Ann: Secures $4.55m investment and launches entitlement offer, page-28

I can't really see your interpretation is accurate.

A convertible note (which is one type of convertible interest) is type of investment you can make in a company or unit trust. A convertible note earns interest on the amount you pay to acquire the note until the note's expiry date. I cannot see how that is the case as in this instance there is no interest that I can see applicable to the "Advance Payment Shares"..

For the initial tranche of $4.55 m

6.2 (a)

Overview: Lind and SBC will pre-pay a total of $4,550,000 within five business days (Advance Payment) subject to satisfaction of customary conditions precedent (including confirmation by the Company that it has performed or complied in all material respects with all obligations required to be performed or complied with under the Subscription Agreements),


6.2 (2)
Initial Shares: On receipt of the Advance Payment, the Company will issue to Lind and SBC a total of 25,000,000 shares (which may be applied towards satisfying the Company’s subscription obligations under the Subscription Agreement). If at the expiration of the Term there are Initial Shares that have not been applied against the Advanced Payment Credit via subscription, then Lind and SBC will pay the Company for those outstanding Initial Shares based on a formula set out in the Subscription Agreement.

There is a caveat on the share issues i.e.

6.2 (d) Options: On receipt of the Advance Payment, and subject to the Company obtaining shareholder approval on or before 28 February 2023, the Company will issue to Lind and SBC 21,186,441 options each, with an exercise price of $0.089 per share, which expire 3 years after the date of issue. If the Company has not obtained shareholder approval for the issue of options by 28 February 2023 then in lieu of the options Lind and SBC will not be required to pay for the Initial Shares.

In terms of pricing:

6.2 (e) Purchase Price of Placement Shares: Placement Shares may be issued at two different prices, being:

a. $0.089 per share (Fixed Subscription Price); or
b. 90% of the average of the five lowest daily VWAPs during the 20 days the Company's shares trade on the ASX prior to the date on which the price is to be determined, rounded down to the lowest $0.001 (Variable Subscription Price).
(f) Purchase of Placement Shares: Lind and SBC can subscribe for Placement Shares during the Term, subject to the following conditions:
a. Until 28 February 2023, at the Fixed Subscription Price;

This would seem to be a prudent provision by Lind/SBC as likely this has been negotiated over time and no investor would want to pay substantially over the odds in a CR for a SP range that has fallen well below the price that was being negotiated. I do not think this meets the criteria to classify these shares as a convertible note.

I will acknowledge that clause 6.2 (d) does allow an out of the investment if the options are not issued - this also seems prudent as Lind/SBC are not taking a huge fee for the initial investment ($150,000 presumably USD) and clearly see upside in the 8.9c options. I can't imagine that the issuance of the options will not occur.

Perhaps I am totally missing something which has led you to the conclusion that the shares ranking equally with all other issued ordinary shares subject only to 6.2(d) which I do not believe could result in a classification of the shares as even some form of hybrid convertible security - the Variable price conditions 6.2(e) also I do not interpret as any reason to deem the Advance Payment shares as a form of convertible note.