.065
|
|
0.099
|
|
0.137
|
|
0.178
|
|
0.219
|
|
0.259
|
|
0.296
|
|
0.331
|
|
0.361
|
|
3 months
|
|
0.034
|
|
0.065
|
|
0.104
|
|
0.150
|
|
0.197
|
|
0.243
|
|
0.286
|
|
0.326
|
|
0.361
|
|
0 months
|
|
—
|
|
—
|
|
0.042
|
|
0.115
|
|
0.179
|
|
0.233
|
|
0.281
|
|
0.323
|
|
0.361
|
• |
require that the Company Board be classified into three classes of directors with staggered three-year terms;
|
• |
permit the Company Board to fill any vacancies; and
|
• |
prohibit shareholder action by written consent without unanimous approval of all holders of the Ordinary Shares.
|
C. |
Material Contracts
|
D. |
Exchange Controls and Other Limitations Affecting Security Holders
|
E.
|
Taxation
|
• |
financial institutions;
|
• |
insurance companies;
|
• |
mutual funds;
|
• |
pension plans;
|
• |
S corporations;
|
• |
broker-dealers;
|
• |
traders in securities that elect mark-to-market treatment;
|
• |
regulated investment companies;
|
• |
real estate investment trusts;
|
• |
trusts and estates;
|
• |
tax-exempt organizations (including private foundations);
|
• |
investors that hold our Ordinary Shares or Public Warrants as part of a “straddle”, “hedge”, “conversion”, “synthetic security”, “constructive ownership transaction”, “constructive sale” or other integrated
transaction for U.S. federal income tax purposes;
|
• |
investors subject to the alternative minimum tax provisions of the Code;
|
• |
U.S. Holders that have a functional currency other than the U.S. dollar;
|
• |
U.S. expatriates;
|
• |
U.S. Holders owning or considered as owning (directly, indirectly, or through attribution) 5 percent (measured by vote or value) or more of our Ordinary Shares;
|
• |
persons who received our Ordinary Shares as compensation;
|
• |
accrual method taxpayers that file applicable financial statements as described in Section 451(b); and
|
• |
persons who are not U.S. Holders, all of whom may be subject to tax rules that differ materially from those summarized below.
|
• |
an individual who is a U.S. citizen or resident of the United States;
|
• |
a corporation (including an entity treated as a corporation for U.S. federal income tax purposes) created or organized in or under the laws of the United States, any state thereof or the District of
Columbia;
|
• |
an estate the income of which is includible in gross income for U.S. federal income tax purposes regardless of its source; or
|
• |
a trust (A) the administration of which is subject to the primary supervision of a U.S. court and which has one or more U.S. persons (within the meaning of the Code) who have the authority to control all
substantial decisions of the trust or (B) that has in effect a valid election under applicable Treasury Regulations to be treated as a U.S. person.
|
• |
the U.S. Holder’s gain or excess distribution will be allocated ratably over the U.S. Holder’s relevant holding period for the Ordinary Shares or Public Warrants;
|
• |
the amount allocated to the U.S. Holder’s taxable year in which the U.S. Holder recognized the gain or received the excess distribution, or to the period in the U.S. Holder’s holding period before the first
day of the First PFIC Holding Year, will be taxed as ordinary income;
|
• |
the amount allocated to other taxable years (or portions thereof) of the U.S. Holder and included in its holding period will be taxed at the highest tax rate in effect for that year and applicable to the
U.S. Holder; and
|
• |
an additional tax equal to the interest charge generally applicable to underpayments of tax will be imposed on the U.S. Holder with respect to the tax attributable to each such other taxable year of the
U.S. Holder.
|
• |
there is no change in the beneficial ownership of such shares as a result of the transfer; and
|
• |
the transfer into (or out of) DTC is not effected in contemplation of a sale of such shares or warrants by a beneficial owner to a third party.
|
• |
a person (not being a company) resident for tax purposes in a Relevant Territory (including the United States) and is neither resident nor ordinarily resident in Ireland (for a list of Relevant Territories
for DWT purposes, please see Exhibit 15.3 to this Report;
|
• |
a company resident for tax purposes in a Relevant Territory, provided such company is not under the control, whether directly or indirectly, of a person or persons who is or are resident in Ireland;
|
• |
a company that is controlled, directly or indirectly, by persons resident in a Relevant Territory and who is or are (as the case may be) not controlled by, directly or indirectly, persons who are not
resident in a Relevant Territory;
|
• |
a company whose principal class of shares (or those of its 75% direct or indirect parent) is substantially and regularly traded on a stock exchange in Ireland, on a recognized stock exchange either in a
Relevant Territory or on such other stock exchange approved by the Irish Minister for Finance; or
|
• |
a company that is wholly-owned, directly or indirectly, by two or more companies where the principal class of shares of each of such companies is substantially and regularly traded on a stock exchange in
Ireland, a recognized stock exchange in a Relevant Territory or on such other stock exchange approved by the Irish Minister for Finance,
|
• |
its broker (and the relevant information is further transmitted to any qualifying intermediary appointed by the Company) before the record date for the distribution (or such later date before the
distribution payment date as may be notified to the holder of Ordinary Shares by the broker) if its Ordinary Shares are held through DTC; or
|
• |
the Company’s transfer agent before the record date for the distribution if its Ordinary Shares are held outside of DTC.
|
F.
|
Dividends and Paying Agents
|
G.
|
Statement by Experts
|
H.
|
Documents on Display
|
I.
|
Subsidiary Information
|
+/- 5% exchange rate
|
2023
$’000
|
|
2022
$’000
|
|||||
Impact on profit after tax
|
1,618
|
|
90
|
|||||
Impact on equity
|
(1,618
|
)
|
|
(90
|
)
|
ITEM 12. |
DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES
|
Item 13. |
Defaults, Dividend Arrearages and Delinquencies.
|
Item 14. |
Material Modifications to the Rights of Security Holders and Use of Proceeds.
|
Item 15. |
Controls and Procedures.
|
Item 16. |
[Reserved]
|
Item 16A. |
Audit committee financial expert.
|
Item 16B. |
Code of Ethics.
|
Item 16C. |
Principal Accountant Fees and Services.
|
Item 16D. |
Exemptions from the Listing Standards for Audit Committees.
|
Item 16E |
Purchases of Equity Securities by the Issuer and Affiliated Purchasers.
|
Item 16F. |
Change in Registrant’s Certifying Accountant.
|
Item 16G. |
Corporate Governance.
|
Item 16H. |
Mine Safety Disclosure.
|
Item 16I. |
Disclosure Regarding Foreign Jurisdictions that Prevent Inspections.
|
Item 16J. |
Insider Trading Policies
|
Item 16K.
|
Cybersecurity.
|
ITEM 17. |
FINANCIAL STATEMENTS
|
ITEM 18. |
FINANCIAL STATEMENTS
|
Note
|
|
2023
US $’0005
|
|
|
2023
AU $’000
|
|
2022
AU $’000
|
|
2021
AU $’000
|
|||||||||||
Sale of wheels
|
24,806
|
37,477
|
38,276
|
32,205
|
||||||||||||||||
Engineering services
|
351
|
530
|
464
|
2,732
|
||||||||||||||||
Sale of tooling
|
167
|
253
|
1,596
|
-
|
||||||||||||||||
Revenue
|
2.1
|
25,324
|
38,260
|
40,336
|
34,937
|
|||||||||||||||
Cost of goods sold
|
3.2.1
|
(36,467
|
)
|
(55,094
|
)
|
(57,445
|
)
|
(49,232
|
)
|
|||||||||||
Gross loss
|
(11,143
|
)
|
(16,834
|
)
|
(17,109
|
)
|
(14,295
|
)
|
||||||||||||
Other income
|
2.2
|
2,049
|
3,096
|
4,320
|
10,506
|
|||||||||||||||
Operational expenses
|
(1,984
|
)
|
(2,997
|
)
|
(2,013
|
)
|
(3,366
|
)
|
||||||||||||
Research and development expenses
|
2.4
|
(10,710
|
)
|
(16,180
|
)
|
(16,933
|
)
|
(10,513
|
)
|
|||||||||||
Administrative expenses
|
(9,641
|
)
|
(14,566
|
)
|
(13,146
|
)
|
(15,690
|
)
|
||||||||||||
Marketing expenses
|
(989
|
)
|
(1,494
|
)
|
(1,550
|
)
|
(938
|
)
|
||||||||||||
Capital raising transaction costs
|
4.7
|
(16,379
|
)
|
(24,746
|
)
|
-
|
-
|
|||||||||||||
Finance costs
|
2.4
|
(3,642
|
)
|
(5,502
|
)
|
(1,390
|
)
|
(1,704
|
)
|
|||||||||||
Loss before income tax expense
|
(52,439
|
)
|
(79,223
|
)
|
(47,821
|
)
|
(36,000
|
)
|
||||||||||||
Income tax expense
|
5
|
-
|
-
|
-
|
-
|
|||||||||||||||
Loss for the year after income tax
|
(52,439
|
)
|
(79,223
|
)
|
(47,821
|
)
|
(36,000
|
)
|
||||||||||||
Other comprehensive loss
|
||||||||||||||||||||
Items that may be reclassified subsequently to profit or loss:
|
