Ann: Operational and Commercial Update, page-22

With so much time to prepare, I was hoping for a more substantial announcement. But yet again TBA delivers more questions than answers.

1. Following the presale of 200oz in Late November, Byron said:

So what changed, why did the “small portion” become “the majority”. Less material processed? lower grades? Gold loss?

2. They have previously flagged a gold pour each week. Now we have a pour on 12 Feb and the next in March. Why has this changed and why such a large break between gold pours? Is it simply a ploy to produce a large pour prior to trading resuming?

3. What exactly happened to the crusher and where does the liability lie? What is the cost to TBA?

4. TBA states “Based on production modelling forthe operation of the GAM plant, the Company intends to repay the debt facilitythrough the sale of gold produced from the processing of ore stockpiled at theGAM plant.” and “Directors of the Company consider that the projectedcash flows from the restart of gold processing and production will enable it tomeet its operational and corporate commitments, as well as fund the repaymentof the short-term debt facility.”

Where is this production modelling that shows this? Why has it not been provided to shareholders?

5. It is mentioned in the announcement and 3 times in the transaction summary that “The loan contains a number of restrictivecovenants which are typical for a facility of this nature”.

It doesn’t matter how many times you say it, it doesn’t make it true! I would consider many of the terms to be untypical and highly skewed towards an asset transfer outcome.

6. 80%p.a interest rate plus 42.5M options is obscene in anyone’s language. Especially given the first ranking security means risk for the lenders is negligible. For these kinds of returns you would expect an unsecured loan.

7. The logic behind much of section 13 Events of Default is difficult comprehend. They appear to offer substantial benefit to the lender without providing any real reduction in risk.

a. Why are they interested in the operability of the crusher? TBA needs to meet its financial loan obligations, the onsite operations of how this is or isn’t achieved should not be the trigger a default prior to 90 days.

b. Byron Miles ceases to be a director of TBA. This defies all logic. They are lending money to the company, not Byron. So, if Byron gets hits by a bus crossing the street this afternoon, or decides he’s had a gut full and leaves, the lenders take all TBA’s assets. TBA needs to come out and explain who requested this clause, why it was requested and why it was agreed to. Is it legal?

c. “TBA fails to company with or is at any timein breach of any material agreement to which it is a party. This includes theagreements under which TBA acquires the Lorena CIL Plant and the Great AustralianMine CIP plant”. Why is this a default? The lenders should only be worried about being paid and they have top ranking debt anyway, so this shouldn’t concern them.

d. “the hire agreement for the Great AustralianMine CIP plant is terminated or brought to an end before repayment of the Loan”. This is very concerning. The last advice from TBA is the lease ends on 1^st March. TBA need to update sharholders on the status of the lease agreement ASAP and I can’t believe it wasn’t included in this announcement. If GAM decides to end the lease agreement with TBA within 90 days it’s a default. Do the loanand lease durations align or has TBA signed up to a default condition it has nocontrol over?

e. “if TBA sells or refines any Gold, ore or materials other than in accordance with the terms of the Loan Agreement”. Again, why is this a default condition? The lenders should be concerned about getting their money, I don’t see how this affects them.