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ACN 107 045 983
PROSPECTUS
For the offer of 25,000,000 Shares at an issue price of $0.20 each to raise a total of
$5,000,000
IMPORTANT INFORMATION
This is an important document that should be read in its entirety. If you do not understand it
you should consult your professional advisers without delay. The Shares offered by this
Prospectus should be considered speculative.
THIS OFFER IS NOT UNDERWRITTEN
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Contents
CORPORATE DIRECTORY ......................................................................................................................... 3
IMPORTANT NOTICE ............................................................................................................................... 4
INVESTMENT OVERVIEW ........................................................................................................................ 6
CHAIRMAN’S LETTER ............................................................................................................................. 20
1. DETAILS OF THE OFFER ................................................................................................................. 22
2. COMPANY & PROJECT OVERVIEW ................................................................................................ 25
3. RISK FACTORS ................................................................................................................................ 33
4. INDEPENDENT GEOLOGIST'S REPORT ........................................................................................... 40
5. FINANCIAL INFORMATION ............................................................................................................ 88
6. INVESTIGATING ACCOUNTANT’S REPORT .................................................................................... 90
7. SOLICITOR’S REPORT ON TENEMENTS ........................................................................................ 102
8. MATERIAL CONTRACTS ............................................................................................................... 119
9. CORPORATE GOVERNANCE......................................................................................................... 123
10. ADDITIONAL INFORMATION ................................................................................................... 129
11. DIRECTORS’ AUTHORISATION ................................................................................................. 137
12. GLOSSARY ................................................................................................................................ 138
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CORPORATE DIRECTORY
Directors
Stephan Meyer – Non-Executive Chairman
Roland Hill – Executive Director
Andrew Spinks – Non-Executive Director
Brad Farrell – Non-Executive Director
Company Secretary
Robert Hodby
Registered Office
338 Hay Street
Subiaco WA 6008
Telephone: +61 8 9388 6069
Facsimile: +61 8 6380 1026
Website
http://www.tabora.com.au
Share Registry*
Computershare Investor Services Pty Limited
Level 2, Reserve Bank Building
45 St Georges Terrace
Perth WA 6000
Investor enquiries: 1300 850 505
Telephone: +61 8 9323 2000
Facsimile: +61 8 9323 2033
* These entities are included for information
purposes only and have not been involved in
the preparation of this Prospectus.
Independent Geologist
AL MAYNARD & ASSOCIATES Pty Ltd
9/280 Hay Street
SUBIACO WA 6008
Solicitors – Australia
Steinepreis Paganin
Lawyers and Consultants
Level 4, The Read Buildings
16 Milligan Street
PERTH WA 6000
Solicitors – Tanzania
Ishengoma, Karume, Masha & Magai
Advocates
IMMMA House, Plot No. 357,
United Nations Road , Upanga,
PO Box 72484
Dar es Salaam , Tanzania
Investigating Accountant
Stantons International Pty Ltd trading as
Stantons International Securities
Level 2, 1 Walker Avenue
West Perth WA 6005
Auditor*
Stantons International Audit and Consulting
Pty Ltd trading as Stantons International
Level 2, 1 Walker Avenue
West Perth WA 6005
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IMPORTANT NOTICE
This Prospectus is dated 23 January 2012 and was lodged with the ASIC on that date. The ASIC and
its officers take no responsibility for the contents of this Prospectus or the merits of the investment
to which the Prospectus relates.
The expiry date of this Prospectus is at 5.00pm WST on that date which is 13 months after the date
this Prospectus was lodged with the ASIC (Expiry Date). No Shares may be issued on the basis of this
Prospectus after the Expiry Date.
No person is authorised to give information or to make any representation in connection with this
Prospectus, which is not contained in the Prospectus. Any information or representation not so
contained may not be relied on as having been authorised by the Company in connection with this
Prospectus.
It is important that investors read this Prospectus in its entirety and seek professional advice where
necessary. The Shares the subject of this Prospectus should be considered speculative.
WEB SITE – ELECTRONIC PROSPECTUS
A copy of this Prospectus can be downloaded from the website of the Company at
http://www.tabora.com.au. Any person accessing the electronic version of this Prospectus for the
purpose of making an investment in the Company must be an Australian resident and must only
access the Prospectus from within Australia.
The Corporations Act prohibits any person passing onto another person an Application Form unless
it is attached to a hard copy of this Prospectus or it accompanies the complete and unaltered version
of this Prospectus. Any person may obtain a hard copy of this Prospectus free of charge by
contacting the Company.
The Company reserves the right not to accept an Application Form from a person if it has reason to
believe that when that person was given access to the electronic Application Form, it was not
provided together with the electronic Prospectus and any relevant supplementary or replacement
prospectus or any of those documents were incomplete or altered.
EXPOSURE PERIOD
This Prospectus will be circulated during the Exposure Period. The purpose of the Exposure Period is
to enable this Prospectus to be examined by market participants prior to the raising of funds.
Potential investors should be aware that this examination may result in the identification of
deficiencies in the Prospectus and, in those circumstances, any application that has been received
may need to be dealt with in accordance with Section 724 of the Corporations Act.
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Applications for Shares under this Prospectus will not be processed by the Company until after the
expiry of the Exposure Period. No preference will be conferred on persons who lodge applications
prior to the expiry of the Exposure Period.
PHOTOGRAPHS
Any photographs in this Prospectus, except where indicated, are not necessarily of assets owned by
the Company, but have been included to give an indication of the nature and or location of the
Company's business, operations and industry in which it operates.
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INVESTMENT OVERVIEW
This Section is a summary only and not intended to provide full information for investors intending
to apply for Shares offered pursuant to this Prospectus. This Prospectus should be read and
considered in its entirety.
BUSINESS MODEL
An investment in Tabora represents an exciting opportunity to participate in exploration within the
mineral rich country of Tanzania, East Africa.
Objectives
The primary objective of Tabora is to build its future on its Tanzanian assets and develop a rare earth
elements (REE) company, however, some of the exploration properties in which Tabora has an
interest also have significant diamond potential.
In addition, the Company will review other acquisition and joint venture opportunities to secure new
projects in the resources sector that are considered by the Directors to meet the Company’s
objectives and strategies.
Projects and mining information
The Company has an interest in three exploration projects which are considered to be highly
prospective for the occurrence of REE mineralisation:
• Nzega Project (100% of the mineral rights excluding gold)
o This acquisition remains conditional on the Company raising $5m and achieving
admission to the official list of ASX by 21 April 2012.
• Mbeya Project (100% beneficially owned)
• Mwanga Project (100% beneficially owned)
The combined ground holding of Tabora’s three projects is approximately 753km2 and is considered
under-explored for REE mineralisation.
The Company has extensive exploration experience in Tanzania through its past diamond exploration
programs. It holds significant geological and technical datasets for Tanzania and East Africa. This
includes diamond exploration data that have been accumulated over 40 years and that are relevant
for REE exploration. In addition, through its agreement and alliance with Resolute Mining Limited, it
has access to its geological datasets and will benefit from that entity’s 15+ years in-country
experience. The alliance with Resolute Mining Limited provides an outstanding platform not only to
operate in Tanzania but to also seek new opportunities in other parts of East Africa.
A summary of the agreement relating to each of the Projects is contained in Section 5 of this
Prospectus.
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A summary of the Company and each of the Projects is set out in Section 2 of this Prospectus and
more detailed information is included in the Independent Geologist’s Report in Section 4 of this
Prospectus.
Plans
Exploration on the Projects is planned to begin immediately following the Company’s admission to
the official list of ASX.
The Company’s ability to generate revenue in the future will depend upon the success of the
Company’s exploration activities on its current tenure and the Company’s ability to successfully
exploit any minerals that may be discovered on these tenements.
More detailed information on the proposed exploration on the Projects is included in the
Independent Geologist’s Report in Section 4 of this Prospectus.
KEY RISKS
The business, assets and operations of the Company are subject to certain risk factors that have the
potential to influence the operating and financial performance of the Company in the future. These
risks can impact on the value of an investment in the securities of the Company.
The Company aims to manage these risks by carefully planning its activities and implementing risk
control measures. Some of the risks are, however, highly unpredictable and the extent to which the
Company can effectively manage them is limited.
Set out below are specific risks that the Company is exposed to.
These risk factors ought not to be taken as exhaustive of the risks faced by our Company and you
should refer to the additional risk factors in Section 3 of this Prospectus before deciding whether to
apply for Shares pursuant to this Prospectus.
Title – mineral rights only (Nzega Project) & beneficial interest only (Mbeya & Mwanga Projects)
The Company does not have a registered interest in any of the Tenements. It only has an equitable
interest in the mineral rights (excluding gold) on the Nzega Project and an equitable interest in the
Mbeya and Mwanga Projects as beneficial owner of those tenements.
Until such time as legal title is transferred to the Company, the only right available to the Company
to protect its interest is registration of the respective agreements creating the Company’s interest
with the Ministry for Energy and Minerals, Tanzania. Such a registration prevents the registration of
any transfer or mortgage over the Tenements without first giving notice to the Company.
As at the date of this Prospectus, the Company has not yet registered the agreements creating the
Company’s interest with the Ministry for Energy and Minerals, Tanzania.
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It is the Company’s intention to complete the registration process for the Tenements comprising the
Mbeya Project and Mwanga Project prior to the Closing Date either by registering the relevant
agreement or transferring title to a wholly owned subsidiary to be incorporated in Tanzania. As the
Company’s interest in the Nzega Project has not yet been acquired and remains conditional upon
being admitted to the official list of ASX it is the Company’s intention to complete this registration
process at the time of settlement of that acquisition.
Title – renewal
The grant or renewal of a Tenement is subject to the approval of the Ministry for Energy and
Minerals, Tanzania. If a Tenement is not granted or renewed, the Company may suffer significant
damage through the loss of opportunity to develop and discover mineral deposits on that Tenement.
It is noted the expiry date of the initial term of PL5613/2008 and PLR6100/2009 has passed. Each of
these Tenements has had an application for renewal submitted but not yet approved. The
Tenements remain in force until the application for renewal is determined. As the renewal process
has been complied with by the holder it is noted in the Solicitor’s Report on Tenements included in
Section 0 of this Prospectus that there is no legal reason why the renewals would not be approved.
On this basis the Company does not believe there is a risk that the renewals will not be approved.
Title – other matters
A holder of a prospecting licence (the category of each of the Tenements) may be served with notice
of termination of that prospecting licence where a valid application for a Special Mining Licence or
Mining Licence has been lodged to the Ministry for Energy and Minerals, Tanzania. During the
notice period the holder of the prospecting licence has the right to apply for a Special Mining Licence
or Mining Licence. These two applications will be evaluated on equal priority and granted in
accordance with a tender process. The existing holder of a prospecting licence only has priority
where its application for another type of licence is made prior to another applicant. As a Special
Mining Licence and Mining Licence relates to large scale mining operations whose capital investment
is in excess of USD100 million and USD100,000 respectively the Company does not believe there is a
risk of such an application being made prior to an equivalent application of the holder of the
Tenements should such an application be warranted in the future.
As noted in the Solicitor’s Report on Tenements included in Section 0 of this Prospectus annual rent
on PL 6243/2009 is overdue. The non-payment of rent does not affect the title to the tenements or
the ability to renew a tenement for a further term rather a fine is imposed equal to 25% of the rent
payable for individual tenement holders or 50% of the rent payable for body corporate tenement
holders.
While the Company has investigated the title to the exploration or prospecting permits or licenses in
which it has an interest, the Company cannot guarantee that interest in such permits or licenses, or
its right to explore and develop the properties covered by such permits or licences will not be
challenged or impugned by third parties.
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An impairment to or defect in the Company’s title to any of its properties could have a material
adverse effect on the Company’s business, financial condition or results of operations. In addition,
such claims, whether or not valid, will involve additional costs and expenses to defend or settle
which could adversely affect the Company’s profitability.
Contractual risk
In order for the Company to be able to achieve its objectives the Company is reliant on the
registered holder of the Tenements to comply with its contractual obligations under the respective
agreements with respect to maintaining the Tenements in full force and effect, free from any liability
to forfeiture or non-renewal.
Where the registered holder of the Tenements fails to comply with conditions of the Tenements
which results in loss of title to the Tenements the Company would lose its interest in, the minerals
rights being acquired in the Nzega Project or all rights acquired in the Mbeya Project and Mwanga
Project (until such time as title to the Tenements comprising the Mbeya Project and Mwanga Project
are transferred to the Company or a subsidiary at which point there is no longer a contractual risk).
It may then be necessary for the Company to approach a court to seek a legal remedy. Legal action
can be costly and there can be no guarantee that a legal remedy will be ultimately granted on the
appropriate terms.
In respect of prospecting licence PL3962/2006, the vendors of the Resolute Agreement only hold the
beneficial interest as this tenement remains registered in the name of the previous vendor until the
transfer of title is registered by the Ministry for Energy and Minerals, Tanzania. As noted in
paragraph 5.1.5 of the Solicitors Report on Tenements set out in Section 0 of this Prospectus, the
transfer of this prospecting licence does not need the consent of the Minister. The vendors of the
Resolute Agreement have warranted that they are entitled to be the registered holder of this
tenement and have full authority to sell the mineral rights being acquired by the Company.
The Company has no current reason to believe that the holder of the Tenements that it has
contracted with will not meet and satisfy its obligations under the respective agreements.
Co-existence – Nzega Project
Pursuant to the terms and conditions of the agreement relating to the Nzega Project, the Company
has contractual rights and obligations in relation to the co-existence, exploration and potentially
mining on the Tenements. In the event that the parties wish to conduct exploration activities on the
same target area, the parties must use all reasonable endeavours to accommodate the planned
exploration of the other party.
If one or more feasibility studies prepared by a competent person (as defined in the ASX Listing
Rules) identifies either an ore body on one or more of the Resolute Tenements which contains both
economically recoverable quantities of gold and non-gold minerals, or, two or more ore bodies, one
of which contains an economically recoverable quantity of gold and the other an economically
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recoverable quantity of non-gold minerals, but both ore bodies cannot be simultaneously mined, the
Company and the registered holder must negotiate in good faith for 3 months to agree the most
economic method by which both minerals can be mined. In the absence of agreement the
registered holder has priority.
There is a risk that the Company may not be able to complete all of its preferred exploration
programmes in its preferred timetable or at all, as a result of a conflict with the exploration activities
and subsequently mining activities of the registered holder of those tenements.
Exploration success
The Company does not presently have any JORC Code compliant resources on the tenements in
which it is earning an interest. Potential investors should understand that mineral exploration and
project development are high-risk undertakings. There can be no assurance that exploration of
these tenements, or any other tenements that may be acquired in the future, will result in the
discovery of an economic ore deposit. Even if an apparently viable deposit is identified, there is no
guarantee that it can be economically exploited. Until the Company is able to realise value from its
Projects, it is likely to incur ongoing operating losses.
THE OFFER
Summary of the Offer
By this Prospectus, the Company invites investors to apply for 25,000,000 Shares at an issue price of
$0.20 each to raise $5,000,000.
Indicative Timetable
Event Indicative Date
Lodgement of Prospectus with the ASIC 23 January 2012
Opening Date 1 February 2012
Closing Date (5.00pm WST) 30 March 2012
Despatch of Holding Statements 5 April 2012
Expected date for quotation on ASX 13 April 2012
The above timetable is indicative only and the Directors may have to alter the timetable as necessary
or required by ASIC or ASX. The Company reserves the right to extend the Closing Date or close the
Offer early without notice.
Purpose of the Offer
The purpose of this Offer is to facilitate an application by the Company for admission of the
Company to the official list of ASX position the Company to seek to achieve the objectives set out
above.