||||||||||||||||||||
Foreign currency translation differences – foreign operations
|
(41
|
)
|
(62
|
)
|
(147
|
)
|
150
|
|||||||||||||
Other comprehensive loss
|
(41
|
)
|
(62
|
)
|
(147
|
)
|
150
|
|||||||||||||
Total comprehensive loss for the year, net of tax
|
(52,480
|
)
|
(79,285
|
)
|
(47,968
|
)
|
(35,850
|
)
|
||||||||||||
Earnings per share
|
||||||||||||||||||||
Basic
|
2.5
|
$
|
(0.25
|
)
|
$
|
(0.38
|
)
|
$
|
(0.23
|
)
|
$
|
(0.23
|
)
|
|||||||
Diluted
|
2.5
|
$
|
(0.25
|
)
|
$
|
(0.38
|
)
|
$
|
(0.23
|
)
|
$
|
(0.23
|
)
|
Note
|
June 30,
2023
US $’0007
|
June 30,
2023 AU $’000
|
June 30,
2022
AU $’000
|
|||||||||||||
Current assets
|
||||||||||||||||
Cash and cash equivalents
|
4.1
|
12,961
|
19,582
|
22,693
|
||||||||||||
Restricted trust fund
|
4.1
|
9,715
|
14,677
|
-
|
||||||||||||
Receivables
|
3.1
|
4,256
|
6,430
|
14,483
|
||||||||||||
Contract assets
|
2.1
|
5,453
|
8,239
|
5,909
|
||||||||||||
Inventories
|
3.2
|
14,676
|
22,173
|
20,164
|
||||||||||||
Other current assets
|
249
|
378
|
1,587
|
|||||||||||||
Total current assets
|
47,310
|
71,479
|
64,836
|
|||||||||||||
Non-current assets
|
||||||||||||||||
Property, plant and equipment
|
3.3
|
41,460
|
62,638
|
57,616
|
||||||||||||
Right-of-use assets
|
3.4
|
4,929
|
7,446
|
7,564
|
||||||||||||
Intangible assets
|
3.5
|
11,103
|
16,774
|
14,364
|
||||||||||||
Total non-current assets
|
57,492
|
86,858
|
79,544
|
|||||||||||||
Total assets
|
104,802
|
158,337
|
144,380
|
|||||||||||||
Current liabilities
|
||||||||||||||||
Payables
|
3.6
|
10,242
|
15,474
|
9,502
|
||||||||||||
Borrowings
|
4.2
|
9,153
|
13,829
|
18,686
|
||||||||||||
Lease liability
|
3.4
|
427
|
645
|
579
|
||||||||||||
Contract liability
|
2.1
|
495
|
748
|
458
|
||||||||||||
Deferred income
|
3.7
|
1,270
|
1,919
|
1,028
|
||||||||||||
Provisions
|
3.8
|
8,576
|
12,957
|
4,161
|
||||||||||||
Total current liabilities
|
30,163
|
45,572
|
34,414
|
|||||||||||||
Non-current liabilities
|
||||||||||||||||
Borrowings
|
4.2
|
46,884
|
70,833
|
4,333
|
||||||||||||
Lease liability
|
3.4
|
4,877
|
7,368
|
7,461
|
||||||||||||
Contract liability
|
2.1
|
1,162
|
1,755
|
323
|
||||||||||||
Deferred income
|
3.7
|
10,084
|
15,235
|
5,211
|
||||||||||||
Provisions
|
3.8
|
1,220
|
1,843
|
713
|
||||||||||||
Total non-current liabilities
|
64,227
|
97,034
|
18,041
|
|||||||||||||
Total liabilities
|
94,390
|
142,606
|
52,455
|
|||||||||||||
Net assets
|
10,412
|
15,731
|
91,925
|
|||||||||||||
Equity
|
||||||||||||||||
Contributed equity
|
4.4
|
255,779
|
386,432
|
383,822
|
||||||||||||
Reserves
|
4.6
|
4,743
|
7,166
|
6,747
|
||||||||||||
Accumulated losses
|
(250,110
|
)
|
(377,867
|
)
|
(298,644
|
)
|
||||||||||
Total equity
|
10,412
|
15,731
|
91,925
|
|
Note |
Contributed equity
|
Share
buyback reserve
|
Share
based
payment reserve |
Accumulated losses
|
Foreign currency translation reserve
|
Total
equity
|
||||||||||||||||||
AU $’000
|
AU $’000
|
AU $’000
|
AU $’000
|
AU $’000
|
AU $’000
|
||||||||||||||||||||
Balance as of June 30, 2020
|
291,226
|
(311
|
)
|
1,394
|
(214,823
|
)
|
(159
|
)
|
77,327
|
||||||||||||||||
Net loss after tax for the full year
|
-
|
-
|
-
|
(36,000
|
)
|
-
|
(36,000
|
)
|
|||||||||||||||||
Other comprehensive loss for the full year
|
-
|
-
|
-
|
0
|
150
|
150
|
|||||||||||||||||||
Total comprehensive loss for the full year
|
-
|
-
|
-
|
(36,000
|
)
|
150
|
(35,850
|
)
|
|||||||||||||||||
Transactions with owners in their capacity as owners
|
|||||||||||||||||||||||||
Share-based payments
|
1,138
|
-
|
4,585
|
-
|
-
|
5,723
|
|||||||||||||||||||
Issue of share capital
|
95,047
|
-
|
-
|
-
|
-
|
95,047
|
|||||||||||||||||||
Share issue costs
|
(5,521
|
)
|
-
|
-
|
-
|
-
|
(5,521
|
)
|
|||||||||||||||||
Total transactions with owners in their capacity as owners
|
90,664
|
-
|
4,585
|
-
|
-
|
95,249
|
|||||||||||||||||||
Balance as of June 30, 2021
|
381,890
|
(311
|
)
|
5,979
|
(250,823
|
)
|
(9
|
)
|
136,726
|
||||||||||||||||
Balance as of June 30, 2021
|
381,890
|
(311
|
)
|
5,979
|
(250,823
|
)
|
(9
|
)
|
136,726
|
||||||||||||||||
Net loss after tax for the full year
|
-
|
-
|
-
|
(47,821
|
)
|
-
|
(47,821
|
)
|
|||||||||||||||||
Other comprehensive loss for the full year
|
-
|
-
|
-
|
-
|
(147
|
)
|
(147
|
)
|
|||||||||||||||||
Total comprehensive loss for the full year
|
-
|
-
|
-
|
(47,821
|
)
|
(147
|
)
|
(47,968
|
)
|
||||||||||||||||
Transactions with owners in their capacity as owners
|
|||||||||||||||||||||||||
Share-based payments
|
4.4 |
1,932
|
-
|
1,235
|
-
|
-
|
3,167
|
||||||||||||||||||
Total transactions with owners in their capacity as owners
|
1,932
|
-
|
1,235
|
-
|
-
|
3,167
|
|||||||||||||||||||
Balance as of June 30, 2022
|
383,822
|
(311
|
)
|
7,214
|
(298,644
|
)
|
(156
|
)
|
91,925
|
Balance as of June 30, 2022
|
383,822
|
(311
|
)
|
7,214
|
(298,644
|
)
|
(156
|
)
|
91,925
|
||||||||||||||||
Net loss after tax for the full year
|
-
|
-
|
-
|
(79,223
|
)
|
-
|
(79,223
|
)
|
|||||||||||||||||
Other comprehensive loss for the full year
|
-
|
-
|
-
|
-
|
(62
|
)
|
(62
|
)
|
|||||||||||||||||
Total comprehensive loss for the full year
|
-
|
-
|
-
|
(79,223
|
)
|
(62
|
)
|
(79,285
|
)
|
||||||||||||||||
Transactions with owners in their capacity as owners
|
|||||||||||||||||||||||||
Share-based payments
|
4.4
|
2,610
|
-
|
481
|
-
|
-
|
3,091
|
||||||||||||||||||
Total transactions with owners in their capacity as owners
|
2,610
|
-
|
481
|
-
|
-
|
3,091
|
|||||||||||||||||||
Balance as of June 30, 2023
|
386,432
|
(311
|
)
|
7,695
|
(377,867
|
)
|
(218
|
)
|
15,731
|
Note |
$ |
2023
US ’0007
|
$ |
2023
AU ’000
|
$ |
2022
AU ’000
|
$ |
2021
AU ’000
|
||||||||||||
Cash flow from operating activities
|
||||||||||||||||||||
Receipts from customers
|
30,277
|
45,742
|
33,643
|
30,236
|
||||||||||||||||
Receipt of grants and research and development incentives
|
3.7
|
10,224
|
15,446
|
3,767
|
11,888
|
|||||||||||||||
Payments to suppliers and employees
|
(53,094
|
)
|
(80,215
|
)
|
(81,005
|
)
|
(59,533
|
)
|
||||||||||||
Interest received
|
40
|
61
|
94
|
69
|
||||||||||||||||
Capital raising transaction costs
|
4.7
|
(5,977
|
)
|
(9,030
|
)
|
-
|
-
|
|||||||||||||
Borrowing costs
|
4.2
|
(13,685
|
)
|
(20,676
|
)
|
-
|
-
|
|||||||||||||
Finance costs
|
(2,522
|
)
|
(3,810
|
)
|
(2,475
|
)
|
(1,641
|
)
|
||||||||||||
Net cash used in operating activities
|
4.1.2
|
(34,737
|
)
|
(52,482
|
)
|
(45,976
|
)
|
(18,981
|
)
|
|||||||||||
Cash flow from investing activities
|
||||||||||||||||||||
Payments for property, plant and equipment
|
3.3
|
(8,659
|
)
|
(13,082
|
)
|
(15,634
|
)
|
(12,571
|
)
|
|||||||||||
Payments for intangible assets
|
3.5
|
(3,226
|
)
|
(4,874
|
)
|
(6,007
|
)
|
(3,990
|
)
|
|||||||||||
Sale proceeds from sale of property, plant and equipment
|
3.3
|
2
|
3
|
-
|
-
|
|||||||||||||||
Net cash used in investing activities
|
(11,883
|
)
|
(17,953
|
)
|
(21,641
|
)
|
(16,561
|
)
|
||||||||||||
Cash flow from financing activities
|
||||||||||||||||||||
Proceeds from third party borrowings
|
4.2
|
82,713
|
124,963
|
33,657
|
25,774
|
|||||||||||||||
Repayment of third-party borrowings
|
4.2
|
(28,602
|
)
|
(43,212
|
)
|
(29,370
|
)
|
(12,715
|
)
|
|||||||||||
Repayment of related party borrowings
|
4.2
|
-
|
-
|
-
|
(13,000
|
)
|
||||||||||||||
Proceeds from share issues
|
4.4
|
-
|
-
|
-
|
95,046
|
|||||||||||||||
Reclassification to restricted trust fund
|
4.1
|
(9,715
|
)
|
(14,677
|
)
|
-
|
-
|
|||||||||||||
Capital raising transaction costs
|
-
|
-
|
(422
|
)
|
(5,119
|
)
|
||||||||||||||
Repayment of lease liability
|
(400
|
)
|
(604
|
)
|
(596
|
)
|
(1,040
|
)
|
||||||||||||
Net cash provided by financing activities
|
4.1.3
|
43,996
|
66,470
|
3,269
|
88,946
|
|||||||||||||||
Net (decrease) / increase in cash and cash equivalents held
|
(2,624
|
)
|
(3,965
|
)
|
(64,348
|
)
|
53,404
|
|||||||||||||
Cash and cash equivalents at beginning of financial year
|
15,020
|
22,693
|
87,257
|
33,861
|
||||||||||||||||
Effects of exchange rate changes on cash and cash equivalents
|
565
|
854
|
(216
|
)
|
(8
|
)
|
||||||||||||||
Cash and cash equivalents at end of financial year
|
12,961
|
19,582
|
22,693
|
87,257
|
1. |
Basis of preparation
|
1.1 |
Corporate information
|
1.2 |
Basis of preparation
|
1.3 |
Going concern
|
• |
Carbon Revolution, Twin Ridge, MergeCo, and MergerSub, consummated the business combination pursuant to the terms of a Business Combination Agreement, dated November 29, 2022, as amended or
supplemented from time to time.
