Ann: Cleansing Statement - Section 708A(12C)(e), page-8

There is a maximum percentage of shares that C/M Capital can hold, being 9.99% of the issued capital.

There is slightly different wording in different parts of past announcements.

My take is that C/M Capital cannot, at any one point in time, hold more than 9.99% of the issued capital.

Therefore, C/M Capital can convert $100,000 of convertible notes, get issued 1,250,000 shares, sell those on market, and then convert another $100,000 (or such other amount as they wish) and keep selling on market as long as at any one point in time, they don't hold not than 9.99%.

Also, if the share price is below 8 cents and C/M Capital do not convert and get to the end of the 24 months expiry period for the notes, MGT cannot force C/M Capital to take shares if they would go above 9.99% (and therefore MGT must come up with the cash to repay the convertible notes or be in default).

C/M Capital will want to get repaid the amount they have lent via the convertible notes. The easiest and quickest way for them to get repaid will be to convert notes in smaller tranches and sell on market. My reading of the latest notice is that C/M Capital can go about doing this and there will be no further announcement about shares issued from convertible notes. Therefore, if my understanding is correct, shareholders will not know whether or not C/M Capital are converting and selling on market.

Happy to be proven wrong on the above, but I can't see the share price going much above 12 cents until C/M Capital have converted their notes into 43M shares and sold them all on market. Therefore, even if a final deal is signed with JFE and or someone else, the market might have to absorb that 43 million shares before seeing any substantial price gain.

And I will repeat a comment from one of my other recent posts, if a finance deal is really complex and difficult to understand, my concern is that it will not end well for shareholders.

The following are references to the 9.99% from different announcements.

From original $7M convertible note announcement on 13 January 2025:


From EGM notice on 31 January 2025





From Cleansing notice 30 June 2025