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Use of Funds
The Company intends to apply funds raised from the Offer, together with existing cash reserves,
over the first two years following admission of the Company to the official list of ASX as follows:
Funds available Minimum/Full Subscription
Existing cash reserves1 $241,676
Funds raised from the Offer $5,000,000
Total Funds Available $5,241,676
Notes:
1 Refer to the Investigating Accountant’s Report set out in Section 5 of this Prospectus for further details.
Changes to the cash assets figure since 30 September 2011 have related to part payments of some expenses of
the Offer.
2 Refer to Section 10.6 of this Prospectus for further details.
3 Refer to the material contract summary set out in Section 8.2 of this Prospectus for further details. In the
event the Convertible Note is converted rather than redeemed this amount will become working capital and
applied by the Company to additional exploration expenditure if warranted at the relevant time.
4 Refer to the Independent Geologist’s Report in Section 4 of this Prospectus for further information on the
planned exploration activities and expenditure budget for the Projects.
5 The amount allocated to administration costs in year one will be applied primarily to remuneration of
Directors and the Company’s Chief Financial Officer (including salaries and fees which accrued from 13 June
2011 (or 5 August 2011 in respect of Brad Farrell) until 31 December 2011) of approximately $770,000, as well
as repayment of creditors of the Company as at 30 September 2011 of approximately $93,000 and
subsequently general operating costs including rent, insurance, utilities, listing fees and adviser fees. The
amount allocated to administration costs in year two is lower as the accrued salaries and fees and repayment
of creditors will no longer be applicable.
On completion of the Offer, the Board believes the Company will have sufficient capital to achieve
these objectives.
The above table is a statement of current intentions as of the date of this Prospectus. As with any
budget, intervening events (including exploration success or failure) and new circumstances have the
potential to affect the ultimate way funds will be applied. The Board reserves the right to alter the
way funds are applied on this basis.
Allocation of funds Year One
($)
Year One
(%)
Year Two
($)
Year Two
(%)
Expenses of the Offer2 476,379 9.09 NIL NIL
Redemption of Convertible Note3 274,316 5.23 NIL NIL
Exploration – Rare Earth Elements4 1,200,000 22.89 1,450,000 27.66
Exploration – Diamonds4 100,000 1.91 150,000 2.86
Administration costs5 976,135 18.62 614,846 11.73
Total 3,026,830 57.75 2,214,846 42.25
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Capital Structure1
The capital structure of the Company following completion of the Offer is summarised below2:
Shares3
Number
Shares on issue at date of Prospectus4 35,405,990
Shares to be issued to Resolute (Treasury) Pty Ltd5 (or nominee) 13,729,917
Shares to be issued pursuant to the Offer 25,000,000
Total Shares on issue at completion of the Offer 74,135,907
Options
The Company does not have any options on issue.
Convertible Note6
Pursuant to the Convertible Note Deed, the Company is to issue a Convertible Note to Resolute
(Treasury) Pty Ltd as part consideration under the Resolute Agreement.
The Convertible Note will have a principal of $274,316 and a conversion price of $0.20 which in the
event of conversion would result in a further 1,371,580 Shares being issued.
Notes:
1 The capital structure on a fully diluted basis on completion of the Offer (assuming all Shares offered under the Prospectus
are issued) would be 75,507,487 Shares.
2 Refer to the Investigating Accountant’s Report set out in Section 5 of this Prospectus for further details.
3 The rights attaching to the Shares are summarised in Section 10.2 of this Prospectus.
4 Shares issued prior to September 2009 were used to fund diamond exploration in the Company’s various joint ventures
which have subsequently been discontinued. Each of these prior issues occurred at an issue price greater than the price
per Share under the Offer. Shares issued subsequent to September 2009 were issued at a discount to the issue price of the
Shares offered pursuant to the Offer to reflect the increased risk associated with an investment in the Company at the time
of issue of the seed capital.
5 A wholly owned subsidiary of Resolute Mining Limited.
6 The material terms of the Convertible Note Deed and Convertible Note are set out in Section 8.2 of this Prospectus.
Substantial holders
Those persons or entities holding a relevant interest in 5% or more of the Shares on issue both as at
the date of this Prospectus and on completion of the Offer (assuming full subscription) are set out in
the respective tables below.
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As at the date of the Prospectus
Substantial holder Shares %
Andrew Spinks1 5,341,976 15.09
Indi Holdings Pty Ltd1 4,982,009 14.07
Robert Hodby1 4,732,196 13.37
Brad Farrell1 3,000,000 8.47
Mohammad Munshi 2,153,925 6.08
1 This relevant interest is held through associated entities.
On completion of the Offer (assuming no existing substantial holder subscribes and receives
additional Shares (or a relevant interest in additional Shares) pursuant to the Offer)
Substantial holder Shares %
Resolute Mining Limited1 14,827,181 20.00
Andrew Spinks2 5,341,976 7.21
Indi Holdings Pty Ltd2 4,982,009 6.72
Robert Hodby2 4,732,196 6.38
1 This relevant interest is to be held indirectly through wholly owned subsidiaries of Resolute Mining Limited.
2 This relevant interest is held through associated entities.
The Company will announce to the ASX details of its top-20 Shareholders (following completion of
the Offer) prior to the Shares commencing trading on ASX.
Restricted securities
Subject to the Company being admitted to the Official List, certain of the securities on issue prior to
the Offer may be classified by the ASX as restricted securities and will be required to be held in
escrow for up to 24 months from the date of Official Quotation as prescribed by the ASX.
It is estimated that a total of 41,173,714 Shares and the Convertible Note will be subject to escrow
as follows:
- 27,293,797 Shares for 24 months from the date of official quotation (primarily held by
directors and their associated entities and substantial holders);
- 13,729,917 Shares and the Convertible Note (and any Shares issued on conversion) for 12
months from their date of issue (being the Shares to be issued to Resolute Mining Limited
(or its nominee) pursuant to the Resolute Agreement); and
- 150,000 Shares for 12 months from their date of issue (being 13 June 2011).
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During the period in which these securities are prohibited from being transferred, trading in Shares
may be less liquid which may impact on the ability of a Shareholder to dispose of his or her Shares in
a timely manner.
The Company will announce to the ASX full details (quantity and duration) of the securities required
to be held in escrow prior to the Shares commencing trading on ASX.
FINANCIAL INFORMATION
The historical financial information of the Company for the three most recent financial years is set
out in Section 5 of this Prospectus.
The audit report on the financial report for each on the financial years ended 30 June in 2009, 2010
and 2011 noted that the ability of the company to continue as a going concern is subject to the
successful recapitalisation of the company by way of a capital raising and/or the sale of the
company's investments and/or mineral tenement interests at sufficient amounts so the company
can meet its existing and future commitments and proposed expenditures.
Past financial performance is not a guide to future performance.
Taxation
The acquisition and disposal of Shares will have tax consequences, which will differ depending on
the individual financial affairs of each investor. All potential investors in the Company are urged to
obtain independent financial advice about the consequences of acquiring Shares from a taxation
viewpoint and generally.
To the maximum extent permitted by law, the Company, its officers and each of their respective
advisors accept no liability and responsibility with respect to the taxation consequences of
subscribing for Shares under this Prospectus.
Dividend policy
The Company anticipates that significant expenditure will be incurred in the evaluation and
development of the Company’s projects. These activities, together with the possible acquisition of
interests in other projects, are expected to dominate the two year period following the date of this
Prospectus. Accordingly, the Company does not expect to declare any dividends during that period.
Any future determination as to the payment of dividends by the Company will be at the discretion of
the Directors and will depend on the availability of distributable earnings and operating results and
financial condition of the Company, future capital requirements and general business and other
factors considered relevant by the Directors. No assurance in relation to the payment of dividends
or franking credits attaching to dividends can be given by the Company.
DIRECTORS & MANAGEMENT
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Dr Stephan Meyer – Non-executive Chairman
Stephan Meyer is a geologist with over 40 years of international experience in the resource industry,
including more than 20 years involvement in diamond exploration in Australia, China, Russia, Canada
and Brazil. Dr Meyer as Chairman is responsible for organising and coordinating the board's activities
and reviewing and evaluating the performance of the CEO and the other board members. His
experience will also be invaluable in the development of the Company’s strategy.
Dr Meyer acted as chief geologist for Rio Tinto Limited (formerly CRA Limited). Dr Meyer sat on the
board of directors of Tahera Corporation, a Canadian diamond producer, from 2001 to 2003. He is
currently a non-executive director of Majestic Diamonds & Metals, a private US based company with
extensive exploration interests in Brazil. As a co-founder of Tabora, Dr Meyer has been a Director
since its inception in 2003. Dr Meyer holds a PhD in geology from University of Zurich.
Dr Meyer does not expect that his directorships with other companies or other business activities
will interfere with his ability to act as a Non-Executive Director to the Company
Mr Roland Hill – Executive Director
Roland Hill has over 25 years in the resource industry and has significant investment, finance and
funds management experience. Mr Hill is responsible for the implementation of corporate strategy
and day to day management of the Company.
Mr Hill is currently a Non-executive Director of Crescent Gold Limited.
Mr Hill does not expect that his directorships with other companies or other business activities will
interfere with his ability to act as an Executive Director to the Company
Dr Brad Farrell – Non-executive Director
Dr Brad Farrell has 43 years experience in the worldwide exploration and evaluation of a variety of
commodities and has managed numerous and extensive exploration programs for both junior and
major companies which have resulted in discoveries that are currently in production. He has also
been involved in the corporate management of listings on the ASX.
Dr Farrell holds a Bachelor of Science (Honours - Economic Geology) from the University of Adelaide
and a Master of Science and Doctor of Philosophy from the University of Leicester. He is a Fellow of
the Australian Institute of Mining and Metallurgy, a Chartered Professional Geologist of that
organization, a Member of the Mineral Industry Consultants Association, a Member of the Institute
of Materials, Minerals and Mining, a Chartered Engineer of that organisation and a Member of the
Petroleum Exploration Society of Australia.
Dr Farrell was recently a director in Sun Resources NL (ceased February 2011) and is currently a non-
executive director of Ezenet Limited
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Dr Farrell does not expect that his directorships with other companies or other business activities
will interfere with his ability to act as an Executive Director to the Company.
Mr Andrew Peter Spinks – Non Executive Director
Andrew Spinks is a geologist with over 20 years professional experience in nickel, gold, coal, iron ore
and diamonds in Australia and Africa. As a Non-executive Director Mr Spinks is responsible for
oversight of the governance process including contribution to the development of corporate
strategy and the monitoring of the executive activity.
Mr Spinks is currently a director of Central Iron Ore Limited and Rarus Limited.
Mr Spinks does not expect that his directorships with other companies or other business activities
will interfere with his ability to act as an Executive Director to the Company.
Mr Robert Wellesley Hodby – Company Secretary
As Company Secretary, Mr Hodby’s responsibilities will include, but are not limited to, the following:
(a) liaising with ASX in relation to the Company’s activities;
(b) facilitating the implementation of Board policies and procedures; and
(c) advising the Board on corporate governance matters, the application of the Company’s
Constitution, the ASX Listing Rules and other applicable laws.
Mr Hodby holds a Bachelor of Commerce from Murdoch University and is a member of CPA Australia
and Chartered Secretaries Australia. Robert provides corporate, management and accounting advice
to a number of companies involved in the resource and energy industries.
Robert is the Company Secretary of Torrens Energy Limited and of NeuroDiscovery Limited and a
Non-Executive Director of Robe Australia Limited.
Disclosure regarding directorships of insolvent companies
Mr Hill is a director of the following companies that are currently under external administration:
Compass Hotel Group Limited (formerly listed on ASX under code CXH) and its wholly owned
subsidiaries Albion Hotel (WA) Pty Ltd, Belmont Tavern (WA) Pty Ltd, Brighton Hotel (WA) Pty Ltd,
Carine Glades Tavern (WA) Pty Ltd, Cobblers Tavern (WA) Pty Ltd, Compass Hotel Group Operations
(WA) Pty Ltd, Gosnells Hotel (WA) Pty Ltd, Greenwood Hotel (WA) Pty Ltd, Herdsman Lake Tavern
(WA) Pty Ltd, Kalamunda Hotel (WA) Pty Ltd, Lakers Tavern (WA) Pty Ltd, Peel Alehouse (WA) Pty
Ltd, Peninsula Tavern (WA) Pty Ltd and Princess Road Tavern (WA) Pty Ltd.
These companies were placed into administration, not on the grounds of insolvency (as the
individual hotels were all EBITDA positive), but as a result of the funding party revaluing the
underling properties. This led to an adjustment in the loan to value ratio that was outside the loan
covenants and as a result the funding party appointed an external administrator.
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The Directors (other than Mr Hill) have considered the circumstances surrounding Mr Hill’s
involvement in these companies and are of the view that Mr Hill’s involvement with these
companies in no way impacts on his appointment and contribution as a director of the Company.
Management and Consultants
The Company is aware of the need to have sufficient management to properly supervise the
exploration and (if successful) for the development of the projects in which the Company has, or will
in the future have, an interest and the Board will continually monitor the management roles in the
Company. As the Company’s projects require an increased level of involvement the Board will look
to appoint additional management and/or consultants when and where appropriate to ensure
proper management of the Company’s projects.
Corporate governance
To the extent applicable, in light of the Company’s size and nature, the Company has adopted The
Corporate Governance Principles and Recommendations with 2010 Amendments (2nd Edition) as
published by ASX Corporate Governance Council (Recommendations).
The Company’s main corporate governance policies and practices as at the date of this Prospectus
are outlined in Section 9 of this Prospectus and the Company’s departures from the
Recommendations are set out in Section 9.3 of this Prospectus.
In addition, the Company’s full Corporate Governance Plan is available from the Company’s website
(http://www.tabora.com.au).
Disclosure of interests
No cash remuneration has been paid to Directors since December 2007.
Accrued remuneration since that time up to 13 June 2011 has been paid by way of issue of Shares.
These amounts are as disclosed in the Company’s audited annual accounts.
Remuneration will accrue from 13 June 2011 (for Messrs Meyer, Hill and Spinks) and 5 August 2011
(for Brad Farrell) until 31 December 2011 but remain unpaid until such time as the Company is
admitted to the Official List. No remuneration will accrue between 1 January 2012 and the date the
Company is admitted to the Official List.
For each of the Directors, the proposed annual remuneration, including statutory employer
superannuation contributions, from the accrual date and for the first year following the Company’s
admission to the Official List, together with the relevant interest of each of the Directors in the
securities of the Company as at the date of this Prospectus is set out in the table below.
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Director Salary/Fees Superannuation Shares
Dr Stephan Meyer $54,500 $4,500 1,495,040
Roland Hill $196,200 $16,200 1,118,204
Dr Brad Farrell $43,600 $3,600 3,000,000
Andrew Spinks $43,600 $3,600 5,341,976
Agreements with Directors or related parties & other management
The Company’s policy in respect of related party arrangements is:
(a) a Director with a material personal interest in a matter is required to give notice to the
other Directors before such a matter is considered by the Board; and
(b) for the Board to consider such a matter, the Director who has a material personal
interest is not present while the matter is being considered at the meeting and does not
vote on the matter.
Executive services agreement – Roland Hill
The Company has entered into an executive services agreement with Roland Hill (Services
Agreement) effective on and from 13 June 2011. Under the Services Agreement, Mr Hill is engaged
by the Company to provide services to the Company in the capacity of Managing Director on a full-
time basis. Mr Hill will be paid an annual remuneration of $180,000 plus statutory superannuation.
Remuneration will accrue from 13 June 2011 until 31 December 2011 but remain unpaid until such
time as the Company is admitted to the Official List and no remuneration will accrue or be paid
between 1 January 2012 and the date the Company is admitted to the Official List. Following the
Company’s admission to the Official List remuneration will be paid calendar monthly. Mr Hill will
also be reimbursed for reasonable expenses incurred in carrying out his duties.