|
• |
MergeCo issued US$35 million (A$54.7 million) of Preferred Shares to OIC (Initial Subscription Price) (each, as defined below) and received US$32.5 million (A$49.8 million) in net proceeds.
Carbon Revolution received these proceeds from MergeCo as per the loan agreement (defined below) between MergeCo and Carbon Revolution.
|
• |
Net cash outflows (excluding costs related to the Transaction) from operating activities of approximately $70.5 million, being cash inflows from customers (and grants), less operating costs,
research and development costs, working capital needs, principal repayments, and capital expenditure;
|
•
|
Net cash inflows from financing activities of $33 million, consisting primarily of raising new funding or accessing the Committed Equity Facility (“CEF”)
of $42.3 million and accessing US$5 million (A$7.8 million) of the funds of the OIC Financing held in escrow upon satisfaction of the First Reserve Release (as defined below), offset by $14.1 million of Transaction costs indicated to
be payable during the remainder of the projection period, as well as $3.1 million relating to other financing activities;
|
•
|
From November 2023 onwards, the Group projects to meet its covenants, as amended on October 18, 2023, under the USD
term loan (the “New Debt Program”), except for the Adjusted EBITDA test where management forecasts breaches in February 2024 and August 2024.
If it does not meet a covenant, the Group will seek to utilize the cure rights available to it in accordance with the New Debt Program. Refer
to Note 4.2, Borrowings and other financial liabilities, for information on covenants under the USD term loan, and Note 6.7, Subsequent Events for information on waivers received subsequent to the reporting period.
|
• |
US$35 million (A$54.7 million) have been deposited into an escrow account (“Reserve Funds”).
|
• |
Subject to and on the satisfaction of further conditions, MergeCo will issue US$5 million ($7.8 million) of Preferred Shares to OIC and receive US$5 million ($7.8 million) in funding from the
Reserve Funds if, prior to the Second Reserve Release (as defined below), MergeCo receives aggregate gross proceeds of at least US$10 million ($15.6 million) from one or more issuances and sales of Ordinary Shares to one or more third
party persons (other than OIC and its affiliates) (“First Reserve Release”). The Group projects in its Cash Flow Projection that the First Reserve Release will occur by February 2024.
|
• |
Subject to and on the satisfaction of further conditions by December 1, 2024, or if MergeCo continues to work in good faith to satisfy the relevant condition, January 31, 2025, MergeCo will issue
Preferred Shares to OIC equal in amount to the remaining Reserve Funds plus accrued interest and receive the remaining Reserve Funds (“Second Reserve Release”). The Second Reserve Release is not included in the Cash Flow Projection as
management does not expect the Second Reserve Release to take place within the projection period.
|
• |
In the 24 months following the Initial Closing, MergeCo will, to the extent additional financing is necessary for the development, construction and/or tooling associated with any future
manufacturing facility or for material upgrades to Carbon Revolution’s existing Mega-line plant operations in Australia (“Plant Investments”), have the right, subject to meeting certain conditions described below, to request that OIC
subscribe for up to US$40 million of further Preferred Shares less a 2% subsequent structuring premium (“Subsequent Financing”). Completion of any such Subsequent Financing is subject to approval by OIC’s investment committee. The
Subsequent Financing is not included in the Cash Flow Projection as management does not expect the Subsequent Financing to take place within the projection period.
|
• |
There are no assurances as to when the closing conditions for the OIC Financing for the Reserve Funds or Subsequent Financing will be satisfied;
|
• |
MergeCo’s ability to raise further capital from third parties is subject to consent from OIC (subject to certain limited exceptions); and
|
• |
The MergeCo Board may not be able to act in the best interests of MergeCo or MergeCo Shareholders as a result of the terms of the OIC Documents that impose obligations on MergeCo and its
subsidiaries or restrict their ability to engage in some business activities, which could materially adversely affect MergeCo and Carbon Revolution’s business, results of operations and financial condition.
|
• |
There is no contractual arrangement with the key customer that requires it to accept the request for the bailment and advance payments;
|
• |
The customer may not accept the Group’s request for the bailment and advance payments; and
|
• |
There may be a delay in the customer accepting and making the bailment and advance payments.
|
• |
there may be a delay in the availability of the CEF (the CEF will not be available until after the filing by MergeCo of its annual report for the year ended June 30, 2023, which has not yet been
filed with the SEC and filing with the SEC of a registration statement for the resale of the Ordinary Shares, and such registration statement being declared effective by the SEC);
|
• |
the Group’s advisors that will be assisting in raising capital through the CEF may be unable to dispose of the shares of MergeCo on an ongoing basis. As the terms of the CEF will not require the
advisor to purchase additional shares under the CEF beyond an overall ownership of 9.99% (the CEF Ownership Restriction) or US$10 million (A$15.4 million) per week, whichever is lower, the Group may have access to materially less than the
US$27.5 million projected to be drawn under the CEF during the next 12 months;
|
• |
In order for MergeCo to be able to draw down on the next advance, the CEF provider will be required to sell some or all of its Ordinary Shares issued as part of the first advance on market which,
in the absence of significant demand for Ordinary Shares, may put significant downward pressure on the trading price. This may cause the 9.99% shareholding cap under the next advance to be reached in conjunction with a lower US$ amount of
cash raised under the CEF. This mechanism may create a downward spiral in the share price of MergeCo which may prevent CBR from being able to utilize the CEF to create liquidity;
|
• |
When MergeCo lodges a request to drawdown an amount of equity from the CEF, the CEF Provider is specifically permitted to sell the shares in MergeCo during the period between lodgement of the
request to drawdown and the date the shares are issued to it so that it may manage its risk should it need to. The agreement for the CEF deems a request to drawdown equity from the CEF to be an unconditional contract that is binding on
both parties;
|
• |
The CEF Provider is permitted to sell the shares in MergeCo for which it is bound to subscribe, before it is issued with them, and before it has paid the subscription price. This might be
characterized as short selling of the Ordinary Shares. Accordingly, there exists the potential for the CEF Provider to place downward pressure on the trading price of Ordinary Shares on the public market by short selling shares it does
not yet own. This effect is more severe under the CEF than other ordinary short selling arrangements because the CEF Provider will not subsequently re-enter the public market to purchase the shares it has already sold (and by doing so,
provide support for the trading price) but will instead simply deliver, to either the lender of the covered position or the purchaser if the short sale was naked, the shares subscribed for under the CEF when they are issued; and
|
• |
the Group may not be able to raise further equity funds from sources other than the CEF in the amounts and within the timeframes necessary for the Group to remain solvent and to comply with its
liquidity covenants, on satisfactory terms, or at all.
|
• |
As discussed above, the Group received $49.8 million of initial net proceeds through MergeCo’s OIC Financing as per the loan agreement between MergeCo and Carbon Revolution on November 6, 2023;
|
• |
The Group reached agreement with certain suppliers to defer total payments of $8.9 million including future invoices during the deferral period. Under the terms of these agreements, the deferred
payments are required to be made in November 2023;
|
• |
The Group reached agreement with certain of its advisers relating to the deferral of $23.7 million of transaction fees owed to them at Implementation, with $10.6 million of these fees projected
to be payable during the next 12 month period. Refer to Note 6.7 Subsequent Events;
|
• |
In connection with the OIC Financing, the Group obtained certain amendments to terms of the New Debt Program. Refer Note 6.7 Subsequent
Events.
|
1.4 |
Basis of consolidation
|
• |
assets and liabilities are translated at the closing rate at the reporting date;
|
• |
income and expenses are translated at average exchange rates throughout the course of the year (unless this is not a reasonable approximation of the cumulative effect of the rates prevailing on the transaction dates, in which case
income and expenses are translated at the rates on the dates of the transactions); and
|
• |
all resulting exchange differences are recognized in other comprehensive income and accumulated in the foreign currency translation reserve, a separate component of equity.
|
1.5 |
Significant accounting judgements, estimates and assumptions
|
Note 3.2 Inventories
|
Note 3.5 Intangible assets
|
Note 3.3 Property, plant and equipment
|
Note 5.5 Income tax
|
Note 3.7 Deferred income
|
Note 4.7 Transaction costs
|
Note 4.2 Borrowings and other financial liabilities
|
1.6 |
Goods and Services Tax (“GST”)
|
1. |
Revenues, expenses and assets are recognized net of the amount of associated GST, unless the GST incurred is not recoverable from the taxation authority;
|
2. |
Receivables and payables are stated inclusive of the amount of GST receivable or payable;
|
3. |
The net amount of GST recoverable from, or payable to, the taxation authority is included with other receivables or payables in the consolidated balance sheet;
|
4. |
Cash flows are presented on a gross basis. The GST components of cash flows arising from investing and financing activities are presented as operating cash flows; and
|
5. |
Commitments are disclosed net of GST.
