Convertible Redeemable 10% Notes
January 2015
(1)
Gulf Minerals Corporation
Gulf Minerals Corporation Limited is an Australian manganese development group listed on the Australian
Securities Exchange (ASX: GMC) and shall make application to dual list on the Singapore Exchange’s
Catalist Board.
(2)
Proposed business
GMC will develop an alloying smelter facility based in the West Timor capital Kupang, Indonesia to take
full advantage of the following:
(1.1)
(1.2)
(1.3)
(1.4)
Low cost, low impurity high grade manganese ore
Beneficial cost of labour
Modest power cost
Government Fiscal Incentives and 5 year Tax Holiday
Production will be a premium quality 78% manganese alloy resulting from the unique qualities of the
Indonesian ore blended with ore sourced from various Asian locations to produce a medium carbon
ferromanganese alloy.
(3)
Stage of development
To implement the business plan Gulf will complete the following;
(3.1)
(3.2)
(3.3)
(3.4)
(3.5)
(3.6)
Raise funds via Convertible Notes offering – Terms Sheet attached
Finalise engineering design
Finalise Government industrial land in Kupang (West Timor)
Finalise smelter Supply and Construction Contract Agreement
Finalise Offtake Agreements
Listing of GMC on the Singapore Stock Exchange Catalist Board (Q2 2015)
(4)
Business Plan
The business plan contemplates dual function of exporting +50% manganese ore, under government
licence, in 2015 and exporting premium quality ferromanganese alloy from 2016.
Free cashflow is projected to increase from $1.7m in 2015 to $36.8m in 2019.
(5)
Management team
Graham Anderson – Non Executive Chairman
Graham holds a Bachelor of Business and is a Chartered Accountant with more than 25 years
experience of commercial and corporate dealings with national chartered accounting firms in auditing
and independent expert reports. He has extensive experience and knowledge of the ASX listing rules
and the Corporations Act.
Peter Williams – Non Executive Exploration Director
Peter holds a PhD in structural geology and has a wide range of exploration experience in regional
structural geology, particularly within Asia. Before retiring he was Managing Director of SRK Australia,
one of the country’s largest specialist geological consulting groups.
Michael Walters – Non Executive Marketing Director
Michael is an engineer with 30 years experience in the resources industry. Previously he worked with
Billiton, Western Mining and Consolidated Minerals where he was part of the team that built CSM into
the world's 4th largest high-grade manganese supplier. He is principal of his own mineral ore marketing
business.
Bruce Morrin – Executive Technical Director
Bruce is a mining engineer with over 45 years in mining covering open pit and underground operations.
He commenced his career on the Zambian copper belt with Anglo American, was General Manager for
African Associated Mines in Zimbabwe, Registered Mine Manager Mt Isa Copper Operations and
Director of copper and molybdenum mining operations in Western Australia.
Paul O’Shaughnessy – Non Executive Metallurgical Director
Paul is a metallurgical engineer with some 40 years of industry experience which includes smelting
operations producing both bulk and specialty manganese alloys. He operates his own consulting
business, which includes advising on the manufacturing of ferro alloys.
Michael Kiernan – President Director PT Internasional Mangan Grup
Michael has spent 40 years in the mining and transport industries, most notably in the discovery,
development and operations of manganese and iron ore. He previously built a resources group to
become one of the ASX 200 resource companies.
(6)
Funding (pre IPO)
Convertible notes
January 2015
$2,500,000
Use of Funds:
Finalise smelter engineering design and consulting costs
IPO costs for listing on the Singapore Exchange.
(7)
Funding (IPO)
Q3 2015
$15,000,000
(8)
(9)
Project Funding
Convertible Notes
Listing
Project Debt
Project Debt
Capital Raising
$2.5m
$15m
$12.5m
$5m
$25m
Total
$60m
Capital Expenditure
2015 (1H)
2015 (2H)
2016
2017
2018
Total
(10)
2014
2015
2016
2017
2018
$2m
$12.5m
$12.5m
$12.5m
$12.5m
_______
$52m
EBITDA
2015
2016
2017
2018
2019
$1.7m
$9.7m
$18.5m
$27.3m
$36.8m
Engineering and IPO costs
2 Furnaces
2 Furnaces
2 Furnaces
2 Furnaces
GULF MINERALS CORPORATION LIMITED
REDEEMABLE CONVERTIBLE NOTES TERM SHEET
COMPANY OVERVIEW
January 2014
Gulf Minerals Corporation Limited will develop an ASEAN focused manganese alloy producer. The facilities based
in Indonesia will take advantage of low cost of ore, labour and power. Production will be a premium quality 78%
ferro manganese alloy resulting from the unique qualities of the Indonesian high grade low impurities manganese
ore. Value adding ores is strongly encouraged by the Indonesian Government to enrich the country’s minerals
endowment thereby enhancing the economy and creating employment. All initiatives to value add have full support
from all levels of government and GMC will benefit from the Government’s Financial Incentives Programme which
effectively will result in a 5 year tax holiday advantage.
COMPANY DETAILS
Company
Head office:
Shares currently
on issue:
Options currently
on issue:
NOTE DETAILS
Gulf Minerals
Corporation Limited
ACN 059 954 317
ASX: GMC
Level 2
78 Mill Point Road
South Perth, Western
Australia
Issuer:
Notes offered:
Gulf Minerals
Corporation Limited
AUD $2,500,000
Denomination:
AUD $10,000 per note
Term:
3 years
Coupon:
10%
Interest:
Paid quarterly in arrears
Conversion:
85% 30 day VWAP
49,232,676
15,390,671
TERMS AND CONDITIONS

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

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Issuer
Notes offered
Coupon
Term
Interest payments
Denominations
Ranking of Notes
Guarantees

Conversion:

Redemption:

Governing law
Gulf Minerals Corporation Limited (www.gulfmineralscorp.com)
AUD $2,500,000 unsecured
10%
3 years from issue
Quarterly in arrears
250 notes in denomination of AUD $10,000 per note
Will rank senior in obligation of payment to any future indebtedness including dividends
The issuer’s obligations under the Notes will be guaranteed by Gulf Minerals Corporation
Limited and subject to all regulatory approvals
Each note may be converted into Gulf shares at the rate of 85% of the 30 day VWAP at the
Holders option after 12 months from issue
Each note may be redeemed at the Holders option 12 months from issue or any time
thereafter with 3 months notification and all outstanding notes will be redeemed in full 36
months from issue
The Laws of Australia shall apply to the Notes
USE OF FUNDS


Finalise smelter engineering design and consulting costs
Listing costs for GMC listing on the Singapore Stock Exchange (SQX)
SMELTER OVERVIEW



Capital cost of each furnace plus ancillaries $6.5M (total of 8 over 4 years)
Full production 160,000 tonnes alloy and 180,000 tonnes ore per year
Funding via AUD $15M listing of GMC on the Catalist Board of the SQX
The above term sheet has been authorised by the Gulf Minerals Corporation Limited Board of Directors.
Bruce Morrin – Chief Executive Officer
10 November 2014