The Services Agreement continues for a period of 3 years unless terminated in accordance with its
terms. The Services Agreement contains standard termination provisions under which the Company
must give 3 months notice of termination (or shorter period in the event of a material breach), or
alternatively, payment in lieu of service. In addition, Mr Hill is entitled to all unpaid remuneration
and entitlements up to the date of termination.
Employment agreement – Robert Hodby
The Company has entered into an executive services agreement with Robert Hodby (Employment
Agreement) effective on and from 13 June 2011. Under the Employment Agreement, Mr Hodby is
engaged by the Company to provide services to the Company in the capacity of Chief Financial
Officer and Company Secretary on a full-time basis. Mr Hodby will be paid an annual remuneration
of $150,000 plus statutory superannuation. Remuneration will accrue from 13 June 2011 until 31
December 2011 but remain unpaid until such time as the Company is admitted to the Official List
and no remuneration will accrue or be paid between 1 January 2012 and the date the Company is
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admitted to the Official List. Following the Company’s admission to the Official List remuneration
will be paid calendar monthly. Mr Hodby will also be reimbursed for reasonable expenses incurred
in carrying out his duties.
The Employment Agreement continues for a period of 3 years unless terminated in accordance with
its terms. The Employment Agreement contains standard termination provisions under which the
Company must give 3 months notice of termination (or shorter period in the event of a material
breach), or alternatively, payment in lieu of service. In addition, Mr Hodby is entitled to all unpaid
remuneration and entitlements up to the date of termination.
Loans from Directors
The Company has borrowed $5,000 from each of Stephan Meyer and Andrew Spinks to fund
operating expenses. The loans are interest free and to be repaid upon the Company being admitted
to the official list of ASX. The Directors not a party to the loans considered the borrowing to be on
arm’s length terms and consequently Shareholder approval was not required.
Amounts payable to Strategic Resource Management Pty Ltd
Operating expenses totalling $30,164 have been paid by Strategic Resource Management Pty Ltd on
behalf of the Company. This amount is to be repaid upon the Company being admitted to the
official list of ASX.
Strategic Resource Management Pty Ltd (SRM) is a company in which Andrew Spinks, a Director, has
a 50% interest. There is no interest payable on the outstanding amount. The Directors (other than
Andrew Spinks who has a material personal interest in this matter) considered the accumulated debt
to be on arm’s length terms and consequently Shareholder approval was not required.
Deeds of indemnity, insurance and access
The Company has entered into a deed of indemnity, insurance and access with each of its Directors.
Under these deeds, the Company agrees to indemnify each officer to the extent permitted by the
Corporations Act against any liability arising as a result of the officer acting as an officer of the
Company. The Company is also required to maintain insurance policies for the benefit of the
relevant officer and must also allow the officers to inspect board papers in certain circumstances.
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CHAIRMAN’S LETTER
Dear Investor
On behalf of the Board of Directors I am pleased to present this Prospectus to you and to invite you
to become a Shareholder in Tabora Limited.
Tabora Limited, previously known as Redox Diamonds Limited, has its main focus on exploration and
mining of rare earth elements in Tanzania. Redox Diamonds conducted significant exploration for
diamonds in Tanzania in 2006 and 2007 under a joint venture agreement with Resolute Mining
Limited (Resolute).
Rare earth elements are critical constituents of many advanced high technology materials and are
expected to play an ever increasing role in the years to come. Currently, China is producing
approximately 95% of rare earth elements consumed globally. With the recent decision of the
Chinese government to reduce the export quota of these minerals there is growing pressure on
demand resulting in significant price increases in the last 12 months and pressure to satisfy the
global demand for rare earth elements.
Tabora re-negotiated the agreement with Resolute and formed a strong alliance with the company
which has an important gold mining operation in Tanzania. Under the agreement Tabora secured the
right to acquire a 100% interest in the mineral rights (excluding gold) on groups of tenements held
by Resolute covering a total area of 479 square kilometres.
More than 21 carbonatites, the geological host of many economic rare earth elements deposits, are
known to occur in the country, some of which contain significant economic grade of rare earth
elements. During its diamond exploration programs in 2006 and 2007 Resolute and the Company
jointly funded significant aerial geophysical surveys which delineated numerous drill-ready
exploration targets for both kimberlites (host to diamond deposits) and carbonatites which are the
geological host to many major economic rare earth elements deposits.
Tabora’s immediate plans for diamond exploration are low-key investigations of untested drilling
material from kimberlite discovered by the Company in the past. A number of high priority
kimberlite targets remain untested and can be drilled on short notice. It is worth noting that the
diamond market and diamond prices have strengthened substantially in the last 18 months, and
Tabora’s diamond targets add considerable value to the Company’s project portfolio.
In addition to the tenements held as part of the alliance with Resolute, Tabora has acquired from
Tanzanian prospectors a 100% beneficial interest in three tenements that are considered to be
highly prospective for rare earth elements. Two tenements are located in the area of the Mbeya
carbonatite field in Southern Tanzania that contains a large low grade rare earth elements deposit
and one tenement at Mwanga in Northeast Tanzania, an area that in the past recorded exploration
samples with anomalous rare earth elements content. The total area under these two projects
covers 273.7 square kilometres.
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Tanzania is a politically stable democracy and provides an attractive investment environment. It has
open market policies and is richly endowed with minerals. There are a number of foreign companies
operating successfully in the country ranging from exploration and mining for gold and diamond
mining and exploration for rare earth elements.
Tabora’s board of directors and management has a proven track record of operating in foreign
environments that include Tanzania. It has the technical and corporate skills to run an efficient and
effective exploration company, to apply modern technology to its exploration programs and to
identify and develop new mineral discoveries. Tabora, through its alliance with Resolute, will also
greatly benefit from its local expertise and infrastructure support.
This Prospectus includes details of the Company, describes its exploration assets and proposed
exploration operations and outlines the risks associated with investing in Tabora.
The Prospectus has been issued by Tabora for the purpose of offering 25 million shares at $0.20 each
to raise $5 million before cost of the offer.
On behalf of the Directors, I am looking forward to you joining us as a shareholder. I ask you to study
this document carefully in order to make an informed decision on whether you wish to invest in
Tabora Limited.
Stephan Meyer
Chairman
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1. DETAILS OF THE OFFER
1.1. The Offer
By this Prospectus, the Company invites applications for 25,000,000 Shares at $0.20 each to raise
$5,000,000.
The Shares offered under this Prospectus will rank equally with the existing Shares on issue.
1.2. Minimum Subscription
The minimum subscription in respect of the Offer is $5,000,000. The Company will not allot or issue
any Shares under the Offer in this Prospectus until the minimum subscription is reached.
If the minimum subscription has not been raised within four months after the date of this
Prospectus, the Company will either repay the application monies to Applicants or issue a
supplementary or replacement prospectus to allow Applicants one month to withdraw their
Application and be repaid their application money. No interest will be paid on this money.
1.3. Applications
Applications for Shares under the Offer must be made using the Application Form.
Applications for Shares must be for a minimum of 10,000 Shares and thereafter in multiples of 1,000
Shares and payment for the Shares must be made in full at the issue price of $0.20 per Share.
Completed Application Forms and accompanying cheques, made payable to “Tabora Limited – Share
Offer Account” and crossed “Not Negotiable”, must be mailed or delivered to the address set out on
the Application Form by no later than the Closing Date.
The Company reserves the right to close the Offer early.
1.4. ASX Listing
Application for Official Quotation by ASX of the Shares offered pursuant to this Prospectus will be
made within 7 days after the date of this Prospectus.
If the Shares are not admitted to Official Quotation by ASX before the expiration of 3 months after
the date of issue of this Prospectus, or such period as varied by the ASIC, the Company will not issue
any Shares and will repay all application monies for the Shares within the time prescribed under the
Corporations Act, without interest.
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The fact that ASX may grant Official Quotation to the Shares is not to be taken in any way as an
indication of the merits of the Company or the Shares now offered for subscription.
1.5. Allotment
Subject to ASX granting conditional approval for the Company to be admitted to the Official List and
the Company raising the minimum subscription under the Offer, allotment of Shares offered by this
Prospectus will take place as soon as practicable after the Closing Date.
Pending the allotment and issue of the Shares or payment of refunds pursuant to this Prospectus, all
application monies will be held by the Company in trust for the Applicants in a separate bank
account as required by the Corporations Act. The Company, however, will be entitled to retain all
interest that accrues on the bank account and each Applicant waives the right to claim interest.
The Directors will determine the allottees of all the Shares in their sole discretion. The Directors
reserve the right to reject any application or to allocate any applicant fewer Shares than the number
applied for. Where the number of Shares issued is less than the number applied for, or where no
allotment is made, surplus application monies will be refunded without any interest to the Applicant
as soon as practicable after the Closing Date.
1.6. Applicants outside Australia
This Prospectus does not, and is not intended to, constitute an offer in any place or jurisdiction, or to
any person to whom, it would not be lawful to make such an offer or to issue this Prospectus. The
distribution of this Prospectus in jurisdictions outside Australia may be restricted by law and persons
who come into possession of this Prospectus should seek advice on and observe any of these
restrictions. Any failure to comply with such restrictions may constitute a violation of applicable
securities laws.
No action has been taken to register or qualify the Shares or otherwise permit a public offering of
the Shares the subject of this Prospectus in any jurisdiction outside Australia. Applicants who are
resident in countries other than Australia should consult their professional advisers as to whether
any governmental or other consents are required or whether any other formalities need to be
considered and followed.
It is the responsibility of applicants outside Australia to obtain all necessary approvals for the
allotment and issue of the Shares pursuant to this Prospectus. The return of a completed
Application Form will be taken by the Company to constitute a representation and warranty by the
applicant that all relevant approvals have been obtained.
1.7. Oversubscriptions
No oversubscriptions will be accepted by the Company.
1.8. Not underwritten
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The Offer is not underwritten.
1.9. Commissions payable
The Company reserves the right to pay a commission of up to 6% (exclusive of goods and services
tax) of amounts subscribed through any licensed securities dealers or Australian Financial Services
licensee in respect of valid applications lodged and accepted by the Company and bearing the stamp
of the licensed securities dealer or Australian Financial Services licensee. Payments will be subject to
the receipt of a proper tax invoice from the licensed securities dealer or Australian Financial Services
licensee.
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2. COMPANY & PROJECT OVERVIEW
2.1. Background
Tabora was initially incorporated as a private company, Redox Diamonds Pty Ltd, in the state of
Western Australia, Australia under the Corporations Act 2001 on 14 November 2003. It has
subsequently changed its status to a public company limited by shares as well as changing its name
and is now known as Tabora Limited.
In January 2011, the Company entered into an agreement with Resolute (Tanzania) Limited,
Mabangu Mining Ltd and Mabangu Exploration Ltd, all wholly-owned subsidiaries of Resolute Mining
Limited, to acquire a 100% interest in the non-gold mineral rights on a group of tenements
comprising the Nzega Project. This acquisition remains conditional on the Company raising $5m and
achieving admission to the official list of ASX by 21 April 2012.
In February 2011 the Company acquired a 100% interest in the Mbeya Project. The tenements
comprising the Mbeya Project are currently being held in trust for Tabora under a Deed of
Acknowledgement of Trust by the registered holder, Mr Marko Kishiga (see Section 8.3 of this
Prospectus for further details).
In May 2011 the Company exercised an option under an agreement to acquire a 50% interest in the
Mwanga Project and in November 2011 the Company exercised a further option to acquire the
remaining 50% (see Section 8.4 of this Prospectus for further details).
In refocusing on exploration for rare earth elements (“REE”), the Company’s main targets are
carbonatites, host to many economic REE deposits around the world. Carbonatites are mantle
derived intrusions and show often a spatial relationship with kimberlites, host to diamond deposits.
The magnetic surface expressions of kimberlites and carbonatites are similar.
A secondary exploration focus will be the follow-up of a number of discrete kimberlite targets
previously identified by the Tabora.
The management of Tabora believes that it has secured projects, that are prospective for REE and
that contain carbonatite intrusions (host to economic REE deposits) and kimberlites (host to
diamonds) in areas that are close to infrastructure or support.
These criteria are seen as critical to Tabora’s growth strategy as a junior mineral exploration and
development company, focused primarily on the exploration, discovery and development of grass-
roots REE and diamond deposits in geographically prospective and under-explored regions in
Tanzania.
Investors are encouraged to read the Independent Geologist’s Report in Section 4 of this Prospectus,
the Solicitor’s Report on Tenements in Section 0 and the material contracts summaries in Section 5
for further information pertaining to the Tenements the Company has an interest in. Investors
should also consider the risk factors set out in Section 3.
2.2. Rare Earth Elements Overview
What are Rare Earth Elements
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• A group of 15 lanthanide elements (atomic numbers 57-71), plus the metal yttrium (39) and
scandium (21).
• Widely dispersed geologically, but rarely concentrated in commercial ore deposits.
• REEs are recovered as a group in various minerals. They are extracted by metallurgical
separation and mineralogy is therefore very important. These non- toxic elements are
essential to a cleaner environment and reduced reliance on fossil fuels.
• The light rare earth elements (LREE) are more abundant than heavy rare earth elements
(HREE), consequently, HREE are far more valuable
• Key applications for REEs are in super magnets and phosphors in electronics.
• REEs are used in various aspects of modern life, including hybrid cars, energy saving light
bulbs, LCD screens, solar panels and MP3 ear buds.
Why are they getting so much attention?
• China is a major producer of REEs, accounting for 95% of global supply, and consumes
around 60% of this production.
• In September 2010 China announced that it would progressively reduce its export quota to
35,000 tons per year between 2010 and 2015. This generated a major global concern.
• Growing global demand for REEs and their application to modern green technology, and the
growth of the “green global economy” with the requirements for consistent supply bode
well for future demand.
• It is estimated that 25% of all new technologies rely on REEs. Today great efforts are being
directed toward finding new sources of REEs, not only to enable a release from China’s
monopoly on REEs but to help localize over US$1 billion value of REE products consumed in
the US.
Deposit Types
REE occur in many different types of deposits globally but are predominantly associated with
carbonatites or alkaline intrusions.
2.3. The Projects
Tabora Limited has secured three exploration projects covering a total area of approximately
753km2 located in Tanzania, East Africa. Tanzania has numerous known REE’s occurrences, some
yielding economic grade. The Projects provide an excellent basis to success and the Company is
ready to commence exploration immediately following the Company’s admission to the official list of
ASX.
The table below is a summary of the ground under tenure in which Tabora has an interest. A
detailed schedule is contained in Solicitors Report on Tenements in Section 0.
Project Ownership Area (km2) Targets
Nzega 100%* 479.0 Multiple Carbonatite Intrusives and dykes.
Mbeya 100% 108.4 Carbonatite Intrusives and dykes
Mwanga 100% 165.3 Carbonatite dykes.
* This acquisition remains conditional on the Company raising $5m and achieving admission to the
official list of ASX by 21 April 2012.
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Figure: Location Map
Nzega Project
The Nzega Project consist of 479Km2 of tenure over the southern part of the Lake Victoria Archaean
basement. Subject to completion of the Offer and achieving admission to the official list of ASX by 21
April 2012, Tabora will hold a 100% right to all minerals other than gold in the project under the
Resolute Agreement. The tenure covers a portion of the Golden Pride gold mine tenements owned
by Resolute (Tanzania) Limited. It includes the Matinje tenements located to the east of Resolute
Mining Limited’s Golden Pride gold operation which contains a number of discrete kimberlite
(diamond) targets.
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Figure: Location of the Nzega Project
Mbeya Project
Tabora holds a 100% beneficial interest in two prospecting licences in the Mbeya province in
Southern Tanzania where drill intersections have reported rare earth oxides at the Ngualla
Carbonatite by Peak Resources Limited. The Mbeya province also hosts the Panda Hill deposit. In
other parts of Tanzania carbonatites prospective for REE’s are also reported at Musensi , Songwe
Scarp and Mbalizi The Company believes its Mbeya Project which covers 108.4km2 is highly
prospective with several untested exploration targets.