|
|
1.7
|
Convenience translation into U.S. dollars
|
2 |
Operating performance
|
2.1 |
Revenue from contracts with customers
|
2023
$’000
|
2022
$’000
|
2021
$’000
|
||||||||||
External revenue by product line
|
||||||||||||
Sale of wheels
|
37,477
|
38,276
|
32,205
|
|||||||||
Engineering services
|
530
|
464
|
2,732
|
|||||||||
Sale of tooling
|
253
|
1,596
|
-
|
|||||||||
Total revenue
|
38,260
|
40,336
|
34,937
|
2023
$’000
|
2022
$’000
|
2021
$’000
|
||||||||||
External revenue by timing of revenue
|
||||||||||||
Goods transferred at a point in time
|
18,885
|
15,730
|
9,606
|
|||||||||
Goods transferred over time
|
18,592
|
22,546
|
22,599
|
|||||||||
Services transferred at a point in time
|
253
|
1,277
|
1,422
|
|||||||||
Services transferred over time
|
530
|
783
|
1,310
|
|||||||||
Total revenue
|
38,260
|
40,336
|
34,937
|
2023
$’000
|
2022
$’000
|
|||||||||||
Contract asset
|
||||||||||||
Opening balance
|
5,909
|
-
|
||||||||||
Additions
|
24,821
|
5,909
|
||||||||||
Advance payments
|
(13,064
|
)
|
-
|
|||||||||
Transfer to trade receivables
|
(9,427
|
)
|
-
|
|||||||||
Total contract asset
|
8,239
|
5,909
|
2023
$’000
|
2022
$’000
|
|||||||
Contract liability
|
||||||||
Opening balance
|
781
|
-
|
||||||
Additions
|
2,505
|
781
|
||||||
Revenue recognized
|
(783
|
)
|
-
|
|||||
Total contract liability
|
2,503
|
781
|
||||||
Contract liability – current
|
748
|
458
|
||||||
Contract liability – non current
|
1,755
|
323
|
||||||
Total contract liability
|
2,503
|
781
|
2.2 |
Other income
|
2023
$’000
|
2022
$’000
|
2021
$’000
|
||||||||||
Government grants
|
2,777
|
3,506
|
3,504
|
|||||||||
Jobkeeper
|
-
|
-
|
6,835
|
|||||||||
Interest income
|
61
|
94
|
84
|
|||||||||
Foreign exchange gain
|
-
|
448
|
-
|
|||||||||
Other income
|
258
|
272
|
83
|
|||||||||
Total other income
|
3,096
|
4,320
|
10,506
|
2.2.1 |
Information about revenue and other income
|
• |
the customer simultaneously receives and consumes the benefits provided by Carbon Revolution’s performance as Carbon Revolution performs;
|
• |
Carbon Revolution’s performance creates or enhances an asset that the customer controls as Carbon Revolution performs; or
|
• |
Carbon Revolution’s performance does not create an asset with an alternative use to Carbon Revolution and Carbon Revolution has an enforceable right to payment for performance completed to date.
|
2.3 |
Segments
|
2023
$’000
|
2022
$’000
|
2021
$’000
|
||||||||||
Revenue
|
||||||||||||
International
|
38,260
|
40,336
|
34,937
|
|||||||||
Domestic
|
-
|
-
|
-
|
|||||||||
38,260
|
40,336
|
34,937
|
||||||||||
Non-current assets
|
||||||||||||
International
|
-
|
-
|
||||||||||
Domestic
|
86,858
|
79,544
|
||||||||||
86,858
|
79,544
|
2.4 |
Expenses
|
Finance costs
|
2023
$’000
|
2022
$’000
|
2021
$’000
|
|||||||||
Interest on third party loans
|
2,676
|
552
|
400
|
|||||||||
Interest on lease liabilities
|
297
|
301
|
50
|
|||||||||
Finance costs
|
1,448
|
-
|
-
|
|||||||||
Supplier financing costs
|
446
|
213
|
60
|
|||||||||
Interest other
|
635
|
324
|
91
|
|||||||||
Interest on Ronal AG loan
|
-
|
-
|
668
|
|||||||||
Facility costs
|
-
|
-
|
435
|
|||||||||
5,502
|
1,390
|
1,704
|
Wages and salaries
|
39,023
|
33,370
|
26,034
|
|||||||||
Post-employment benefits (defined contribution plans)
|
3,379
|
2,838
|
2,259
|
|||||||||
Share-based payments expense
|
3,091
|
3,167
|
5,723
|
|||||||||
45,493
|
39,375
|
34,016
|
Property, plant and equipment
|
7,382
|
6,919
|
6,391
|
|||||||||
Right of use assets
|
695
|
656
|
687
|
|||||||||
Capitalized development costs
|
2,376
|
1,307
|
520
|
|||||||||
Patents and trademarks
|
89
|
84
|
85
|
|||||||||
10,542
|
8,966
|
7,683
|
Research and development
|
16,180
|
16,933
|
10,513
|
2.4.1 |
Information about expenses
|
Class of fixed asset
|
Depreciation period
|
Depreciation method
|
Leasehold improvements
|
Shorter of 20 years or the remaining term of the lease
|
Straight line
|
Manufacturing plant and equipment
|
2 to 10 years
|
Diminishing value
|
Tooling
|
3 to 10 years
|
Diminishing value
|
Other equipment
|
3 to 5 years
|
Diminishing value
|
2.5 |
Earnings per share
|
2023
$’000
|
2022
$’000
|
2021
$’000
|
||||||||||
The following reflects the income used in the basic and diluted earnings per share computations:
|
||||||||||||
a) Earnings used in calculating earnings per share
|
||||||||||||
Net loss attributable to ordinary equity holders of the parent
|
(79,223
|
)
|
(47,821
|
)
|
(36,000
|
)
|
||||||
b) Weighted average number of shares
|
||||||||||||
Weighted average number of ordinary shares for the purposes of basic earnings per share
|
208,504
|
205,938
|
155,501
|
|||||||||
Effect of dilution
|
||||||||||||
Share options
|
-
|
-
|
-
|
|||||||||
Weighted average number of ordinary shares adjusted for the effect of dilution
|
208,504
|
205,938
|
155,501
|
|||||||||
Loss per share (basic and diluted in cents)
|
$
|
(0.38
|
)
|
$
|
(0.23
|
)
|
$
|
(0.23
|
)
|
|
2023
No.
|
2022
No.
|
2021
No.
|
|||||||||
ESOP
|
4,945,959
|
4,996,896
|
4,996,896
|
|||||||||
LTIP
|
3,151,950
|
3,334,183
|
-
|
|||||||||
Total
|
8,097,909
|
8,331,079
|
4,996,896
|
|
2023
No.
|
2022
No.
|
2021
No.
|
|||||||||
NED Plan
|
43,033
|
43,033
|
107,518
|
|||||||||
LTIP
|
688,142
|
718,345
|
718,345
|
|||||||||
STI
|
851,613
|
595,363
|
333,017
|
|||||||||
TESP
|
233,248
|
321,803
|
125,647
|
|||||||||
SRS
|
42,298
|
113,780
|
360,614
|
|||||||||
Total
|
1,858,334
|
1,792,324
|
1,645,141
|
3.1 |
Receivables
|
2023
$’000
|
2022
$’000
|
|||||||
Trade receivables
|
||||||||
Not past due
|
4,220
|
7,591
|
||||||
Past due 1 – 30 days
|
623
|
3,433
|
||||||
Past due 31 – 90 days
|
443
|
1,445
|
||||||
Past due 90 days and over
|
216
|
684
|
||||||
5,502
|
13,153
|
|||||||
Allowance for impairment losses
|
(119
|
)
|
-
|
|||||
Trade receivables
|
5,383
|
13,153
|
||||||
Apprenticeship grant funding
|
25
|
479
|
||||||
Other receivables
|
267
|
236
|
||||||
GST recoverable
|
755
|
615
|
||||||
Trade and other receivables
|
6,430
|
14,483
|
3.1.1 |
Information about receivables
|
3.2 |
Inventories
|
2023
$’000
|
2022
$’000
|
|||||||
Current
|
||||||||
Raw materials
|
13,301
|
7,646
|
||||||
Work in progress
|
5,772
|
9,688
|
||||||
Finished goods
|
3,649
|
4,318
|
||||||
Consumables and spare parts
|
2,560
|
3,276
|
||||||
Provision for impaired wheels
|
(3,109
|
)
|
(4,764
|
)
|
||||
Inventories at the lower of cost and net realizable value
|
22,173
|
20,164
|
3.2.1 |
Information about inventories and significant estimates
|
• |
Raw materials – recorded at standard cost, reassessed against actual costs quarterly.
|
• |
Finished goods and work-in-progress – cost of direct materials, labor, outsourced processing costs and a proportion of manufacturing overheads based on normal operating capacity but excluding finance costs.
|
• |
Consumables and spare parts – recorded at purchase price. Consumables and spares are assessed for ongoing usefulness and written off if they are no longer likely to be of use.
