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Exclusive Option Agreement Terms
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The Company has signed an exclusive option agreement to acquire a 50% interest in the existing underground mining operation and five mining concessions/contracts.
Under the terms of the agreement, the Company has the option to acquire a 50% share in the joint venture company to operate, develop and expand the existing operation and carry out an initial exploration program on the adjacent and near-mine exploration ground. The Company will further assist the joint venture in funding and developing the existing operation. The mine has committed to a staged production expansion using minimal capital expenditure and predominantly involving mechanisation of the existing operations.

The Company has engaged independent legal, technical and financial consultants to complete a detailed due diligence review, that is currently on-going and is forecast to be completed in the current quarter.
A$5 Million Convertible Note Facility

The Company is also pleased to announce that it has finalised a convertible note facility with US based Bergen Global Opportunity Fund LP for up to A$5 million.
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Bergen Global Opportunity Fund, LP is a New York-based investment fund that invests in high growth public and private companies around the world.
The A$5 million facility will be made available to the Company in three tranches, with the first tranche of A$2.5 million already drawn (under its existing 15% capacity) and two subsequent tranches each of A$1.25 million after 30 and 60 days.

The convertible securities are interest free and secured against 6,800,000 shares of the Company. The convertible securities are convertible into the Company’s ordinary shares at 90% of the average of five daily volume-weighted average prices of the Company’s ordinary shares during a specified period prior to the date of their conversion, and with up to A$1.5 million at a conversion price equal to 130% of the average of the daily VWAPs per Share during the 20 trading days immediately prior to the execution date of the agreement. The facility is subject to a floor price of A$0.15, whereby the Company may elect not to issue the convertible notes and to terminate the facility at no cost if the market price of its shares is below the floor price.

A facility fee has been paid by way of the issuance of shares of the Company. The Company has issued 12,500,000 options with an exercise price of $0.2216 and with an expiry date of 16 May 2015 to the investor.
The facility will be used by the Company for general corporate purposes and working capital and to assist in the evaluation of advanced and producing opportunities both in and outside of South Africa.
Please find attached an updated Appendix 3B and Cleansing Notice issued under Section 708A(5)(e) Corporations Act.

Regards
For and on behalf of the Board.