Limited modern exploration has been undertaken in the Mbeya area and there is very good
exploration potential for new discoveries. The Ngualla Carbonatite is located 125km to the
Northwest of the Mbeya Project.
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Figure: Mbeya Project tenement location
Mwanga Project
Tabora holds a 100% beneficial interest in one prospecting license in North-East Tanzania covering
approximately 165.3km2. The Mwanga Project area is considered prospective for the occurrence of
carbonatite dykes as an unreferenced occurrence of anomalous REE has been reported from a De
Beers geochemical dataset from its search for diamonds in mid 1980s.
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Figure: Mwanga Project tenement location
Diamond prospect
The Matinji Prospect is located within the Nzega Project area. Tabora has previously identified 100
targets and in 2006/2007 drilled 35 from which it has identified 16 new kimberlites. Mineral
concentrates from 12 kimberlites are ready for processing and analysis for diamonds. A significant
number of discrete magnetic anomalies are ready for drill testing. Some of these anomalies may also
be the expression of carbonatites and are therefore prospective for rare earth elements. In the
event of drilling new kimberlites their diamond prospectivity will be tested by analyzing indicator
mineral chemistry and processing samples for microdiamonds.
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Figure: Matinje Project showing location of aeromagnetic targets
Geological and technical datasets
The Company holds significant geological and technical datasets for Tanzania and East Africa. This
includes diamond exploration data that have been accumulated over 40 years and that are relevant
for REE exploration. In addition, through its agreement and alliance with Resolute (Tanzania)
Limited, it has access to its geological datasets and will benefit from its over 15 years in- country
experience. The alliance provides an outstanding platform to seek new opportunities in Tanzania
and other parts of East Africa.
Proposed exploration
Exploration on the Projects is planned to begin immediately following the Company’s admission to
the official list of ASX.
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The following provides is a summary of the planned activity for the following 24 months:
Nzega Mapping, Sampling, Drilling and Data Compilation.
Mbeya Mapping, Sampling, Drilling and Data Compilation.
Mwanga Data Compilation and sampling
The budget allows for over 21,000 metres to be drilled over the 2 years.
Further details of the Projects are set out in the Independent Geologist's Report in Section 4 of this
Prospectus.
Competent Person’s Statement
The information in this section of this Prospectus that relates to exploration results or mineral
resources has been reviewed and compiled by Allen J. Maynard who is a Member of the Australasian
Institute of Geoscientists.
Allen J. Maynard is employed by Al Maynard & Associates Pty Ltd.
Allen J. Maynard has sufficient experience which is relevant to the style of mineralisation and type of
deposit under consideration and to the activity which he is undertaking to qualify as a “Competent
Person” as defined in the 2004 Edition of the ‘Australasian Code for Reporting of Exploration Results,
Mineral Resources and Ore Reserves (“JORC Code”)’. Allen J. Maynard consents to the inclusion in
this section of this Prospectus of the matters based on his information in the form and context in
which it appears.
Refer to the Independent Geologist’s Report in Section 4 of this Prospectus for further details of his
experience and qualifications.
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3. RISK FACTORS
Introduction
The Shares offered under this Prospectus are considered highly speculative. An investment in the
Company is not risk free and the Directors strongly recommend potential investors to consider the
risk factors described below, together with information contained elsewhere in this Prospectus,
before deciding whether to apply for Shares and to consult their professional advisers before
deciding whether to apply for Shares pursuant to this Prospectus.
There are specific risks which relate directly to the Company’s business. In addition, there are other
general risks, many of which are largely beyond the control of the Company and the Directors. The
risks identified in this section, or other risk factors, may have a material impact on the financial
performance of the Company and the market price of the Shares.
The following is not intended to be an exhaustive list of the risk factors to which the Company is
exposed.
Company specific
The key company specific risks detailed in the Investment Overview related to:
• Title – mineral rights only (Nzega Project) & beneficial interest only (Mbeya & Mwanga Projects)
• Title – renewal
• Title – other matters
• Contractual risk
• Co-existence – Nzega Project
• Exploration success
Sovereign
The Company's projects are currently all located outside Australia and as a result are subject to the
risks associated in operating in a foreign country.
These risks may include governmental, political, economic, and other uncertainties, including, but
not limited to, expropriation of property without fair compensation, changes in policies or the
personnel administering them, nationalization, currency fluctuations and devaluations, exchange
controls and royalty increases, renegotiation or nullification of existing concessions and contracts,
changes in taxation policies, economic sanctions, export duties, repatriation of income or return of
capital, environmental protection, labour relations as well as government control over natural
resources or government regulations that require the employment of local staff or contractors or
require other benefits to be provided to local residents, as well as risks of loss due to civil strife, acts
of war, guerrilla activities, insurrections, the actions of national labour unions, terrorism and
abduction.
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Any future material adverse changes in government policies or legislation in foreign jurisdictions in
which the Company has projects that affect foreign ownership, exploration, development or
activities of companies involved in mineral exploration and production, may affect the viability and
profitability of the Company. In addition, the status of Tanzania as a developing country may make it
more difficult for the Company to obtain any required financing because of the investment risks
associated with it.
The Company’s operations may also be adversely affected by laws and policies of Australia affecting
foreign trade, taxation and investment. In the event of a dispute arising in connection with the
Company’s operations in the Tanzania, the Company may be subject to the exclusive jurisdiction of
foreign courts or may not be successful in subjecting foreign persons to the jurisdictions of the
courts of Australia or enforcing Australian judgments in such other jurisdictions. The Company may
also be hindered or prevented from enforcing its rights with respect to a governmental
instrumentality because of the doctrine of sovereign immunity. Accordingly, the Company’s
exploration and development activities in Tanzania could be substantially affected by factors beyond
the Company’s control, any of which could have a material adverse effect on the Company.
Competition Risk
The Company will be competing with other companies in the rare earth elements (REE) and diamond
sector many of which will have access to greater capital than the Company and may be in a better
position to compete for future business opportunities. There can be no assurance that the Company
can compete effectively with these companies.
In addition, an increase in REE projects may accelerate the development of new sources of supply
and the increased competition may lead suppliers and market participants to engage in predatory
pricing behaviour. Any increase in the amount of REE products exported from other nations and
increased competition may result in price reductions, reduced margins and loss of potential market
share, any of which could materially adversely affect the Company’s potential profitability. As a
result of these factors, the Company may not be able to compete effectively against current and
future competitors.
Industry specific
Exploration
The mineral tenements in which the Company has an interest are at various stages of exploration,
and potential investors should understand that mineral exploration and development are high-risk
undertakings.
There can be no assurance that exploration of these tenements, or any other tenements that may be
acquired in the future, will result in the discovery of an economic ore deposit. Even if an apparently
viable deposit is identified, there is no guarantee that it can be economically exploited.
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The future exploration activities of the Company may be affected by a range of factors including
geological conditions, limitations on activities due to seasonal weather patterns, unanticipated
operational and technical difficulties, industrial and environmental accidents, changing government
regulations and many other factors beyond the control of the Company.
The exploration costs of the Company are based on certain assumptions with respect to the method
and timing of exploration. By their nature, these estimates and assumptions are subject to
significant uncertainties and, accordingly, the actual costs may materially differ from these estimates
and assumptions. Accordingly, no assurance can be given that the cost estimates and the underlying
assumptions will be realised in practice, which may materially and adversely affect the Company’s
viability.
In the event that exploration programmes prove to be unsuccessful this could lead to a diminution in
the value of the Tenements, a reduction in the cash reserves of the Company and possible
relinquishment of the Tenements.
Operations
The operations of the Company may be affected by various factors, including failure to locate or
identify mineral deposits, failure to achieve predicted grades in exploration and mining, operational
and technical difficulties encountered in mining, difficulties in commissioning and operating plant
and equipment, mechanical failure or plant breakdown, unanticipated metallurgical problems which
may affect extraction costs, adverse weather conditions, industrial and environmental accidents,
industrial disputes and unexpected shortages or increases in the costs of spare parts, plant and
equipment and consumables, particularly fuel, energy, chemical reagents and other products which
may be required to be used in future exploration, development and treatment operations.
No assurances can be given that the Company will achieve commercial viability through the
successful exploration and/or mining of its tenement interests. Until the Company is able to realise
value from its projects, it is likely to incur ongoing operating losses.
Resource estimates
The Company does not presently have any JORC Code compliant resources on the tenements in
which it is earning an interest. In the event a resource is delineated this would be an estimate only.
An estimate is an expression of judgement based on knowledge, experience and industry practice.
Estimates which were valid when originally calculated may alter significantly when new information
or techniques become available. In addition, by their very nature, resource estimates are imprecise
and depend to some extent on interpretations, which may prove to be inaccurate. As further
information becomes available through additional fieldwork and analysis, the estimates are likely to
change. This may result in alterations to development and mining plans which may, in turn,
adversely affect the Company’s operations.
Rare earth elements (REE) market
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If the Company achieves success leading to production, the revenue it will derive through the sale of
REE exposes the potential income of the Company to price risks. REE prices can fluctuate widely and
are affected by many factors beyond the control of the Company, including, there being no
transparent two-way market or spot price for REE, the limited number of REE suppliers with almost
all the global supply currently comes from Chinese production sources, supply and demand
fluctuations for REE as well as the intermediate and end products that use these raw materials,
technological advancements, forward selling activities and other macro-economic factors such as
inflation and interest rates.
The value and price of the Shares and the Company’s financial results may be significantly adversely
affected by declines in the prices of REE.
A prolonged or significant economic contraction worldwide puts downward pressure on market
prices of REE minerals and products. Protracted periods of low prices for REE minerals and products
could significantly reduce the availability of required development funds in the future. If market
price for REE falls below the Company’s future full production costs and remain at such levels for any
sustained period of time, it may not be economically feasible to commence or continue production
of deposits that would be economical under different market conditions.
In contrast, extended periods of high commodity prices may create economic dislocations that may
be destabilising to REE minerals supply and demand and ultimately to the broader markets. Periods
of high REE mineral market prices will generally be beneficial to the financial performance of the
Company. However, strong REE mineral prices also create economic pressure to identify or create
alternate technologies that ultimately could depress future long-term demand for REE minerals and
products, and at the same time may incentivise development of otherwise marginal REE mining
properties.
Diamond market
Changes in the market price of diamonds, which in the past has fluctuated widely, will affect the
ability of any mining operations established by the Company in the future to be profitable.
The market for rough diamonds is subject to various factors and is heavily influenced by the world’s
largest diamond producer, De Beers Consolidated Mines Ltd., which has the ability to affect prices
through the control of sales volumes.
In addition, diamond prices fluctuate widely as a result of numerous other factors beyond the
Company’s control, including, global or regional demand for industrial and retail diamonds, currency
exchange fluctuations, interest rates, expectations of inflation, global or regional political, social and
economic trends or events, confidence in the global monetary system, speculative activities by
producers and traders, increases in production due to improved mining and production methods.
If market prices for diamonds fall below the Company’s future full production costs and remain at
such levels for any sustained period of time, it may not be economically feasible to commence or
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continue production of deposits that would be economically diamondiferous under different market
conditions.
Exchange rate
International prices of rare earth elements and diamonds, being the current focus of the Company,
are denominated in foreign currencies, whereas the income and expenditure of the Company are
and will be taken into account in Australian currency, exposing the Company to the fluctuations and
volatility of the rate of exchange between these foreign currencies and the Australian dollar as
determined in international markets.
Environmental
The operations and proposed activities of the Company are subject to laws and regulations
concerning the environment applicable in the jurisdiction of those activities. As with most
exploration projects and mining operations, the Company’s activities are expected to have an impact
on the environment, particularly if advanced exploration or mine development proceeds. Laws and
regulations that effect mineral exploration and development include laws and regulations relating to
the environment, prospecting, mining, development, production, waste disposal, reclamation,
labour standards, occupational health and safety standards and taxes.
It is the Company’s intention to conduct its activities to the highest standard of environmental
obligation, including compliance with all environmental laws. Although management believes that
the Company’s exploration activities have been, and will continue to be, carried out in accordance
with all applicable rules and regulations, there can be no certainty that new rules and regulations
will not be enacted or that existing rules and regulations will not be applied in a manner which could
limit or curtail the Company’s activities. Failure to comply with applicable laws and regulations may
result in enforcement actions thereunder, including orders issued by regulatory or judicial
authorities causing operations to cease or be curtailed, and may include corrective measures
requiring capital expenditures, installation of additional equipment, or remedial actions. The
Company may be required to compensate any third parties who suffer loss or damage as a result of
the Company’s exploration or mining activities. In addition, the cost of compliance with changes in
environmental regulations has a potential to increase the cost of exploration and reduce the
profitability of any operations.
Insurance
The Company intends to insure its operations in accordance with industry practice. However, in
certain circumstances, the Company’s insurance may not be of a nature or level to provide adequate
insurance cover. The occurrence of an event that is not covered or fully covered by insurance could
have a material adverse effect on the business, financial condition and results of the Company.
Insurance against all risks associated with mining exploration and production is not always available
and where available the costs can be prohibitive.
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The Company will maintain insurance where it is considered appropriate to its needs however it will
not be insured against all risks either because appropriate cover is not available or because the
Directors consider the required premiums to be excessive having regard to the benefits that would
accrue.
General risks
Economic
General economic conditions, introduction of tax reform, new legislation, movements in interest and
inflation rates and currency exchange rates may have an adverse effect on the Company’s
exploration, development and production activities, as well as on its ability to fund those activities.
Market conditions
Share market conditions may affect the value of the Company’s quoted securities regardless of the
Company’s operating performance. Share market conditions are affected by many factors such as:
• general economic outlook;
• introduction of tax reform or other new legislation;
• interest rates and inflation rates;
• changes in investor sentiment toward particular market sectors;
• the demand for, and supply of, capital; and
• terrorism or other hostilities.
The market price of securities can fall as well as rise and may be subject to varied and unpredictable
influences on the market for equities in general and resource exploration stocks in particular.
Neither the Company nor the Directors warrant the future performance of the Company or any
return on an investment in the Company.
Additional requirements for capital
The Company’s capital requirements depend on numerous factors. Depending on the Company’s
ability to generate income from its operations, the Company may require further financing in
addition to amounts raised under the capital raising. Any additional equity financing will dilute
shareholdings, and debt financing, if available, may involve restrictions on financing and operating
activities. If the Company is unable to obtain additional financing as needed, it may be required to
reduce the scope of its operations and scale back its exploration programmes as the case may be.
There is however no guarantee that the Company will be able to secure any additional funding or be
able to secure funding on terms favourable to the Company.
Reliance on key personnel
The responsibility of overseeing the day-to-day operations and the strategic management of the
Company depends substantially on its senior management and its key personnel. There can be no
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assurance given that there will be no detrimental impact on the Company if one or more of these
employees cease their employment.
Investment speculative
The above list of risk factors ought not to be taken as exhaustive of the risks faced by the Company
or by investors in the Company. The above factors, and others not specifically referred to above,
may in the future materially affect the financial performance of the Company and the value of the
Shares offered under this Prospectus
Therefore, the Shares to be issued pursuant to this Prospectus carry no guarantee with respect to
the payment of dividends, returns of capital or the market value of those Shares.
Potential investors should consider that the investment in the Company is highly speculative and
should consult their professional advisers before deciding whether to apply for Shares pursuant to
this Prospectus.
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4. INDEPENDENT GEOLOGIST'S REPORT
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AL MAYNARD & ASSOCIATES Pty Ltd Consulting Geologists
www.geological.com.au (ABN 75 120 492 435)
9/280 Hay Street, Tel: (+618) 9388 1000 Mob: 04 0304 9449 SUBIACO, WA, 6008 Fax: (+618) 9388 1768 [email protected] Australia
Australian!&!International!Exploration!&!Evaluation!of!Mineral!Properties!