|
3.3 |
Property, plant and equipment
|
Capital
works in progress
|
Leasehold improvements
|
Manufacturing equipment
|
Tooling
|
Other equipment
|
Total
|
|||||||||||||||||||
$’000 | $’000 | $’000 | $’000 | $’000 | $’000 | |||||||||||||||||||
Gross cost
|
18,950
|
5,649
|
40,454
|
14,326
|
2,784
|
82,163
|
||||||||||||||||||
Less accumulated depreciation
|
-
|
(1,355
|
)
|
(14,070
|
)
|
(7,618
|
)
|
(1,504
|
)
|
(24,547
|
)
|
|||||||||||||
At June 30, 2022
|
18,950
|
4,294
|
26,384
|
6,708
|
1,280
|
57,616
|
||||||||||||||||||
Gross cost
|
17,095
|
5,839
|
52,640
|
16,034
|
2,960
|
94,568
|
||||||||||||||||||
Less accumulated depreciation
|
-
|
(1,642
|
)
|
(18,467
|
)
|
(9,964
|
)
|
(1,857
|
)
|
(31,930
|
)
|
|||||||||||||
At June 30, 2023
|
17,095
|
4,197
|
34,173
|
6,070
|
1,103
|
62,638
|
||||||||||||||||||
Movement in carrying amounts
|
||||||||||||||||||||||||
Balance at June 30, 2021
|
7,138
|
4,466
|
29,716
|
4,737
|
1,262
|
47,319
|
||||||||||||||||||
Additions
|
17,496
|
-
|
-
|
-
|
-
|
17,496
|
||||||||||||||||||
Transfer into/ (out of) capital WIP
|
(5,684
|
)
|
109
|
947
|
4,231
|
397
|
-
|
|||||||||||||||||
Depreciation expense
|
-
|
(281
|
)
|
(4,089
|
)
|
(2,173
|
)
|
(376
|
)
|
(6,919
|
)
|
|||||||||||||
Disposals/write-offs
|
-
|
-
|
(190
|
)
|
(87
|
)
|
(3
|
)
|
(280
|
)
|
||||||||||||||
Balance at June 30, 2022
|
18,950
|
4,294
|
26,384
|
6,708
|
1,280
|
57,616
|
||||||||||||||||||
Additions
|
11,478
|
-
|
-
|
-
|
-
|
11,478
|
||||||||||||||||||
Transfer of maintenance spares
|
-
|
-
|
953
|
-
|
-
|
953
|
||||||||||||||||||
Transfer into/ (out of) capital WIP
|
(13,306
|
)
|
189
|
11,233
|
1,709
|
175
|
-
|
|||||||||||||||||
Depreciation expense
|
-
|
(286
|
)
|
(4,397
|
)
|
(2,347
|
)
|
(352
|
)
|
(7,382
|
)
|
|||||||||||||
Disposals/write-offs
|
(27
|
)
|
-
|
-
|
-
|
-
|
(27
|
)
|
||||||||||||||||
Balance at June 30, 2023
|
17,095
|
4,197
|
34,173
|
6,070
|
1,103
|
62,638
|
3.3.1 |
Information about how Carbon Revolution accounts for property, plant and equipment
|
3.4 |
Leases
|
2023
|
2022
|
|||||||
Right-of-use assets
|
$
|
’000
|
$
|
’000
|
||||
Cost at start of year
|
9,863
|
9,626
|
||||||
Additions
|
577
|
237
|
||||||
Closing balance at end of year
|
10,440
|
9,863
|
||||||
Accumulated depreciation at start of year
|
(2,299
|
)
|
(1,643
|
)
|
||||
Depreciation charge for the year
|
(695
|
)
|
(656
|
)
|
||||
Closing balance at end of year
|
(2,994
|
)
|
(2,299
|
)
|
||||
Carrying amount
|
7,446
|
7,564
|
||||||
Lease liabilities
|
||||||||
Current
|
645
|
579
|
||||||
Non-current
|
7,368
|
7,461
|
||||||
8,013
|
8,040
|
2023
|
2022
|
|||||||
$
|
’000
|
$
|
’000
|
|||||
Depreciation charge of right of use assets
|
695
|
656
|
||||||
Interest expense
|
297
|
301
|
||||||
Expense relating to short-term leases (included in costs of goods sold and administrative expenses)
|
181
|
246
|
||||||
3.4.1 |
Information about leases and significant estimates
|
3.5 |
Intangible assets
|
Development
costs
|
Patents and trademarks
|
Total
|
||||||||||
$’000
|
$’000
|
$’000
|
||||||||||
Gross cost
|
15,750
|
1,354
|
17,104
|
|||||||||
Less accumulated amortization
|
(2,247
|
)
|
(493
|
)
|
(2,740
|
)
|
||||||
At June 30, 2022
|
13,503
|
861
|
14,364
|
|||||||||
Gross cost
|
20,442
|
1,537
|
21,979
|
|||||||||
Less accumulated amortization
|
(4,623
|
)
|
(582
|
)
|
(5,205
|
)
|
||||||
At June 30, 2023
|
15,819
|
955
|
16,774
|
|||||||||
Movement in carrying amounts
|
||||||||||||
Balance at July 1, 2021
|
8,890
|
859
|
9,749
|
|||||||||
Additions
|
5,920
|
86
|
6,006
|
|||||||||
Amortization
|
(1,307
|
)
|
(84
|
)
|
(1,391
|
)
|
||||||
Balance at June 30, 2022
|
13,503
|
861
|
14,364
|
|||||||||
Additions
|
4,692
|
183
|
4,875
|
|||||||||
Amortization
|
(2,376
|
)
|
(89
|
)
|
(2,465
|
)
|
||||||
Balance at June 30, 2023
|
15,819
|
955
|
16,774
|
3.5.1 |
Information about intangible assets and significant estimates
|
Post-tax
discount rate
|
Terminal
value
growth rate
|
Annual
reduction in
wheel volume
|
Annual
increase in
direct material
costs
|
Annual
increase in
direct labor
costs
|
|
1%
|
(1%)
|
(5%)
|
5%
|
5%
|
|
Change in recoverable amount in $m
|
(21.0)
|
(14.7)
|
(30.6)
|
(23.6)
|
(16.7)
|
Impairment charge
|
-
|
-
|
-
|
-
|
-
|
3.6 |
Payables
|
2023
$’000
|
2022
$’000
|
|||||||
Current
|
||||||||
Unsecured liabilities
|
||||||||
Trade payables
|
3,828
|
5,128
|
||||||
Accruals
|
10,836
|
3,746
|
||||||
Interest accrued
|
427
|
118
|
||||||
Other payables
|
383
|
510
|
||||||
15,474
|
9,502
|
3.6.1 |
Information about payables
|
3.6.2 |
Accruals
|
3.7 |
Deferred income
|
Deferred income – government grants
|
2023
$’000
|
2022
$’000
|
||||||
Balance as of July 1
|
6,239
|
5,842
|
||||||
Received during the year
|
13,000
|
3,202
|
||||||
Released to the statement of profit or loss
|
(2,085
|
)
|
(2,805
|
)
|
||||
Balance as of June 30
|
17,154
|
6,239
|
||||||
Current
|
1,919
|
1,028
|
||||||
Non-current
|
15,235
|
5,211
|
||||||
17,154
|
6,239
|
3.8 |
Provisions
|
Employee benefits
|
Make good provision
|
Warranty claims
|
Transaction costs
|
Total
|
||||||||||||||||
$’000
|
$’000
|
$’000
|
$’000
|
$’000
|
||||||||||||||||
Current
|
2,666
|
-
|
1,495
|
-
|
4,161
|
|||||||||||||||
Non-current
|
479
|
234
|
-
|
-
|
713
|
|||||||||||||||
At June 30, 2022
|
3,145
|
234
|
1,495
|
-
|
4,874
|
Employee benefits
|
Make good provision
|
Warranty claims
|
Transaction costs
|
Total
|
||||||||||||||||
$’000
|
$’000
|
$’000
|
$’000
|
$’000
|
||||||||||||||||
Current
|
2,903
|
-
|
595
|
9,459
|
12,957
|
|||||||||||||||
Non-current
|
531
|
247
|
1,065
|
-
|
1,843
|
|||||||||||||||
At June 30, 2023
|
3,434
|
247
|
1,660
|
9,459
|
14,800
|
Make good provision
|
Warranty claims
|
Total
|
||||||||||
$’000
|
$’000
|
$’000
|
||||||||||
Movement in carrying amounts
|
||||||||||||
Balance at July 1, 2021
|
218
|
1,159
|
1,377
|
|||||||||
Provided for/ (released) during the year
|
16
|
336
|
352
|
|||||||||
Balance at June 30, 2022
|
234
|
1,495
|
1,729
|
|||||||||
Provided for/(released) during the year
|
13
|
165
|
178
|
|||||||||
Balance at June 30, 2023
|
247
|
1,660
|
1,907
|
3.8.1 |
Information about individual provisions and significant estimates
|
4.1 |
Cash and cash equivalents, restricted trust fund
|
2023
$’000
|
2022
$’000
|
2021
$’000
|
||||||||||
Loss after income tax
|
(79,223
|
)
|
(47,821
|
)
|
(36,000
|
)
|
||||||
Non‑cash items from ordinary activities
|
||||||||||||
Depreciation and amortization
|
10,543
|
8,966
|
7,683
|
|||||||||
Share based payment expenses
|
3,091
|
3,167
|
5,723
|
|||||||||
Loss/ (Profit) on sale of plant and equipment
|
2
|
-
|
-
|
|||||||||
Movement in inventory provision
|
(1,656
|
)
|
(4,216
|
)
|
4,563
|
|||||||
Write off of property, plant and equipment
|
-
|
280
|
1,230
|
|||||||||
Financing activity in prior financial year
|
-
|
(422
|
)
|
-
|
||||||||
Reduction of borrowings from achievement of grant milestones
|
-
|
-
|
(2,000
|
)
|
||||||||
Other Borrowing costs
|
(20,676
|
)
|
-
|
-
|
||||||||
Changes in assets and liabilities
|
||||||||||||
(Increase)/decrease in assets:
|
||||||||||||
- Receivables
|
8,053
|
(8,240
|
)
|
(4,272
|
)
|
|||||||
- Contract assets
|
(2,330
|
)
|
-
|
-
|
||||||||
- Inventories
|
(1,306
|
)
|
2,231
|
5,084
|
||||||||
- Other assets
|
1,209
|
(533
|
)
|
(243
|
)
|
|||||||
Increase/(decrease) in liabilities:
|
||||||||||||
- Payables
|
7,247
|
(1,174
|
)
|
(5,270
|
)
|
