Notes to the Consolidated Financial Statements continued ANNUAL Report June 2023 Notes to the Consolidated Financial Statements 48 mortgage from Mt Carbine Quarries Pty Ltd over mining leases ML4867 and ML4919. This mortgage also includes an interest over “Featherweight Property” which is all other property of Mt Carbine Quarries Pty Ltd other than the mining leases. The mortgage is limited recourse, in that it is limited to the value of the mining leases. The contract liability arrangement for the unincorporated joint venture between Mt Carbine Retreatment Pty Ltd and CRONIMET Australia Pty Ltd (Joint Venture) are as follows: Deed of Cross Security between the Joint Venture parties and Mt Carbine Retreatment Management Pty Ltd (as the manager) which secures the performance of their obligations to each other under the Joint Venture; and General Security Deed from Mt Carbine Quarries Pty Ltd in favour of the Joint Venture parties over all present and after acquired property of Mt Carbine Quarries Pty Ltd including its rights under the Mining Leases. 23. OTHER BORROWINGS 2023 $ 2022 $ Unsecured at amortised cost Principal 1,500,000 1,500,000 Accrued interest 150,618 23,336 1,650,618 1,523,336 A 6-month unsecured loan facility was provided by a related party of the Group, Director and shareholder, Zhui Pei Yeo, at an interest rate of 8% per annum charged on the outstanding loan balance. As announced on 31 July 2023 a secondary Variation Agreement was entered into to extend the repayment date from 31 July 2023 to 31 July 2024, hence its classification as a non-current liability in the Statement of Financial Position. 24. OTHER FINANCIAL LIABILITIES 2023 $ 2022 $ Financial liabilities carried at fair value through profit or loss:1 - Current 1,334,992 - Non-current 11,505,740 - 12,840,732 - Deferred interest:2 Current 34,204 - Non-current 282,181 - 316,385 - Total Financial Liabilities 13,157,117 1 A discounted cash flow method using a discount rate of 5.455% (2021: n/a) was used to capture the net present value of the revenues for the life of mine as determined in the May 2023 Update of the BFS. 2 Deferred interest relates to that portion of the Regal Resources Royalties Fund where actual payments did not satisfy the interest component due to the staged ramp-up of Open Cut operations. These costs will be amortised over the period in which the first stage royalty of $10 million is scheduled to be repaid. The Company entered into a Royalty Funding Package with Regal Resources Royalties Fund with the Group receiving $10 million in two separate tranches. The financing consists of a royalty percentage of 3% with a buy-back option after the recovery of the first stage royalty, $10 million, (and prior to the 7 anniversary of the definitive agreement execution) and a payment of $2.75 million reducing the liability to 1.5% for the life of mine. . 90 EQ Resources Limited Annual Report 2023
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