INDEPENDENT GEOLOGICAL REPORT
on
TABORA MINERAL ASSETS
IN TANZANIA
Prepared for
TABORA LIMITED
Authors: Allen J. Maynard , BAppSc(Geol), MAIG, MAusIMM Greg D. Pooley PhD, MBA, MAusIMM. Company; Al Maynard & Associates Pty LtdDate 18th January, 2012
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Table of Contents Page
INDEPENDENT GEOLOGICAL REPORT ......................................................................... 1!EXECUTIVE SUMMARY ................................................................................................... 3!1.! BACKGROUND INFORMATION ON THE UNITED REPUBLIC OF TANZANIA ...... 5!1.1.! DEMOGRAPHICS AND GEOGRAPHIC SETTING................................................... 5!1.2.! POLITICAL AND FINANCIAL STATUS ..................................................................... 6!1.3.! ACCESSIBILITY, CLIMATE, LOCAL RESOURCES, INFRASTRUCTURE AND
PHYSIOGRAPHY...................................................................................................... 6!1.4.! TANZANIAN GEOLOGY ........................................................................................... 7!2.! RARE EARTHELEMENTS AND MINERALS ............................................................ 9!2.1.! DEMAND................................................................................................................... 9!2.2.! WORLD DEPOSITS ................................................................................................ 10!2.3.! SUBSTITUTES ....................................................................................................... 11!2.4.! RARE EARTH DEPOSIT TYPES ............................................................................ 11!2.5.! MINERALS THAT CONTAIN REES ........................................................................ 11!2.6.! GEOLOGY OF REE DEPOSITS ............................................................................. 12!2.7.! EXPLORATION TECHNIQUES .............................................................................. 13!3.! TABORA’S RARE EARTH PROJECTS IN TANZANIA ........................................... 15!3.1.! NZEGA PROJECT – ALLIANCE WITH RESOLUTE MINING LTD ......................... 17!3.2.! MBEYA PROJECT .................................................................................................. 18!3.3.! MWANGA PROJECT .............................................................................................. 19!3.4.! PROPOSED WORK PROGRAM AND BUDGET FOR TABORA’S RARE EARTH
PROJECTS ............................................................................................................. 20!4.! DIAMONDS ............................................................................................................. 23!4.1.! INTRODUCTION ..................................................................................................... 23!4.2.! DIAMOND HISTORY OF TANZANIA ...................................................................... 23!4.3.! PRESENCE OF KNOWN KIMBERLITES ............................................................... 24!4.4.! TABORA DIAMOND PROJECTS IN TANZANIA .................................................... 24!4.4.1. TABORA MATINJE DIAMOND PROJECT ............................................................ 24!4.4.2. DIAMOND EXPLORATION BY TABORA IN 2006/07 ........................................... 25!4.4.3. SAMPLING METHOD AND APPROACH .............................................................. 28!4.4.4. NEW KIMBERLITE TARGETS .............................................................................. 29!4.4.5. DATA VERIFICATION ........................................................................................... 29!4.4.6. INTERPRETATION AND SUMMARY .................................................................... 29!4.4.7. RECOMMENDATIONS ......................................................................................... 30!4.4.8. WORK PROGRAM AND BUDGET ........................................................................ 30!5. SUMMARY AND CONCLUSIONS ............................................................................... 32!6.0 REFERENCES .......................................................................................................... 33!7.0 GLOSSARY OF TECHNICAL TERMS AND ABBREVIATIONS ................................ 41!APPENDIX 1 -REE AND DIAMOND TENEMENT SCHEDULE IN TANZANIA ............... 44!
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List of Figures ............................................................................................................. Page
Figure 1:Tanzania Infrastructure. ....................................................................................... 5!Figure 2: Simplified Geological Map of Tanzania. ............................................................ 8!Figure 3:Periodic Table showing the REE, Yttrium and other Rare Metals. ....................... 9!Figure 4: Known Carbonatites and Kimberlites of Tanzania showing the carbonatite complexes on Mbeya, Matinji, Mwanga and Nzega and Tabora project areas. ............... 16!Figure 5: Distribution of Carbonatites and Syenites by G.m.b.H. ..................................... 17!Figure 6: Location of the Nzega Project. ......................................................................... 18!Figure 7: Mbeya Project Tenement Location. ................................................................. 19!Figure 8: Mwanga Project Tenement Location. .............................................................. 20!Figure 9: Matinje Project showing Location of the Aeromagnetic Targets. ...................... 26!Figure 10: Target MT19 – Mineral Chemistry of Garnets. ............................................... 27!Figure 11: Target MT19 – Mineral Chemistry of Ilmenites. ............................................. 27!Figure 12: MT19 – Diamond Preservation Potential. ...................................................... 28!Figure 13: Example of untested magnetic anomalies at Matinje (MT20) ......................... 29!
List of Tables
Table 1: Location of the World’s Major Rare Earth Mines ............................................... 10!Table 2:Minerals that contain REEs and occur in economic deposits. ............................. 12!Table 3: Rare Earth Projects of Tabora. ......................................................................... 15!Table 4: Carbonatite Occurences in Tanzania. ............................................................... 15!Table 5: Two Year Exploration Budget for Tabora Projects. ........................................... 21!Table 6: Proposed Drilling for Nzega Project. ................................................................. 21!Table 7: Proposed Expenditure for Nzega Project. ......................................................... 21!Table 8 Proposed Drilling for Mbeya Project. ................................................................. 22!Table 9: Proposed Expenditure for Mbeya Project. ........................................................ 22!Table 10 Proposed Drilling for Mwanga Project. ............................................................. 22!Table 11: Proposed Expenditure for Mwanga Project. .................................................... 22!Table 12: Tenement Details of the Matinje Diamond Project. .......................................... 24!Table 13: Aeromagnetic Surveys of the Matinje Project ................................................. 25!Table 14: Drill Sample DIM Recoveries. ......................................................................... 26!Table 15: Tabora Proposed Diamond Exploration Expenditure Years 1 & 2. ................. 31!
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Tabora Limited Independent Appraisal 1
The Directors, 18th January, 2012, Tabora Limited338 Hay Street Subiaco, WA 6008
Dear Sirs,
Independent!Geological!Report!
This Independent Geological Report (“Report”) was prepared by geologists A.J. Maynard, Member of the AIG and AusIMM and Dr G. Pooley, MAusIMM.
This Report is to be included in a prospectus to be lodged by Tabora Limited (“Tabora” or “the Company”) with the Australian Securities and Investments Commission (“ASIC”) on or about 20thJanuary 2012 for an initial public offer of securities in Tabora (“Prospectus”). The funds raised under the Prospectus are to be used primarily for the purpose of exploration and evaluation of Tabora’s Mineral Assets in Tanzania.
Tabora’s primary current exploration focus is on rare earth elements (”REE”) in Tanzania. A secondary focus is low-key follow-up of diamond exploration undertaken by Redox Diamonds. This Report is divided into two sections, one dealing with the Company’s rare earth assets and a second section dealing with the Company’s diamond assets.
This is not an independent valuation report, and as such, serves only to comment on the geological setting and proposed exploration programs on the properties. We have not been asked to comment on the potential economic value or financial considerations pertaining to the value of securities in or assets held by Tabora in relation to these properties.
Details in respect to the legal status and tenure of the mineral assets have not been considered in this Report but are outlined in the Solicitor’s Report on Tenements set out in Section 6 of the Prospectus.
Scope and limitations This Report is valid as at the date of its issue, which was the date of the final review of the assets of Tabora. This assessment can be expected to change over time having regard to political, economic, market and legal factors. This Report may also vary due to the success or otherwise of any mineral exploration that is conducted either on the properties concerned or by other explorers on prospects in the near environs. This Report could also be affected by the consideration of other exploration data, not in the public domain that have not been made available to the author.
In order to form an opinion as to the status of any of the properties, it is necessary to make assumptions as to certain future events, which might include economic and political factors and the likely exploration success. The writers have taken all reasonable care in formulating these assumptions to ensure that they are appropriate to the case. These assumptions are based on the writer’s technical training and experience in the mining industry.
The opinions expressed represent the writers’ fair professional opinion at the date of this Report. These opinions are not however, forecasts as it is never possible to predict accurately the many variable factors that need to be considered in forming an opinion as to the state of any mineral property.
The readers should therefore form their own opinion as to the reasonableness of the assumptions made.
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Tabora Limited Independent Appraisal 2
Sources of information In the course of the preparation of this Report, access has been provided to all relevant data by Tabora and includes many reports with references too numerous to list. We have made all reasonable endeavours to verify the accuracy and relevance of the database.
The directors of Tabora have confirmed in writing or verbally that to the best of their knowledge all technical data known to Tabora and/or in its possession have been made available to the writer and that the information is complete, accurate and true. They have also confirmed in writing that other professionals have made assessments of the mineral properties that are the subject of this Report within the last three to four years and that they have been disclosed to the writer.None of the information provided by Tabora has been specified as being confidential and not to be disclosed in our Report.
Given the early stage nature of Tabora projects, it was deemed unnecessary to conduct a site visit and we have relied on information supplied by Tabora plus other information in the public domain.
Relevant codes and guidelines ThisReport has been prepared in accordance with the relevant requirements of the Listing Rules of the Australian Securities Exchange, ASIC Regulatory Guides 111 & 112 (which replaced Practice Notes 42 and 43) and the Guidelines for Assessment and Valuation of Mineral Assets and Mineral Securities for Independent Expert reports (the Valmin Code – updated 1999 & 2005) which is binding on members of the Australian Institute of Geoscientists (“AIG”) and the Australasian Institute of Mining and Metallurgy (“AusIMM”).
Where and if mineral resources have been referred to in this Report, the classifications are consistent with the Australasian Code for Reporting of Mineral Resources and Ore Reserves (“JORC Code”), prepared by the Joint Ore Reserves Committee of the Australasian Institute of Mining and Metallurgy, the Australian Institute of Geoscientists and the Minerals Council of Australia, effective December 2004.The information in this Report that relates toexploration results is based on information reviewed and compiled by Allen J. Maynard who consents to the inclusion in this Report of this information in the form and context in which it appears.
Qualifications, experience and independence Al Maynard & Associates (“AM&A”) is an independent geological consultancy firm established 25 years ago and which has operated continuously since then. Neither AM&A nor any of its directors, employees or associates have any material interest either direct, indirect or contingent in Taboranor in any of the mineral properties included in this Report nor in any other asset of Taboranor has such interest existed in the past. This Report has been prepared by AM&A strictly in the role of an independent expert and we have had no input towards the tenement selection process.
This report has been authored by Allen J. Maynard BAppSc, MAIG, MAusIMM, Principal of Al Maynard and Associates (“AM&A”), a geologist with more than 30 years continuous experience in mineral exploration and more than 25 years experience in mineral asset valuation and Dr Greg D. Pooley who has over 40 years in mineral exploration and mineral asset evaluation. The writers hold the appropriate qualifications, experience and independence to qualify as an independent “Expert” under the definitions of the Valmin Code.
Tabora will be invoiced and expected to pay a fee for the preparation of this Report. This fee comprises a normal, commercial daily rate plus any relevant expenses. Payment is not contingent of the results of this report or the success of any subsequent public fundraising. Except for these fees, neither the writers nor associates have any interest neither in the properties reported upon nor in Tabora.
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Executive!Summary!
Taborais focussed on the exploration of rare earth minerals in carbonatites in Tanzania. The objective of Tabora is to explore its Tanzanian assets and develop a rare earth minerals company. Some of Tabora’s mineral properties also have significant diamond potential.However its primary focus is to pursue Rare Earth Elements (“REE”) and development of opportunities in Tanzania, East Africa.
Rare earths are critical constituents of many advanced high technology materials. Currently, China is producing approximately 95% of rare earth minerals consumed globally. With the recent decision of the Chinese government to reduce the export quota of these minerals there is growing pressure on demand resulting in significant price increases in the last 12 months and pressure to satisfy the global demand for rare earths.
Tabora re-negotiated an agreement with Resolute Mining Limited (“Resolute”) and formed a strong alliance with the company which is one of the major gold mining operaters in Tanzania. Under the agreement,on raising $5m and achieving admission to the official list of ASX by 21 April 2012, Tabora will hold a 100% right for all mineral rights except gold on groups of tenements held by Resolute covering a total area of 479km2 in Tanzania and known as the Nzega Project.
Tabora (previously known as Redox Diamond Limited) conducted significant exploration for diamonds in Tanzania in 2006 and 2007 under a joint venture agreement with Resolute and located several potential diamond bearing kimberlites.
During these diamond exploration programs Resolute and the Company jointly funded significant aerial geophysical surveys which delineated numerous exploration targets for both kimberlites (host to diamond deposits) and carbonatites which are the geological host to many major economic rare earth deposits around the world. The exploration of these targets is at an advanced stage and a number of targets are ready for drilling. These are highly prospective targets and offer an opportunity for rapid exploration success. In addition, there are a number of high priority kimberlite targets also ready for drill testing.
Tabora has also acquired, via option agreements with Tanzanian prospectors, 100% interests on three tenements that are highly prospective for rare earth minerals. Two tenements are located in the area of the Mbeya carbonatite field in Southern Tanzania that contains a large low grade rare earth deposit and one tenement at Mwanga in Northeast Tanzania, an area that in the past recorded exploration samples with anomalous rare earths content.
Tanzania is a politically stable democracy and provides an attractive investment environment. It has open market policies and is richly endowed with mineral resources. There are a number of foreign companies operating successfully in the country including the exploration and mining of gold and diamonds mining as well as the exploration of rare earth minerals.
AM&A believe that Tabora has the technical skills, country experience and corporate ability to run an efficient and effective exploration company in Tanzania. Tabora will apply modern technology in its exploration programs and identify and develop new mineral discoveries rapidly and effciently. The Company holds significant geological and technical databases for Tanzania and East Africa which include a diamond database that has been accumulated over 40 years and is specifically relevant for REE exploration. In addition, through its agreement and alliance with Resolute it has access to Resolute’s geological database and over 15 years experience in Tanzania. AM&A believes that this alliance provides an outstanding platform to seize new opportunities in Tanzania and other parts of East Africa.
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Tabora will initially focus on numerous advanced rare earth exploration targets delineated in earlier diamond exploration programs.The Company has three exploration projects which are considered to be highly prospective for the occurrence of REE mineralisation:
! Nzega Project (100% right – all minerals excluding gold – subject to Tabora raising $5m and achieving admission to the official list of ASX by 21 April 2012)
! Mbeya Project (100% owned) ! Mwanga Project (100% owned)
Tanzania is known to host at least 21 carbonatites and the outlook for further discoveries is considered excellent. This is highlighted by the recent announcement by Peak Resource Limited (“Peak”). Peak has discovered extensive Rare Earth Oxide (REO), niobium-tantalum and phosphate mineralisation within the Ngualla Carbonatite in Southern Tanzania which is in the same province as Tabora’s Mbeya Project.
The combined ground holding of Tabora’s three projects is approximately 753km2 and considered under-explored for REE mineralisation. This offers an exploration opportunity for the discovery of economic mineralisation associated with carbonatites.
Exploration is planned to begin immediately following a successful Initial Public Offering and AM&A believe that there is potential to achieve early exploration success.
A number of drill-ready kimberlite targets are located in the Nzega Project area (Matinje) some of which may be diamondiferous.
AMA believes that with its tenements, Tabora is well placed to take advantage of the current strong rare earth market. Tabora plans to pursue an aggressive and well planned exploration program. The Company will initially focus on their existing exploration targets and will greatly benefit through its alliance with Resolute and its long-standing experience in Tanzania.