|||||||
- Contract liabilities
|
1,722
|
781
|
-
|
|||||||||
- Deferred income
|
10,915
|
397
|
3,627
|
|||||||||
- Provisions
|
9,927
|
608
|
894
|
|||||||||
Cash (used in) / provided by operating activities
|
(52,482
|
)
|
(45,976
|
)
|
(18,981
|
)
|
2023
|
Non-cash changes
|
|||||||||||||||||||||||||||
Note
|
July 1, 2022
$’000
|
Financing
cash flows (i)
$’000
|
New
leases
$’000
|
Other
changes (ii)
$’000
|
Interest
paid
$’000
|
June 30, 2023
$’000
|
||||||||||||||||||||||
Current borrowings at amortized cost
|
||||||||||||||||||||||||||||
Secured
|
||||||||||||||||||||||||||||
Working capital facility
|
4.2
|
6,843
|
(6,843
|
)
|
320
|
(320
|
)
|
-
|
||||||||||||||||||||
Term loan
|
4.2
|
2,889
|
(2,889
|
)
|
-
|
830
|
(830
|
)
|
-
|
|||||||||||||||||||
Letter of credit facility
|
4.2
|
4,000
|
(4,000
|
)
|
-
|
64
|
(64
|
)
|
-
|
|||||||||||||||||||
Unsecured
|
||||||||||||||||||||||||||||
Term loan with customer
|
4.2
|
-
|
4,523
|
-
|
111
|
(111
|
)
|
4,523
|
||||||||||||||||||||
Supplier financing arrangement
|
4.2
|
4,954
|
4,352
|
-
|
446
|
(446
|
)
|
9,306
|
||||||||||||||||||||
Non-current borrowings at amortized cost
|
||||||||||||||||||||||||||||
Secured
|
||||||||||||||||||||||||||||
Term loan
|
4.2
|
4,333
|
(4,333
|
)
|
-
|
-
|
-
|
-
|
||||||||||||||||||||
Term loan (USD)(iii)
|
4.2
|
-
|
70,625
|
-
|
2,194
|
(1,626
|
)
|
70,833
|
||||||||||||||||||||
Lease liabilities
|
3.4
|
8,040
|
(604
|
)
|
577
|
297
|
(297
|
)
|
8,013
|
|||||||||||||||||||
31,059
|
60,471
|
577
|
4,262
|
(3,694
|
)
|
92,675
|
2022
|
Non-cash changes
|
|||||||||||||||||||||||||||
Note
|
July 1, 2021
$’000
|
Financing
cash flows (i)
$’000
|
New
leases
$’000
|
Other
changes (ii)
$’000
|
Interest
paid
$’000
|
June 30, 2022
$’000
|
||||||||||||||||||||||
Current borrowings at amortized cost
|
||||||||||||||||||||||||||||
Secured
|
||||||||||||||||||||||||||||
Working capital facility
|
4.2
|
5,525
|
1,318
|
324
|
(324
|
)
|
6,843
|
|||||||||||||||||||||
Term loan
|
4.2
|
4,333
|
(1,444
|
)
|
-
|
552
|
(552
|
)
|
2,889
|
|||||||||||||||||||
Letter of credit facility
|
4.2
|
-
|
4,000
|
-
|
-
|
-
|
4,000
|
|||||||||||||||||||||
Unsecured
|
||||||||||||||||||||||||||||
Supplier financing arrangement
|
4.2
|
2,375
|
2,579
|
-
|
213
|
(213
|
)
|
4,954
|
||||||||||||||||||||
Non-current borrowings at amortized cost
|
||||||||||||||||||||||||||||
Secured
|
||||||||||||||||||||||||||||
Term loan
|
4.2
|
6,529
|
(2,196
|
)
|
-
|
-
|
-
|
4,333
|
||||||||||||||||||||
Lease liabilities
|
3.4
|
8,355
|
(552
|
)
|
237
|
301
|
(301
|
)
|
8,040
|
|||||||||||||||||||
27,117
|
3,705
|
237
|
1,390
|
(1,390
|
)
|
31,059
|
2021
|
Non-cash changes
|
|||||||||||||||||||||||
July 1, 2020
$’000
|
Financing
cash flows (i)
$’000
|
New
leases
$’000
|
Other
changes (ii)
$’000
|
Interest
paid
$’000
|
June 30, 2021
$’000
|
|||||||||||||||||||
Current borrowings at amortized cost
|
||||||||||||||||||||||||
Secured
|
||||||||||||||||||||||||
Working capital facility
|
-
|
5,525
|
-
|
30
|
(30
|
)
|
5,525
|
|||||||||||||||||
Term loan
|
-
|
4,333
|
-
|
371
|
(371
|
)
|
4,333
|
|||||||||||||||||
Unsecured
|
||||||||||||||||||||||||
Supplier financing arrangement
|
-
|
2,375
|
-
|
18
|
(18
|
)
|
2,375
|
|||||||||||||||||
Ronal AG loan facility
|
13,000
|
(13,000
|
)
|
-
|
931
|
(931
|
)
|
-
|
||||||||||||||||
Insurance premium funding
|
174
|
(174
|
)
|
-
|
-
|
-
|
-
|
|||||||||||||||||
State of Victoria loan
|
5,500
|
(5,500
|
)
|
-
|
-
|
-
|
-
|
|||||||||||||||||
Non-current borrowings at amortized cost
|
||||||||||||||||||||||||
Secured
|
||||||||||||||||||||||||
Term loan
|
-
|
6,529
|
-
|
-
|
-
|
6,529
|
||||||||||||||||||
Lease liabilities
|
9,519
|
(1,379
|
)
|
215
|
291
|
(291
|
)
|
8,355
|
||||||||||||||||
28,193
|
(1,291
|
)
|
215
|
1,641
|
(1,641
|
)
|
27,117
|
4.2 |
Borrowings and other financial liabilities
|
Interest rate
%
|
Maturity
|
2023
$’000
|
2022
$’000
|
|||||||||||
Current borrowings at amortized cost
|
||||||||||||||
Secured
|
||||||||||||||
Working capital facility
|
7.44
|
%
|
May 2023
|
-
|
6,843
|
|||||||||
Term loan
|
6.15
|
%
|
May 2023
|
-
|
2,889
|
|||||||||
Letter of credit facility
|
6.45
|
%
|
May 2023
|
-
|
4,000
|
|||||||||
-
|
13,732
|
|||||||||||||
Unsecured
|
||||||||||||||
Term loan with customer
|
10.0
|
%
|
June 2024
|
4,523
|
-
|
|||||||||
Supplier finance arrangement
|
6% + RBA cash rate
|
9,306
|
4,954
|
|||||||||||
13,829
|
18,686
|
|||||||||||||
Non-current borrowings at amortized cost
|
||||||||||||||
Secured
|
||||||||||||||
Term loan
|
6.15
|
%
|
December 2024
|
-
|
4,333
|
|||||||||
Term loan (USD)
|
8.50
|
%
|
May 2027
|
70,833
|
-
|
|||||||||
70,833
|
4,333
|
4.3 |
Financial risk management
|
4.3.1 |
Market risk
|
a) |
Foreign currency risk
|
2023
|
EUR
$’000
|
USD
$’000
|
||||||
Cash and cash equivalent
|
632
|
7,422
|
||||||
Restricted trust fund
|
-
|
9,456
|
||||||
Trade receivables
|
2,409
|
400
|
||||||
Trade payables
|
(419
|
)
|
(813
|
)
|
||||
Supplier finance arrangement
|
(4,709
|
)
|
(414
|
)
|
||||
Borrowings
|
-
|
(46,320
|
)
|
|||||
Balance sheet exposure
|
(2,087
|
)
|
(30,269
|
)
|
2022
|
EUR
$’000
|
USD
$’000
|
||||||
Trade receivables
|
5,650
|
-
|
||||||
Trade payables
|
(343
|
)
|
(233
|
)
|
||||
Supplier finance arrangement
|
(3,253
|
)
|
(13
|
)
|
||||
Balance sheet exposure
|
2,054
|
(246
|
)
|
2023
$’000
|
2022
$’000
|
|||||||
Net foreign exchange gain/(loss) included in other income/administration expense
|
(305
|
)
|
448
|
+/- 5% exchange rate
|
2023
$’000
|
2022
$’000
|
||||||
Impact on profit after tax
|
1,618
|
90
|
||||||
Impact on equity
|
(1,618
|
)
|
(90
|
)
|
b) |
Interest rate risk
|
Variable interest rate
|
Fixed interest rate
|
Total
|
||||||||||||||||||||||
2023
$’000
|
2022
$’000
|
2023
$’000
|
2022
$’000
|
2023
$’000
|
2022
$’000
|
|||||||||||||||||||
Financial assets
|
||||||||||||||||||||||||
Cash
|
19,582
|
22,301
|
-
|
-
|
19,582
|
22,301
|
||||||||||||||||||
Restricted trust fund
|
14,285
|
-
|
-
|
-
|
14,285
|
-
|
||||||||||||||||||
Short term deposits
|
-
|
-
|
392
|
392
|
392
|
392
|
||||||||||||||||||
Total financial assets
|
33,867
|
22,301
|
392
|
392
|
34,259
|
22,693
|
||||||||||||||||||
Financial liabilities
|
||||||||||||||||||||||||
Working capital facility
|
-
|
6,843
|
-
|
-
|
-
|
6,843
|
||||||||||||||||||
Term loan
|
-
|
-
|
4,523
|
-
|
4,523
|
-
|
||||||||||||||||||
Supplier finance arrangement
|
9,306
|
-
|
-
|
4,954
|
9,306
|
4,954
|
||||||||||||||||||
Letter of credit facility
|
-
|
4,000
|
-
|
-
|
-
|
4,000
|
||||||||||||||||||
Term loan
|
-
|
7,222
|
-
|
-
|
-
|
7,222
|
||||||||||||||||||
Term loan (USD)
|
-
|
-
|
90,645
|
- |
90,645
|
-
|
||||||||||||||||||
Total financial liabilities
|
9,306
|
18,065
|
95,168
|
4,954
|
104,474
|
23,019
|
c) |
Price risk
|
4.3.2 |
Credit risk
|
4.3.3 |
Liquidity risk
|
On demand
$’000
|
< 3 months
$’000
|
3-12 months
$’000
|
1-5 years
$’000
|
> 5 years
$’000
|
Total
$’000
|
|||||||||||||||||||
2023
|
||||||||||||||||||||||||
Supplier finance arrangement
|
9,306
|
-
|
-
|
-
|
-
|
9,306
|
||||||||||||||||||
Term loan
|
-
|
-
|
4,523
|
-
|
-
|
4,523
|
||||||||||||||||||
Lease liabilities
|
-
|
158
|
487
|
2,830
|
4,538
|
8,013
|
||||||||||||||||||
Term loan (USD)
|
-
|
-
|
-
|
90,645
|
-
|
90,645
|
||||||||||||||||||
9,306
|
158
|
5,010
|
93,475
|
4,538
|
112,487
|
|||||||||||||||||||
2022
|
||||||||||||||||||||||||
Working capital facility
|
-
|