AMA understands that the objective of Tabora is to build and develop, a strong rare earth minerals company based on its Tanzanian assets. Although Tabora’s exploration ground has also significant diamond potential, its primary focus is to pursue REE exploration and development opportunities.
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1. Background!Information!on!the!United!Republic!of!Tanzania!
1.1. Demographics!and!Geographic!Setting!
The United Republic of Tanzania is located in eastern Africa. The country has an area of 945,087km2 and is bounded by the neighbouring countries of Mozambique, Malawi, Zambia, Democratic Republic of Congo, Burundi, Rwanda, Uganda and Kenya to the south, west, north and northeast respectively, and by the Indian Ocean to the east (Figure 1).
Figure 1:Tanzania Infrastructure. (courtesy of the University of Texas Libraries, University of Texas at Austin)
Tanzania has endeavoured to unify its diverse population under the ‘Ujamaa’ Policy initiated by the first post-Independence President Julius Nyerere. Tanganyika was granted independence in 1961 followed by Zanzibar in 1963. The UnitedRepublic (Tanganyika and Zanzibar) of Tanzania was formed in 1964. Tanzania’s diversity embraces both ethnic groups comprising about 125 African dialects (mostly related to Swahili) as well as roughly equal religious
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affiliations (Islam, Christianity and African Traditional Religion). Today’s population stands at about 34 million.
Dar es Salaam, on the coast, is the de facto capital. The political decision to relocate the capital to Dodoma in the central interior has been limited to legislative functions only. Tanzania is still largely a rural community and economy with probably over 80% of the population engaged in traditional farming and herding. The Ujamaa Policy had been intended to promote a collective lifestyle whereby improved access to basic healthcare and education services could be achieved. The policy lost favour during the 1980s. The communal and state ownership of enterprises and industries gave way to a macro-economic policy stressing private sector initiatives and foreign investment. The 1985 Economic Recovery Programme was intended to stimulate business and encourage investment. Slow progress is being made in achieving these new objectives.
1.2. Political!and!Financial!Status!
Generally the socio-economic infrastructure of Tanzania is fair and the country is ranked 162nd
out of 177 countries by the UN in that organisation’s human development index (for comparison, South Africa was ranked 121st).The Tanzania currency is called a Tanzania Shilling (TZS). As at the the date of this Report the exchange rate was A$1 = TZS 1,676
1.3. Accessibility,!Climate,!Local!Resources,!Infrastructure!
and!Physiography!
Themajority of the Project concessions are located in the Shinyanga and Tabora Provinces of the United Republic of Tanzania sharing similar access, climate, local resources, infrastructure and physiography.
Access
Tanzania extends westwards from its Indian Ocean coastline to the East African Rift Valley that forms its western border with Malawi, Zambia, Democratic Republic of Congo, Burundi and Rwanda. Much of Tanzania is an ancient upland erosion surface of low relief. The land surface rises through a series of steps from the coast to about 1,500m, and then slopes down westwards to the rift at 1,000m.
The tectonic activity associated with both the eastern and western branches of the East African Rift Valley has given rise to several impressive volcanic peaks; Mounts Kilimanjaro and Meru in the northeast rise to 5,900m and 4,500m respectively. Within the eastern rift that extends in a northerly direction across the centre of Tanzania are a series of magnificent lakes bounded by extensive fault scarps.
One of the Projects, Nzega,is located south of Lake Victoria and west of the famous Serengeti Plain and the Eastern Rift with the Ngorongoro Crater in open generally flat granite plains with sporadic greenstone hills and granite tors. The general elevation is approximately 1,000m. The other two Projects are located in Southern Tanzania (Mbeya) and Northeast Tanzania (Mwanga) respectively.
Climate
Tanzania enjoys a tropical climate along the coast varying to temperate in the interior except for the high peaks such as Kilimanjaro where alpine conditions prevail. Arid areas with precipitation less than 500mm/y exist in the central part of the country. In contrast, the coastal
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areas are very humid with precipitation of about 1,500mm/y.
Rainfall in Tabora’ Project areas comes in two periods during the year; the ‘big rains’ from March to June and the ‘little rains’ from mid-November to the end of December. Temperatures vary little throughout the year generally remaining in the 22o to 25oC range.
The rainfall pattern strongly influences the exploration field season as many of the local access tracks can become impassable during the rains. However the operating mines have established procedures to limit the adverse effects of heavy rains and generally operate throughout the year.
Local Resources and Infrastructure
Overland access to the Lake Victoria Goldfields from the Indian Ocean port of Dar es Salaam is improving as a consequence of the development of several gold mines such as Golden Pride. Tar surfaced roads continue to be built in the area and a rail link from Mwanza on the shores of Lake Victoria to the coast at Dare es Salaam passes through both Shinyanga and Tabora.
There are regular local air routes connecting Mwanza, Shinyanga and Tabora to other centres in Tanzania and onward international links through Dar es Salaam. Access to Mbeya in Southern Tanzania and to Mwanga in Northeast Tanzania is fair to good.
Although hydro-power generation has been developed and transmission lines carry power to major centres this electricity has become unreliable in recent times due to water shortages. Local diesel back-up power generation has become essential in the goldfields.
Physiography
The vegetation cover in the country follows the rainfall and climate pattern. Thus variation is from the tropical coastal regions to the temperate interior and alpine mountain lands. In the Project areas savanna vegetation of bushland, woodland, and wooded grassland has been largely replaced by clearing for agricultural development.
Tanzania is world-renowned for its flora and fauna and 20% of the country is now protected within National Parks, Game Reserves and Conservation Areas. These vary from the semi-arid Serengeti to the alpine peak of Kilimanjaro. Forest Reserves have also been established throughout the country to reduce deforestation challenges.
1.4. Tanzanian!Geology!
A crustal block known as the Tanzania craton underlies a large portion of northern and central Tanzania. The rocks comprise a typical granite-greenstone terrain of Archaean age, including the Dodoma, Nyanzian and Kavirondian Supergroups. The full extent of the Achaean Tanzania Craton is not apparent from the geological map due to the peripheral cover of younger rocks.
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Figure 2: Simplified Geological Map of Tanzania. (Courtesy of the Ministry of Energy and Minerals, United Republic of Tanzania)
Proterozoic age Usagaran, Ubendian and Karagwe-Ankolean fold belts surround the craton to the east and west, and the Late Proterozoic continental Bukoban plateau sediments cover the northwest portion of the craton. Younger Palaeozoic and Mesozoic sediments are found in the south and southwest, and in the coastal basins (Karoo group). Cainozoic marine and continental sediments are situated both on the coastal plain and inland.
Break-up of the eastern side of the African plate occurred during the Mesozoic and accelerated during late Cainozoic time. Rifting established the extensive north-south trending East African Rift. In Tanzania, rifting is concentrated along an Eastern and Western arm and had an important effect on the economic geology of Tanzania.
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Tertiary-age carbonatites and kimberlites occur as small volcanic plugs across Tanzania, especially in the interior plateau area south of Lake Victoria. Miocene to modern alkali extrusive volcanism is restricted to north-central Tanzania and the north end of Lake Nyasa; in both locations this volcanism is directly associated with the present day East African Rift.
2. Rare!EarthElements!and!Minerals!
Rare earth elements (“REE”) are incorporated into many modern technological devices, including superconductors, samarium-cobalt and neodymium-iron-boron high-flux rare-earth magnets, electronic polishers, refining catalysts and hybrid car components.
Rare Earths (Figure 3) are a group of 17 chemically similar elements, consisting of 15 elements known as the lanthanides plus Yttrium and Scandium.They have unique properties: Chemical, catalytic, electrical, magnetic, metallurgic andoptical. Rare Earths underpin new materials technology required to sustain the needs of today’s society.
Figure 3:Periodic Table showing the REE, Yttrium and other Rare Metals.
2.1. Demand!
The importance of rare earth to the world’s economies has been particularly evidenced in the past one or two years as the dependence on its supply from China came into focus. China presently accounts for over 95% of all REE production and has been a cheap supplier for many years. Total REE production in 2010 was approximately 115,000t.
A few sites are under development outside of China, the most significant of which are the Nolan’s Bore Project in Central Australia, the remote Hoidas Lake project in northern Canada and the Mt. Weld project in Australia.
Based on apparent consumption derived only from 8 months of trade data, domestic consumption of rare earths in 2010 increased significantly compared with that of 2009.
Owing to declining supply, prices for most rare-earth products increased rapidly in the third quarter of 2010.
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With improving economic conditions, consumption generally increased for cerium, compounds used in automotive catalytic converters and in glass additives and glass-polishing compounds; rare-earth chlorides used in the production of fluid-cracking catalysts for oil refining; rare-earth compounds used in automotive catalytic converters and many other applications; and rare-earth metals and their alloys used in armaments and base-metal alloys.
Consumption was stable in lighter flints, permanent magnets, pyrophoric alloys, and superalloys; yttrium compounds used in colour televisions and flat-panel displays, electronic thermometers, fibre optics, lasers, and oxygen sensors; and phosphors for colour televisions, electronic thermometers, fluorescent lighting, pigments, superconductors, x-ray-intensifying screens, and other applications.
Neodymium, Dysprosium, Terbium and Europium are currently in highest demand.
2.2. World!Deposits!
Rare earths are relatively abundant in the Earth’s crust, but discovered minable concentrations are less common than for most other ores. Deposits are contained primarily in bastnäsite and monazite.
Bastnäsite deposits in China and the United States constitute the largest percentage of the world’s rare-earth economic deposits, while monazite deposits in Australia, Brazil, China, India, Malaysia, South Africa, Sri Lanka, Thailand, and the United States constitute the second largest segment. Apatite, cheralite, eudialyte, loparite, phosphorites, rare-earth-bearing (ion adsorption) clays, secondary monazite, spent uranium solutions, and xenotime make up most of the remaining deposits.
Since1998, more than 90% of the world’s REE raw materials have come from China, and most of this production is from the Bayan Obo deposit in Inner Mongolia.
Table 1: Location of the World’s Major Rare Earth Mines Location Type Location Type Bayan Oba, China
Fe-REE-Nb Orissa, India Monazite
Weishan, China Bastnasite-barite
Eneabba, WA Monazite
Mooniuping,China
Ditto Capel, WA Monazite
Xunwu, Longnan, China
Lateritic Clay Mt Weld, WA Laterised carbonatite
Chavara, India Monazite Dubbo, NSW Alkaline Complex Perak, Malaysia Xenotine Nth Stradbroke, Qld Monazite Mountain Pass, USA
Bastnasite-baritecarbonatite
Elliot Lake, Canada Uraniferous conglomerate
Lovozero,Russia
Loparite-Peralkaline
Green Cove Springs USA
Monazite
Aldyus, Kyrgystan
Polymetallic Camaratuba, Brazil Monazite
Nth Sri Lanka Monazite Steenkampstraal, RSA
Monazite Apatite
The Bayan Obo deposits currently dominate worldwide REE production.
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2.3. Substitutes!
Substitutes are available for many applications but generally are less effective.
2.4. Rare!Earth!Deposit!Types!
REE occur in many different types of deposits but commercially are only produced from a few sources that include:
Magmatic deposits: ! Carbonatites e.g. Mountain Pass, California; ! Alkaline rocks and veins, e.g. Toongi (NSW) and Ponton Creek (WA); ! Hydrothermal iron-oxide deposits containing REE, e.g. Bayan Obo (China); ! Placer deposits, e.g. Richards Bay (South Africa); ! Conglomerates, e.g. Elliot Lake (Canada).
Secondary Deposits: ! Lateritic carbonatites, e.g. Mount Weld, (WA); ! Ionic or ion absorption deposits, e.g. Lognan (China).
2.5. Minerals!that!contain!REEs!
Although REEs comprise significant amounts of many minerals,almost all production has come from less than 10 minerals. Table 4lists those that have yielded REEs commercially or have potentialfor production in the future.
Extraction from an REE deposit is strongly dependant on its REE mineralogy. In the past, producing deposits were limited to those containing REEbearingminerals that are relatively easy to concentrate because ofcoarse grain size or other attributes.
Minerals that are easily brokendown, such as the carbonate bastnasite, are more desirable thanthose that are difficult to dissociate, such as the silicate allanite.Placer monazite, once an important source of REEs, has beenlargely abandoned because of its high thorium content.
Recently, REEs absorbed on clay minerals in laterite have become importantsources of REEs in China.
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more than 10% REOs. REEs are mainly in bastnasite and monazite (Table 5), but at least 20 otherREE-bearing mineralshave been identified (Yuan et al. 1992).Bayan Obo ore has extreme LREE enrichment with no europiumanomalies and low strontium (87Sr/86Sr) (Nakai et al.1989; Philpotts et al. 1989). Alkali-rich alteration (fenitization), predominated by sodic amphibole and potash feldspar, is associated with the REE mineralisation (Drew, Meng, and Sun 1990).
Recent research points to ore formation during hydrothermal replacement of sedimentary dolomite.
The huge Middle Proterozoic Olympic Dam copper-uranium-silver-gold deposit, South Australia, may also be included in this deposit type because most of the ore is breccia that contains 40% to 90% hematite along with quartz, sericite, fluorite, barite, sulphides, and REE minerals (Oreskes and Einaudi 1990). Olympic Dam is a potential source of by-product REEs, but typical content is about 0.5% total REEs, and there are no plans for REE production from the deposit. Extremely fine-grained monazite and bastnasite are the most abundant REE minerals, and the LREE/HREE ratio is high inOlympic Dam ore.
Carbonatite Deposits
Many carbonatite intrusions are enriched in REEs.The large Mountain Pass rare earth deposit in California which resumed production recently is carbonatite hosted.
The Mountain Pass deposit contains approximately 8.9% REO (Castor and Nason 2004). The deposit typicallycontains 10% to 15% bastnasite, 65% calcite or dolomite, and20% to 25% barite. The Mountain Pass deposit is high in LREEs and HREEs (Figure 4). The carbonatite has been dated at about1.4Ga (DeWitt, Kwak, and Zartman 1987).
Carbonatite complexes in eastern Canada also contain REE mineralisation. Brazilian carbonatites contain significant REE resources buthave yielded only minor production to date. Niobium ore in theBarreiro Complex at Araxá, Minas Gerais, with Nb2O5 grades averaging 2.5% and containing about 4.4% REOs (Issa Filho, Lima, and Souza 1984).
Importantly African carbonatites also contain LREE-dominated depositsthat are largely unexploited. Carbonatite dykes at Wigu Hill, Tanzania, contain up to 20% REOsas monazite and REE fluoro-carbonate minerals of possible hydrothermalorigin (Deans 1966). The Palabora carbonatite in SouthAfrica, which occurs in a large Early Proterozoic potassic alkalinecomplex, has significant copper and apatite production and has beenevaluated as a source of REEs.
2.7. Exploration!Techniques!
Carbonatite REE deposits and many HREE deposits occur in, or areas associated, with alkaline rocks in circular complexes, generally in Precambrian host rocks. Such complexes may be identified usingaerial photography, even in deeply weathered and highly vegetatedareas. Although isolated alkaline-carbonatite complexes such asMount Weld in Australia do occur, most are in clusters or linear belts like those associated with rift zones in eastern Africa and theAraxá–Catalão belt in Brazil.
Geophysical methods that can be used to search for buried iron-REE deposits and some REE carbonatite deposits include gravity surveys and airborne or surface magnetic surveys. The effectiveness of such methods is based on anomalous density and magnetic susceptibility of a deposit and the associated rocks.
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Geochemical prospecting using heavy-mineral concentrationof active stream sediments can be very effective because most REEminerals are relatively heavy and resistant. Concentrates made byhand panning, mechanized gravity concentration, or heavy mediaseparation can be analysed for REEs using inexpensive multi-elementanalytical techniques.
Normal surface exploration techniques, such as trenching andpitting by heavy equipment, are used to evaluate poorly exposed REE deposits. Exploratory dredging is used to locate beach placerdeposits. In countries with low labour costs, hand pitting may beused to evaluate placer deposits or unconsolidated deposits such asthose in laterite.Drilling techniques utilized for hard-rock REE exploration andprospect evaluation are mainly core drilling and dual-tube rotary orhammer drilling.
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3. Tabora’s!Rare!Earth!Projects!in!Tanzania!
Tabora has three exploration projects (Table 4) which are considered to be highly prospective for the occurrence of REE mineralisation. Combined ground holding covers approximately 753km2. Although Tanzania has significant known REE occurrences, AMA considers the country remains under-explored. Most of the known rare earth mineralisation in the country is associated with carbonatite intrusions.
Table 3: Rare Earth Projects of Tabora.
Project Ownership Area (km2) TargetNzega 100%* 479.0 Multiple Carbonatite Intrusives and dykes.Mbeya 100% 108.4 Carbonatite Intrusives and dykes
Mwanga 100% 165.3 Carbonatite dykes* conditional on Tabora raising $5m and achieving admission to the official list of ASX by 21 April 2012
Tabora’s tenement schedule is shown in Appendix 1.
Tabora holds significant geological and technical datasets for Tanzania and East Africa which includes diamond data that have been accumulated over 40 years, that is considered relevant for REE exploration. This includes the data set from the Company’s diamond exploration programs in 2006 and 2007. In addition, through its agreement and alliance with Resolute (Tanzania),Tabora has access to Resolute’s geological datasets and over 15 years in-country experience.
The alliance provides an outstanding platform to seek new mineral opportunities in Tanzania and other parts of East Africa. Exploration is planned to begin immediately and the Directors of Tabora believe that there is an opportunity to achieve early exploration success and generate shareholder value based on the prospectively of the Projects held by the Company.
Tanzania is known to host at least 21 carbonatites (Table 6) and the outlook for further discoveries is considered very good. This is highlighted by the recent announcement by Peak Resource Limited, a company listed on the ASX. Peak has discovered extensive REE, niobium-tantalum and phosphate mineralisation within their Ngualla Carbonatite in southern Tanzania which is in the same province as the company’s Mbeya project. Tabora ground holding is considered under-explored for REE mineralisation and offer significant potential for the discovery of REE mineralisation.
Table 4: Carbonatite Occurences in Tanzania.
Deposit Area Economic Potential Comment
Gallappo Nb Brecciated carbonatite
Wigu Hill Morogoro REE + Phosphate Carbonatite
Maji Morogoro REE + Phosphate Carbonatite Dykes Zizi Morogoro Phosphate Apatitic Dykes Panda Hill Mbeya Nb + Phosphate Carbonatite
Musensi Mbeya REE + Phosphate Carbonatite
Songwe Scarp Mbeya REE + Phosphate Carbonatite
Mbalizi Mbeya Phosphate Carbonatite Nachendezwaya Mbeya Nb +Phosphate Alkalic Complex with apatite Ngualla Mbeya REE + Phosphate Carbonatite
Sengeri Hill Mbeya REE + Phosphate Carbonatite
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Figure 4: Known Carbonatites and Kimberlites of Tanzania showing the carbonatite complexes on Mbeya, Matinji, Mwanga and Nzega and Tabora project areas.
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Figure 5: Distribution of Carbonatites and Syenites by G.m.b.H.
3.1. Nzega!Project!–!Alliance!with!Resolute!Mining!Ltd!
Tabora and Resolute have established a strategic alliance with respect to exploration, development and mining on a group of tenements in Tanzania in which Resolute has a 100% interest (Nzega project). Under this agreement Tabora has a 100% interest for all minerals except goldconditional on the Company raising $5m and achieving admission to the official list of ASX by 21 April 2012.
The Nzega Project tenements cover a total of 479km2and are situated on the Archaean Craton in Tanzania in which a significant number of kimberlites, some of them diamondiferous, have been discovered by previous explorers.
Geology and Exploration Targets
Rare earths are the principle exploration focus in the Nzega project. A secondary exploration focus within Nzega is centred in the Matinje area in low-key follow-up exploration for diamonds.
Resulting from its previous extensive diamond exploration programs in the Nzega area, Tabora possesses a significant database from which it has identified a large numbers of discrete anomalies from detailed aeromagnetic surveys which were followed up in the field with ground magnetic surveys of drilling. Tabora can build on this data and generate new targets including for rare earth.
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Tabora datasets consist of geological databases of previous exploration and exploration which includes geology, geophysics and geochemistry data. The Company is in possession of drilling material including mineral concentrates and will process and anlyse these samples for rare earth minerals as well as for microdiamonds.
Figure 6: Location of the Nzega Project.
3.2. Mbeya!Project!
Tabora signed an agreement with local Tanzanian prospectors securing two tenements in the Mbeya area of Southern Tanzania. Under the agreement the Company has 100% ownership of all minerals covering an area of approximately 108km2.
The Mbeya district contains a number of carbonatite intrusions, some with substantial but at this stage uneconomic grade of rare earths. The best documented deposit is the Panda Hill carbonatite which hashas significant tonnage potential with grades of up to0.33% Niobium and 3.5% of P2O5 quoted on the basis of exploration in the late 1970. Approximately 125km to the north of the Mbeya carbonatite cluster Peak Resources Limited recently announced economic grade of rare earth metals and phosphate from the Ngualla carbonatite.
The Mbeya region and its extension to the North and South along one of the branches of the East African Rift are considered very prospective for new rare earth discoveries.
The Company has identified several targets that are considered prospectivive for REE
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mineralisation. These targets are shown in Figure 8.
Figure 7: Mbeya Project Tenement Location.
3.3. Mwanga!Project!
Under an agreement with the owners,Tabora has a 100% interest in the Mwanga project located in the north-east of Tanzania. The Mwanga tenement covers an area of approximately165.3km2 in which De Beers have reportably recorded anomalous REE in a geochemical dataset in their search for diamonds in the mid 1980’s.
Pegmatites were recognised within the prospect but have never been followed up for REEs. De Beers reported a few small diamonds in stream samples however no work was carried out on the REE potential.
The project comprises one prospecting license covering an approximate area of 165.28km2
(16,528ha). Tenement details are provided in Appendix 1 and the REE target identified is shown in Figure 9. F
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Figure 8: Mwanga Project Tenement Location.
3.4. Proposed! Work! Program! and! Budget! for! Tabora’s! Rare!
Earth!Projects!
Following the IPO, the Company intends to immediately commence specificly targeted exploration programs. The following table provides a summary of the planned activity and budget for the first two years years:
! Nzega; mapping, sampling, drilling and data compilation, ! Mbeya; mapping, sampling, drilling and data compilation and ! Mwanga; data compilation and sampling
The total exploration budget for the company’sRare Earth targets is $2.9million and is summarised in Table 5.
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Table 5: Two Year Exploration Budget for Tabora Projects.
Project Year 1 Year 2 Nzega $770,000 $890,000 Mbeya $340,000 $440,000 Mwanga $190,000 $270,000 Total $1,300,000 $1,600,000 Overall Total $2,900,000
The budget allows for approximately 21,000 metres to be drilled over the 2 years.
Exploration Strategy The company plans to commence exploration atits identified targets at Nzega. Further targets are expected to be generated via sampling and data compilation of the existing historical and Tabora databases.
Drilling will commence by aircore to identify mineralised areas and on successful identification of REE mineralisation RC drilling will be carried out to define mineral resources.
Nzega Project This work will include:
! Data compilation of the significant datasets available to Tabora. ! REE analysis of drill spoils and drill samples from previous drilling. ! Soil sampling surveys over identified targets. ! Modelling of geophysical data sets – magnetic. ! Ground magnetic surveys to help define drilling targets. ! Target generation studies. ! Drill testing; aircore initially with RC follow-up.
Table 6: Proposed Drilling for Nzega Project.
Item Year 1 Year 2 Holes Metres Holes Metres
Aircore Drilling 40 3,200 30 2,400 RC Drilling 20 2,400 45 5,400 Total 60 5,600 75 7,800
Table 7: Proposed Expenditure for Nzega Project.
Item Year 1 Year 2 Tenements $40,000 $40,000 Geochemistry $30,000 $30,000 Geophysics $80,000 $20,000 Consultants and Wages $200,000 $120,000 Drilling and Sampling $330,000 $550,000 Assaying $60,000 $120,000 Environmental and Community $30,000 $10,000 Total $770,000 $890,000
The proposed budget detailed in table 7 includes tenement management fees for the Matinji diamond project. A separate budget for Matinji can be found in Table 15.
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Mbeya Project This work will include: ! Data compilation. ! Mapping and sampling. ! Ground magnetic surveys to confirm targets. ! Drill testing; aircore initially, RC follow-up.
Table 8 Proposed Drilling for Mbeya Project.
Item Year 1 Year 2
Holes Metres Holes Metres Aircore Drilling 10 800 15 1,200 RC Drilling 5 600 20 2,400 Total 15 1,400 35 3,600
Table 9: Proposed Expenditure for Mbeya Project.
Item Year 1 Year 2
Tenement $10,000 $10,000 Geochemistry $50,000 $10,000 Geophysics $50,000 - Consultants and Wages $70,000 $100,000 Drilling and Sampling $100,000 $250,000 Assaying $40,000 $50,000 Environmental and Community $20,000 $20,000 Total $340,000 $440,000
Mwanga Project This work will include: ! Detailed geological mapping and rock sampling of all outcrop. ! Soil sampling over selected traverses. ! Ground magnetic surveys to identify targets. ! Drill testing by aircore drilling.
Table 10 Proposed Drilling for Mwanga Project. Item Year 1 Year 2
Holes Metres Holes MetresAircore Drilling - - 40 3,200 RC Drilling - - - - Total - - 40 3,200
Table 11: Proposed Expenditure for Mwanga Project. Item Year 1 Year 2 Tenements $10,000 $10,000 Geochemistry $40,000 $10,000 Geophysics $50,000 - Consultants and Wages $50,000 $50,000 Drilling and Sampling - $150,000 Assaying - $30,000 Environmental and Community $40,000 $20,000 Total $190,000 $270,000
The Company’s exploration budget will be subject to review and modification on an ongoing basis depending on the results obtained from exploration and development activities as they progress.
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4. Diamonds!
!
4.1. Introduction!
!
Tabora undertook significant diamond exploration programs in Tanzania in 2006 and 2007 through its joint venture with Resolute Mining Limited. The area of interest was centred in the Matinje block of tenements located some 25km to the east of Resolute’s Golden Pride Goldmine. Detailed aeromagnetic surveys undertaken by Resolute – some jointly funded with Tabora - identified a large number of discrete magnetic anomalies which Tabora interpreted as possible expressions of kimberlite intrusions. The Company drilled a number of targets and intersected 16 new kimberlites.
Although Tabora’s exploration emphasis will now be on rare earths, the Company plans to undertake some low key diamond work in the Matinje area. It will mainly consist of taking advantage of the drill material of the holes drilled in 2006/07 which has not yet been fully processed.The Company plans to process and analyse samples for kimberlitic indicator minerals and selected samples for microdiamonds. The Matinje area remains very prospective for the discovery of further kimberlite pipes, some of which may be diamondiferous and contain economic grade. Subject to diamond market conditions and investors interest Tabora may step up its exploration activity in diamonds.
4.2. Diamond!History!of!Tanzania!
The first diamonds in Tanzania were found at Mabuki, between Shinyanga and Mwanza in 1910. Although the Mwadui mine has over the years proved to be the only world class deposit discovered in Tanzania to date, the country remains prospective for hosting diamond-bearing kimberlites.
Several small operations preceded the famous Williamson/Mwadui Mine, including the Mabuki mine which was owned and worked by Dr Williamson. In 1940, in the Shinyanga area, some 160km south of Mwanza on Lake Victoria Williams discovered the kimberlite that made him world famous. The site was named Mwadui after a local chief. Since then the names “Mwadui” and “Williamson” have become virtually synonymous.
The Mwadui Mine
The Mwadui kimberlite pipe covers 146ha and ranks as the areally largest economically mined diamond pipe in the world. The mine has been in continuous operation since the early 1940s. After Dr Williamson death in 1958 De Beers purchased fifty percent of the mine but this was subsequently nationalised by the Tanzania Government in 1971. Following a long period of declining production and profitability Tanzania invited De Beers to purchase 75% of the Mwadui mine with the Tanzanian government retaining the remaining 25% share.
The Mwadui mine is presently characterised by a low diamond grade of approximately 6 ct/100t (carats per hundred tonnes of ore). The grade has decreased dramatically over the mine's life from 30 ct/100t in the first 25 years. Production in the 1950s and 1960s was between 500,000 ct/y and 750,000 ct/y with a peak of 924,984 ct in 1966. Over its lifetime it has produced over 19 Mct of diamonds. The current mining rate is approximately 3Mt ore per year. The diamonds are valued at approximately US$140 per carat from past sales.
Mwadui has produced some notable stones, including a 54ct flawless pink diamond (presented to then-Princess Elizabeth and Prince Philip upon their wedding in 1947), and a 388 carat
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diamond found in 1990. Large gemstone quality diamonds are consistently recovered, extending the viability of the mine.
Petra Diamonds Ltd acquiredMwadui in Tanzania in September 2008 fromDe Beers.Petra Diamonds has announced a three-year major expansion plan for the Mwadui Mine.
4.3. Presence!of!Known!Kimberlites!
It is generally agreed that the geotectonic controls on kimberlite emplacement and diamond preservation modelled by Helmstaedt and Gurney (1995) applies also to the Archaean Tanzania Craton. The presence of known diamondiferous kimberlites and the Mwadui diamond mine support this view. Many researchers have described the kimberlites of Tanzania. Although earlier reports exist, the presentation of Edwards and Howkins (1966) is a classic reference because of the detailed description of the Mwadui kimberlite. Gobba (1989) has added to the list of occurrences which has been most recently reviewed by Janse and Sheahan (1995). This last reference quotes that over 400 kimberlites are known in Tanzania.
The distribution of the kimberlites shows a crude north-northwest to south-southeast elongation that may represent a significant trend.
Accepting the statistics expressed by many diamond geologists that the industry average of 1 in 100 kimberlitesis diamondiferous and potentially economic, the large number of kimberlites in Tanzania suggests that Mwadui is not the only viable diamond deposit and that diligent exploration may yield new economic diamond deposits.
4.4. Tabora!Diamond!Projects!in!Tanzania!
4.4.1.!Tabora!Matinje!Diamond!Project!
Tabora’s diamond interest is centred on the Matinje area which is located some 25km east of Resolute’s Golden Pride gold mine. It consists of four tenements – two granted and two under application – with an aggregate area of 182.7km2. The tenements are part of the alliance with Resolute in which Taborahas a 100% interest in all minerals except goldconditional on the Company raising $5m and achieving admission to the official list of ASX by 21 April 2012. The Project area is located on the Archaean craton and fulfills all the geological and structural criteria for the emplacement of kimberlites that are potentially diamondiferous. Tabora drilled 16 new kimberlites in 2006/07 and there are a number of untested magnetic anomalies some of which are likely to be expressions of kimberlites.
Table 12: Tenement Details of the Matinje Diamond Project.
Nzega Project (100% - All minerals excluding gold)
Lease Lease Name
LeaseStatus
Area Application
Date Expiry Date
Project Registered Holder
HQ-P21632 Matinje Application 46.01 28/04/2010 Matinje Mabangu Exploration Ltd
PL4282/2007 Matinje East Granted 45.09 27/04/2006 11/04/2010 Matinje Mabangu Mining Limited
HQ-P21549 Matinje East 2 Application 45.35 12/04/2010 Matinje Resolute Tanzania Limited
PL6219/2009 Matinje 3 Granted 46.25 25/04/2008 30/12/2012 Matinje Mabangu Mining Limited
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4.4.2.!Diamond!exploration!by!Tabora!in!2006/07!