6,843
|
-
|
-
|
-
|
6,843
|
||||||||||||||||||
Supplier finance arrangement
|
4,954
|
-
|
-
|
-
|
-
|
4,954
|
||||||||||||||||||
Letter of credit facility
|
-
|
-
|
4,000
|
-
|
-
|
4,000
|
||||||||||||||||||
Term loan
|
-
|
-
|
2,889
|
4,333
|
-
|
7,222
|
||||||||||||||||||
Lease liabilities
|
-
|
95
|
483
|
2,541
|
4,921
|
8,040
|
||||||||||||||||||
4,954
|
6,938
|
7,372
|
6,874
|
4,921
|
31,059
|
4.3.4 |
Fair value risk
|
4.4 |
Contributed equity
|
June 30, 2023
# Ordinary shares
|
June 30, 2022
# Ordinary shares
|
June 30, 2023
$’000
|
June 30, 2022
$’000
|
|||||||||||||
Ordinary shares – fully paid
|
211,877,653
|
206,326,138
|
386,432
|
383,822
|
||||||||||||
Ordinary shares – restricted
|
274,852
|
527,889
|
-
|
-
|
||||||||||||
Total share capital
|
212,152,505
|
206,854,027
|
386,432
|
383,822
|
2022
|
Date
|
# Shares
|
|
$’000
|
|||||
Balance
|
July 1, 2021
|
205,421,449
|
381,890
|
||||||
Shares issued under Employee Share Plan
|
904,689
|
1,932
|
|||||||
Balance of fully paid shares
|
June 30, 2022
|
206,326,138
|
383,822
|
2023
|
Date
|
# Shares
|
|
$’000
|
|||||
Balance
|
July 1, 2022
|
206,326,138
|
383,822
|
||||||
Shares issued under Employee Share Plan
|
5,551,515
|
2,610
|
|||||||
Balance of fully paid shares
|
June 30, 2023
|
211,877,653
|
386,432
|
4.4.1 |
Information about contributed equity
|
4.5 |
Share-based payment plan arrangements
|
a) |
Elapse of three years from the date of grant; or
|
b) |
Listing of Carbon Revolution’s shares on the ASX or earlier release of exercise restrictions by the board.
|
2023
|
2022
|
|||||||
Grant date
|
-
|
Dec 2021
|
||||||
Number of employees granted shares
|
-
|
266
|
||||||
Value of shares granted per employee (on FTE and length of service pro-rata basis)
|
-
|
$
|
279-$1,000
|
|||||
Total number of shares
|
-
|
255,281
|
||||||
Fair value at grant date
|
-
|
$
|
1.01
|
• |
Issue date December 23, 2019
|
• |
Exercise price $2.60 (IPO price)
|
• |
Vesting date – December 23, 2022
|
• |
Term of 5 years (exercise window from December 23, 2022 to December 23, 2024)
|
• |
Issue date December 20, 2021
|
• |
Exercise price $1.60
|
• |
Vesting date – October 28, 2024
|
• |
Term of 5 years (exercise window from October 28, 2024 to October 28, 2026)
|
4.6 |
Reserves
|
2023
$’000
|
2022
$’000
|
|||||||
Share-based payments
|
7,695
|
7,214
|
||||||
Share buyback
|
(311
|
)
|
(311
|
)
|
||||
Foreign currency translation
|
(218
|
)
|
(156
|
)
|
||||
7,166
|
6,747
|
4.6.1 |
Information about reserves
|
4.7 |
Transaction costs
|
2023
$’000
|
2022
$’000
|
2021
$’000
|
||||||||||
Transaction costs recognized in the statements of profit or loss and other comprehensive income
|
24,746
|
-
|
-
|
|||||||||
Transaction costs recognized in trade payables
|
541
|
-
|
-
|
|||||||||
Transaction costs recognized in accruals
|
5,716
|
-
|
-
|
|||||||||
Transaction costs recognized in provisions
|
9,459
|
-
|
-
|
|||||||||
Transaction costs recognized in the operating cash flow
|
9,030
|
-
|
-
|
2023
$’000
|
2022
$’000
|
2021
$’000
|
||||||||||
Consolidated statements of profit or loss
|
||||||||||||
Current income tax charge/benefit
|
-
|
-
|
-
|
|||||||||
Adjustment for current tax relating to prior periods
|
-
|
-
|
-
|
|||||||||
Deferred income tax relating to the origination and reversal of temporary differences
|
-
|
-
|
-
|
|||||||||
-
|
-
|
-
|
2023
$’000
|
2022
$’000
|
2021
$’000
|
||||||||||
The prima facie tax benefit on loss before tax differs from the income tax expense as follows:
|
||||||||||||
Accounting loss before tax
|
(79,223
|
)
|
(47,821
|
)
|
(36,000
|
)
|
||||||
Benefit at the Australian statutory income tax rate of 30% (2022: 30%)
|
23,767
|
14,346
|
10,800
|
|||||||||
Tax impact of:
|
||||||||||||
Non-deductible expenses
|
(4,859
|
)
|
(5,083
|
)
|
(4,964
|
)
|
||||||
Non-assessable income
|
-
|
-
|
||||||||||
Impact of different tax rates in foreign jurisdictions
|
29
|
54
|
(50
|
)
|
||||||||
Current year taxable loss not recognized
|
(18,937
|
)
|
(9,317
|
)
|
(5,786
|
)
|
||||||
Income tax benefit
|
-
|
-
|
-
|
2023
$’000
|
2022
$’000
|
|||||||
Deferred tax liabilities relating to temporary differences:
|
||||||||
Receivables
|
-
|
(25
|
)
|
|||||
Intangible assets
|
(4,746
|
)
|
(4,050
|
)
|
||||
Property, plant and equipment
|
(12,841
|
)
|
(6,551
|
)
|
||||
(17,587
|
)
|
(10,626
|
)
|
|||||
Deferred tax assets related to temporary differences:
|
||||||||
Provisions and accruals
|
6,981
|
3,785
|
||||||
Capital raising costs
|
7,833
|
1,960
|
||||||
Tax losses
|
2,682
|
-
|
||||||
Other
|
91
|
89
|
||||||
Total |
17,587
|
5,834
|
||||||
Net deferred tax liability
|
-
|
(4,792
|
)
|
|||||
Less: temporary differences not recognized
|
-
|
4,792
|
||||||
Net deferred tax recognized in the statement of financial position
|
-
|
-
|
Country of
|
% equity interest
|
|||
Name
|
Principal activities
|
incorporation
|
2023
|
2022
|
Carbon Revolution Operations Pty Ltd
|
Carbon fiber wheels
|
Australia
|
100
|
100
|
Carbon Revolution Technology Pty Ltd
|
Carbon fiber wheels
|
Australia
|
100
|
100
|
Carbon Revolution (USA) LLC
|
Carbon fiber wheels
|
United States
|
100
|
100
|
Carbon Revolution (UK) Limited | Carbon fiber wheels | United Kingdom | 100 | 100 |
6.2 |
Directors and Key management personnel
|
2023
$
|
2022
$
|
2021
$
|
||||||||||
Compensation by category
|
||||||||||||
Short-term employment benefits
|
2,211,445
|
2,195,825
|
1,037,034
|
|||||||||
Post-employment benefits
|
99,352
|
96,132
|
82,020
|
|||||||||
Share-based payments
|
-
|
-
|
1,251,222
|
|||||||||
2,310,797
|
2,291,957
|
2,370,276
|
6.3 |
Transactions with related parties
|
6.4 |
Unrecognized items
|
6.4.1 |
Guarantees
|
6.4.2 |
Capital commitments
|
6.4.3 |
Contingent liabilities
|
6.5 |
Changes in accounting policies
|
• |
Annual Improvements to IFRS Standards 2018–2020
|
• |
Onerous Contracts — Cost of Fulfilling a Contract (Amendments to IAS 37)
|
• |
Reference to the Conceptual Framework (Amendments to IFRS 3)
|
• |
International Tax Reform — Pillar Two Model Rules (Amendments to IAS 12) — Application of the exception and disclosure of that fact
|
6.6 |
Accounting standards issued but not yet effective at June 30, 2023
|
Standard and Interpretation
|
Effective for annual reporting periods beginning on or after
|
Expected to be initially applied in the financial year ending
|
Narrow scope amendments to IAS 1, Practice statement 2 and IAS 8
|
January 1, 2023
|
June 30, 2024
|
Amendment to IAS 12 – deferred tax related to assets and liabilities arising from a single transaction
|
January 1, 2023
|
June 30, 2024
|
Amendment to IFRS 16 – Leases on sale and leaseback
|
January 1, 2024
|
June 30, 2024
|
Amendments to IAS 1 – Non-current liabilities with covenants
|
January 1, 2024
|
June 30, 2024
|
Amendments to IAS 7 and IFRS 7 on Supplier finance arrangements
|
January 1, 2024
|
June 30, 2024
|
Amendments to IAS 8 – Definition of Accounting Estimates
|
January 1, 2023
|
June 30, 2024
|
6.7 |
Subsequent events
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• |
On November 3, 2023 (the “Initial Closing”), MergeCo issued US$35 million of Preferred
Shares to OIC (Initial Tranche) and received US$35 million in aggregate gross proceeds, less amounts applied to cover certain
transaction costs and an initial structuring premium payable to an entity associated with OIC of US$1.75 million (Initial Structuring Premium).
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•
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On the Initial Closing, the Reserve Funds were deposited into an escrow account.
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• |
Subject to and on the satisfaction of further conditions (see below), MergeCo will issue
US$5 million of Preferred Shares to OIC and receive US$5 million in funding from the Reserve
Funds if, prior to the Second Reserve Release (as defined below), the Company receives aggregate gross proceeds of at least US$10 million ($15.6 million) from one or more issuances and sales of Ordinary Shares to
one or more third party persons (other than OIC and its affiliates) pursuant to the First Reserve Release.
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• |
Subject to and on the satisfaction of further conditions by December 1, 2024, or if MergeCo
continues to work in good faith to satisfy the relevant condition, January 31, 2025, MergeCo will issue Preferred Shares to OIC
equal in amount to the remaining Reserve Funds plus accrued interest and receive the remaining Reserve Funds pursuant to the Second Reserve Release.
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• |
In the 24 months following the Initial Closing, MergeCo will, to the extent additional
financing is necessary for the development, construction and/or tooling associated with any future manufacturing facility or
for material upgrades to Carbon Revolution’s existing Mega-line plant operations in Australia (Plant Investments), have the right, subject to meeting
certain conditions described below, to request a Subsequent Financing. Completion of any such Subsequent Financing
is subject to approval by OIC’s investment committee.
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•
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has a term of up to five years from the Initial Closing and may be redeemed earlier at the election of
MergeCo;
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• |
is entitled to a fixed rate of dividend of 12% per annum, which accrues daily and is payable
quarterly in cash or in kind by the issue of additional Preferred Shares at MergeCo’s election; and
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•
|
is expected to be accounted for as borrowings.
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•
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12.49%, on and from the Initial Closing; plus
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•
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5%, following the issue of Preferred Shares to OIC in connection with the Second Reserve Release; plus
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•
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2.5%, subject to OIC not having failed to fund a Subsequent Financing upon the satisfaction of the relevant
conditions by MergeCo, upon the earlier of:
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•
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for so long as holders of the OIC Warrant beneficially hold 10% of the aggregate number of outstanding Ordinary Shares
calculated on a fully diluted basis:
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o
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issue Ordinary Shares
at a price per share less than 75% of the daily volume weighted average price of Ordinary Shares for the trading day immediately
preceding the issuance. OIC is deemed to have waived this consent right if all relevant conditions (excluding approval by OIC’s investment committee) have been satisfied by MergeCo but OIC fails to fund a Subsequent Financing
(Subsequent Commitment Amount less 2% subsequent structuring premium);
|
o
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issue Ordinary Shares,
if after such an issuance, holders of the OIC Warrant would be diluted to less than 10% of the aggregate number of
outstanding Ordinary Shares calculated on a fully diluted basis (a “Dilutive Issuance”). OIC is deemed to have waived this consent
right if all relevant conditions (excluding approval by OIC’s investment committee) have been satisfied by MergeCo but OIC fails to fund a Subsequent Financing or OIC previously provided their consent to a Dilutive Issuance; or
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•
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amend MergeCo’s constitution in a manner that would be materially adverse to OIC as a holder of the OIC Warrant or as a member of MergeCo.
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Exhibit No.
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Description
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Amended and Restated Memorandum and Articles of Association of Carbon Revolution Public Limited Company
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||
Specimen Ordinary Shares Certificate of Carbon Revolution Public Limited Company
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||
Warrant Certificate of Carbon Revolution Public Limited Company
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||
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Business Combination Agreement, dated as of November 29, 2022, by and among Twin Ridge Capital Acquisition Corp., Carbon Revolution Limited, Poppetell Limited and Poppettell Merger Sub (incorporated by reference to Annex A to the
Registration Statement on Form F-4 (333-270047)).
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|
Amendment to the Business Combination Agreement, dated as of October 5, 2023, by and among Twin Ridge Capital Acquisition Corp., Carbon Revolution Limited, Poppetell Limited and Poppettell Merger Sub (incorporated by reference to Annex
A to Supplement No. 2 to the proxy/statement prospectus dated September 8, 2023 filed on October 5, 2023)).
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||
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Scheme Implementation Deed, dated as of November 30, 2022, by and among Carbon Revolution Limited, Twin Ridge Capital Acquisition Corp. and Poppetell Limited (incorporated by reference to Annex B to the Registration Statement on Form
F-4 (333-270047)).
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|
Scheme Implementation Amendment (incorporated by reference to Annex E to Supplement No. 1 to the proxy/statement prospectus dated September 8, 2023 filed on September 25, 2023)).
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||
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Warrant Agreement, dated March 3, 2021, by and among Twin Ridge Capital Acquisition Corp. and Continental Stock Transfer & Trust Company, as warrant agent (incorporated by reference to Exhibit 4.3 to the Registration Statement on
Form F-4 (333-270047)).
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Assignment and Assumption Agreement between Twin Ridge Capital Acquisition Corp., Carbon Revolution Public Limited Company (formerly known as Poppetell Limited), Computershare Inc. and Computershare Trust Company, N.A. (included as
Annex D to the Registration Statement on Form F-4 (333-270047)).
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|
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Warrant Amendment Agreement between Twin Ridge Capital Acquisition Corp., Continental Stock Transfer & Trust Company, Computershare Inc. and Computershare Trust Company, N.A. (included as Annex E to the Registration Statement on
Form F-4 (333-270047)).
|
|
|
Letter Agreement, dated March 3, 2021, by and among Twin Ridge Capital Acquisition Corp., Barclays Capital Inc. and Evercore Group, LLC (incorporated by reference to Exhibit 10.4 of Twin Ridge Capital Acquisition Corp.’s Form 8-K,
filed with the SEC on March 9, 2021).
|
|
|
Sponsor Side Letter, dated as of November 29, 2022, by and among Twin Ridge Capital Sponsor, LLC, Twin Ridge Capital Sponsor Subsidiary, LLC, the independent directors party thereto, the other insiders party thereto, Twin Ridge Capital
Acquisition Corp., Carbon Revolution Limited, and Poppetell Limited (included as Annex F to the Form F-4).
|
|
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Proceeds Disbursing and Security Agreement, dated May 23, 2023 by and among UMB Bank, N.A., as trustee and disbursing Agent, Newlight Capital LLC, as servicer, collateral agent and security trustee and Carbon Revolution Operations PTY
LTD.
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|
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Equity Incentive Plan of the Company.
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|
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Service Agreement with Jacob Dingle, dated March 14, 2017 (incorporated by reference to Exhibit 10.5 to the Registration Statement on Form F-4 (333-270047)).
|
|
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Service Agreement with Gerard Buckle, dated August 7, 2019 (incorporated by reference to Exhibit 10.6 to the Registration Statement on Form F-4 (333-270047)).
|
|
Form of Voluntary Escrow Deed (incorporated by reference to Annex H to the Registration Statement on Form F-4 (333-270047)).
|
|
Securities Purchase Agreement, by and among the Company, Carbon Revolution Operations Pty Ltd and OIC Investors, dated September 21, 2023 (incorporated by reference to Annex B to Supplement No. 1 to the proxy/statement prospectus dated
September 8, 2023 filed on September 25, 2023)).
|
||
Form of Company OIC Warrant to purchase Ordinary Shares (incorporated by reference to Annex C to Supplement No. 1 to the proxy/statement prospectus dated September 8, 2023 filed on September 25, 2023)).
|
||
Shareholder’s Agreement between the Company and OIC Investors, dated as of September 18, 2023 (incorporated by reference to Annex D to Supplement No. 1 to the proxy/statement prospectus dated September 8, 2023 filed on September 25,
2023)).
|
||
Second Amendment to Proceeds Disbursing and Security Agreement, dated September 18, 2023, between UMB Bank, National Association, Newlight Capital LLC, Carbon Revolution Operations Pty Ltd, Carbon Revolution Technology Pty Ltd and
Carbon Revolution (incorporated by reference to Annex F to Supplement No. 1 to the proxy/statement prospectus dated September 8, 2023 filed on September 25, 2023)).
|
||
|
Form of Indemnification Agreement between Carbon Revolution Public Limited Company and each of its directors and officers (incorporated by reference to Exhibit 10.8 to the Registration Statement on Form F-4 (333-270047)).
|
|
4.20† |
Form of Lock Up Agreement
|
|
4.21† |
Registration Rights Agreement, dated as of November 3, 2023, among the Company, Twin Ridge, DDGN Advisors LLC and the individuals listed on the signature pages thereto.
|
|
|
List of Subsidiaries of the Company
|
|
Insider Trading Policy
|
||
Unaudited Pro Forma Condensed Combined Financial Information of the Company and Twin Ridge.
|
||
15.2† |
Letter dated November 9, 2023 from Deloitte Touche Tohmatsu, pertaining to Item 16F.
|
|
15.3† |
List of Relevant Territories for Irish Tax Purposes.
|
|
Consent of Deloitte Touche Tohmatsu.
|
||
Consent of Marcum LLP.
|
Carbon Revolution Public Limited Company
|
|||
November 9, 2023
|
By:
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/s/ Jacob Dingle |
|
Name:
|
Jacob Dingle |
||
Title:
|
Director and Authorized Signatory |