After entering a joint venture agreementwith Resolute in 2006 the Company saw an opportunity to re-evaluate the diamond exploration potential for parts of Tanzania by assessing newly available detailed aeromagnetic data. A number of regional and detailed aeromagnetic data sets and other GIS data were obtained from Resolute under a confidentiality agreement. One new aeromagnetic- electromagnetic survey was joint-funded and flown by Resolute and the Company. These aeromagnetic data provided an opportunity to assess kimberlite targets on Resolute’s tenements. The process was to seek the classic dipole magnetic responses of kimberlite targets which would then be covered by ground geophysical surveys and reviewed for possible drilling. The exploration approach was set out to rapidly assess pipes for their diamond potential by collection of diamond indicator minerals for prospectivity analysis prior to the more extensive phase of mini-bulk sampling and large-scale bulk sampling for diamonds.
Table 13: Aeromagnetic Surveys of the Matinje Project
Survey name Date Line
spacing Azimuth
Terrainclearance (m)
Survey type
Matinje 2003 100 m 090º 50 m Magnetics, radiometrics, dtm
Matinje West 2003 100 m 360º 30 m Horizontal gradient magnetics,
radiometrics, dtm
Geophysical processing and interpretation had been completed by Resource Potentials Geophysics for Tabora. They identified numerous kimberlite targets and produced data sets and images suitable for further interpretation and targeting. Targets were collated and systematically investigated in the field. Ground geophysics were carried out over discrete aeromagnetic anomalies that were interpreted to represent kimberlite pipes, dykes or blows on dykes. A large number of discrete targets were identified.
Drilling had been carried out in two campaigns, one in 2006 and one in 2007. Seven magnetic targets were drilled in 2006 and 28 targets in 2007, all in the Matinje project area. In total 16 targets returned kimberlites. Geochemical samples were collected from the drill spoil and 12 kimberlite samples were sent to MSA laboratory in Johannesburg for the recovery of diamonds and indicator minerals. These samples were only partly processed.
Diamond Indicator Minerals (“DIM”) were recovered from the drilling material and some were analysed for their mineral chemistry.
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Figure 9: Matinje Project showing Location of the Aeromagnetic Targets.
Table 14: Drill Sample DIM Recoveries.
Magnetic Target
Number of garnets
Number of ilmenites
Number of chromites
Number of chrome
diopsides MT07 2 0 51 2 MT11 0 2 1 0 MT11 0 0 40 0 MT19 102* 100* 55 0 MT19 220# 261# 203# 186#
MT33 2 0 50 0 MT33 8 101 1 3 MT67 11 41 5 0
Notes for table 14 these results indicate the potential for the source rock being diamondiferous. * a maximum of 100 grains from each mineral type have been selected from this sample. # a maximum of 200 grains from each mineral type have been selected from this sample.
The sample preparation and handling procedures are discussed in section4.4.3.
It is not the aim of this Report to discuss in detail the mineral chemistry of samples analysed from some kimberlites drilled in the Matinje area. However, an example is given below of kimberlite MT19. Garnets and ilmenites from the two samples show chemical trends (Figure 10, 11)) that confirm the kimberlitic origin of the grains. Most compositions are typical G9 lherzolitic pyrope garnets. The small number of G10 harzburgitic pyrope garnets have compositions falling below the diamond/graphite stability line.However most of the ilmenitegrains have low
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MnO contents consistent with diamond association assuming a normal cratonic geothermal gradient.
Further heavy mineral separation work of available concentrate samples obtained from drilled kimberlite is warranted and analysis of indicator minerals should be undertakento establish chemical trends with greater confidence.
Figure 10: Target MT19 – Mineral Chemistry of Garnets.
Figure 11: Target MT19 – Mineral Chemistry of Ilmenites.
Garnet Plot after Gurney (1984). Graphite-diamond constraint after Grutter and Sweeney (2000)
0
2
4
6
8
10
12
14
16
0 1 2 3 4 5 6 7 8 9 10
wt% CaO
wt%
Cr 2
O3
MT19 (TND10004) MT19 (TNR10006)
G 10 - Harzburgitic Garnets G 9 - Lherzolitic Garnets
Cr - Poor Eclogitic Garnets
N = 200
Diamond
Graphite
Ilmenite plot after Wyatt et al, (2004)
30
35
40
45
50
55
60
0 2 4 6 8 10 12 14 16 18 20
wt% MgO
wt%
TiO
2
MT19 (TND10004) MT19 (TNR10006)
N = 62
Non Kimberlitic
Kimberlitic
Para Kimberlitic
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Figure 12: MT19 – Diamond Preservation Potential.
Ilmenites from MT19 (Figure 12) confirm a kimberlite origin but show marginal diamond preservation potential.
4.4.3.!Sampling!Method!and!Approach!
Exploration work on Tabora’sdiamond projects involved surface mapping and the collection and analysis of soil samples for the recovery of kimberlitic indicator minerals (DIMs).
Sample quality hasnot been independently checked. Observation of the Tanzanian sampling procedures as well as verification and repeat laboratory work in Australia and elsewhere are required and will guide any changes necessary to improve the quality of the sampling and subsequent results.
Microdiamond recovery has not yet been undertaken and should be done on selected samples.
Testing of the diamond grade of the known kimberlites and any newly discovered bodies within the company’s exploration licences will be carried out by bulk sampling using trenching for near surface occurrences and mini-bulk sampling by drilling for more deeply buried bodies. A Dense Media Separation Plant (DMS) would need to be purchased for bulk sample processing.
Sample Preparation and Analyses
The sample preparation and handling protocols used to date have not been documented. The procedures must be the subject of careful review and documentation by Tabora going forward. MSA Geoservices (Pty) Ltd in Johannesburg, South Africa, have provided laboratory services for an initial two batches of samples sent to Johannesburg, South Africa. The laboratory techniques, procedures and QA/QC measures are considered adequate in the authors’ opinion, and are typical for similar DIM sampling programs for a variety of clients using these services.
Ilmenite plot showing diamond preservation potential.
0
5
10
15
20
25
30
35
40
45
50
55
60
0 2 4 6 8 10 12 14 16 18 20
wt% MgO
wt%
Fe
2O
3
MT19 (TND10004) MT19 (TNR10006)
Ultimate preservation
92% dodecs
Marginal Preservation
No preservation
N = 62
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4.4.4.!New!kimberlite!Targets!
There are at least some 20 untested discrete magnetic targets that have been identified for field follow-up and drilling. Ground magnetic surveys have already been conducted on some by Tabora in the past and these targets are ready for drilling (Fig. 4). The available detailed aeromagnetic data require re-assessment for more subtle anomalies. Concentrates of new kimberlites will be sorted for diamond indicator minerals and mineral chemistry. Subject to their chemistry selected samples will undergow microdiamond recovery.
There is a realistic opportunity for early exploration success.
Figure 13: Example of untested magnetic anomalies at Matinje (MT20)
4.4.5.!Data!Verification!
The Tabora Tanzania Diamond Project is at an early stage of maturity. At the date of this Report the data adequacy is limited. It is the intention of the forward program to create new data through exploration such that kimberlite and diamond discoveries can be made and economic viability investigated. Currently historic data reliability requires verification through careful (duplicate) sampling and testing in the field. The locations of some historic kimberlite discoveries are very poorly documented and essentially require “re-discovery” to ensure nothing is overlooked in the current program. For example, some kimberlite locations presented in maps of a previous explorer are not geo-referenced and careful scaling from the licence boundaries is the only way of coordinating a location for confirmation in the field. !
4.4.6.!Interpretation!and!Summary!!
The TaboraTanzania Diamond Project is predicated on the re-interpretation of aeromagnetic data made available through the alliance with Resolute with dipole anomalies characteristic of kimberlite pipes as exploration targets. Although these surveys were not originally flown with kimberlite pipe exploration in mind, exploration produced encouraging results. Many of the surveys have been flown with north-south line directions and others were oriented across geologic structures hosting possible gold mineralisation.
The study of the aeromagnetic data had provided many targets for ground follow-up and drilling. 16 kimberlites were discovered by Tabora in 2006/07.The mineral analyses produced useful information which is still incomplete. A number of drill samples and mineral concentrates have not yet been processed and analysed for indicator minerals and microdiamonds. Many more magnetic targets remain to be drilled.
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The diamond exploration program by Tabora in 2006/07 produced very encouraging results and confirmed its exploration strategy. The logistical support from Resolute assisted significantly in the field campaigns.
The Tabora Tanzania Diamond Project is progressing in line with the stated corporate strategy. A number of excellent kimberlite targets require field follow-up and drilling, and it is expected that new kimberlites will be discovered in the Matinje tenement area. Some have a realistic potential to be diamond bearing.
It is emphasised that many kimberlites have been found in Tanzania and most have no economic potential.However the Mwadui/Williamson mine demonstrates that the right combination of diamond grade and value can provide the foundation for a viable mining operation. This project can achieve success if economic mineralisation is present within the project areas.
4.4.7.!Recommendations!
The forward strategy of Tabora is:
! Completion of processing and mineral chemistry analyses from drill holes drilled in 2006/07.
! Selecting samples for microdiamond analysis. ! Identification of new targets from airborne surveys and ground checking. ! Drilling of kimberlite and assessment of diamond potential from DIMs.
Each phase of this strategy is clearly dependent on the successful completion of the earlier phase. The recommendations here embrace all Tabora project areas in Tanzania seen as a single project.
Tabora’s proposed exploration strategy is considered to be consistent and appropriate providing that target priorities are clearly adhered to and exploration is appropriately staged to permit continual assessment of progressive exploration results.
Tabora’s management has significant experience and expertise in all facets of diamond exploration and the alliance with Resolute adds to the Comany’s strength to conduct successful exploration.
Tabora personnel have provided work programs and budgets covering proposed exploration for Years 1 and 2. Planned work for the company’s project over the next 24 months is summarised below. AM&A considers that the programs are consistent with the potential and stage of development of the various projects.
4.4.8.!Work!Program!and!Budget!
Tabora’s current proposed diamond program in Tanzania is of-low key nature due to the present diamond market and limited investors’ interest in diamond exploration. If and when the diamond interest changes, Tabora’s exploration programs for diamonds can be adjusted and stepped up. The initial program is the completion of processing and indicator mineral analysis of drill material from the 2006/07 exploration work. It should be noted that kimberlite exploration budgets are difficult to predict accurately and may be subject to change based on the results of staged exploration.
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Matinje Project
The first priority is to complete the processing and analysis of available drill material obtained from the 2006/07 programs. Some samples will be selected for microdiamond processing. An in-depth assessment of all results will then be undertaken in order to prioritise additional follow-up exploration on the drilled kimberlite targets.
For new kimberlite target generation detailed ground magnetic surveys will be conducted over high priority selected aeromagnetic targets, followed by reconnaissance aircore/RC drilling Geochemical and DIM samples from the drill chips will be collected for initial diamond prospectivity assessment on any kimberlites discovered. !
Tabora has prepared a provisional budget for the proposed two year diamond exploration program for the Matinje Project and is detailed in the Table 18. AM&A has reviewed this budget and believes the projected expenditures are adequate to complete the work programs proposed.
It is logical and prudent that less prospective areas will be progressively relinquished as the results of initial exploration are evaluated. In this case funds should be reallocated to other projects.
Table 15: Tabora Proposed Diamond Exploration Expenditure Years 1 & 2.
Item Year 1 Year 2
Geochemistry $25,000 - Geophysics $20,000 - Consultants and Wages $25,000 $30,000 Drilling and Sampling - $100,000 Assaying $30,000 $20,000 TOTAL $100,000 $150,000
Tabora also plans to continue with a generative program focused on identifying new diamond exploration opportunities in Tanzania and this work is integral to the company’s medium-term exploration strategy to assess project areas and to retain a minimum number of active prospective projects at any one time. Budget allocations (incorporated into the initial costs) for this work over the next two years cover the cost of ongoing research and evaluation of prospective diamond areas as well as possible future property acquisition costs for new project areas.
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5.!Summary!and!Conclusions!
Taboraowns 100% right (conditional on the Company raising $5m and achieving admission to the official list of ASX by 21 April 2012) in all minerals except gold in the Nzega Project in which it has an alliance with Resolute. AM&A consider that the Tabora mineral assets have very good exploration potential for the discovery of potentially economic rare earth bearing carbonatites and diamondiferous kimberlites.
In addition to the Resolute alliance properties Tabora secured two carbonatite projects, Mbeya in Southern Tanzania situated within a field of carbonatites and Mwanga in Northeast Tanzania.
The prospect for success appears to be realistic in the Company’s project areas given that mineralisedcarbonatites and kimberlites are well-documented in Tanzania. 21 carbonatite intrusions are known to occur in Tanzania and some have recently been found to contain economic grade REE mineralisation. As to diamonds; the country is well endowed with kimberlites, some diamondiferous, which includes the large Mwadui diamond deposit mined for more than 50 years.
The Matinje Diamond Project, part of the Resolute alliance properties, is host to numerous known kimberlites, and it is very likely that additional kimberlite pipes will be identified. The diamond potential of each new discovery continues to be assessed. The remaining properties are also considered to have been acquired on the basis of sound technical merit, and further exploration is justified.
The rare earth and diamond potential of Tanzania is considered similar to other rare earth and diamond mining countries.Tabora’s management has the experience and skills which it has proven in its exploration campaigns in 2006/07 to undertake successful exploration of its projects. Tabora will benefit significantly from its alliance with Resolute’s extensive exploration experience, by providing past exploration data from its gold exploration programs in Tanzaniaand giving valuable infrastructure support.
Recommendations
Tabora has provided AM&A with exploration strategies and budgets for each of the Projects which collectively involve an expenditure of approximately $2,900,000 over an initial 24 month period. AM&A considers that the proposed exploration strategies are entirely consistent with the potential of the projects and that the proposed schedules are achievable and adequate to meet minimum expenditure requirements on the current properties.
Yours faithfully,
Allen J. Maynard BAppSc(Geol), MAIG, MAusIMM
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related and Feoxide-type deposits. Geological Society of America Abstracts with Programs 33(6):3. ! Smith, M.P., and P. Henderson. 2000. Preliminary fluid inclusion constraints on fluid evolution in the Bayan Obo
Fe-REE-Nb deposit, Inner Mongolia, China. Economic Geology 95:1371–1388. ! Smith, M.P., P. Henderson, and L.S. Campbell. 2000. Fractionation of the REE during hydrothermal processes;
constraints from the Bayan Obo Fe-REE-Nb deposit, Inner Mongolia, China. Geochimica et Cosmochimica Acta 64(18):3141–3160.
! Staatz, M.H. 1983. Geology and Description of Thorium and Rare Earth Deposits in the Southern Bear Lodge Mountains, Northeastern Wyoming. Professional Paper 1049-D. Reston, VA: USGS.
! Staatz, M.H., B.J. Sharp, and D.L. Hetland. 1979. Geology and Thorium Resources of the Lemhi Pass Thorium District, Idaho and Montana. Professional Paper 1049-A. Reston, VA: USGS
! Stachel, T., Harris, J.W. and Brey, G.P. (1999) Inclusions in diamonds from Mwadui (Tanzania) — chemical mush in the source. Extended Abstracts. Seventh International Kimberlite Conference. Cape Town, South Africa. 859-861
! Steenfelt, A. 1991. High-technology metals in alkaline and carbonatitic rocks in Greenland: Recognition and exploration. Journal of Geochemical Exploration 40:263–279.
! Stockley, G.M. (1947) The geology and mineral resources of Tanganyika Territory. Bulletin of the Imperial Institute. 45; 4, 375-406
! Tainton, K.M., Seggie, A.G., Bayly, B.A., Tomlinson, I. and Quadling, K.E. (1999) Garnet Thermobarometry: Implications for mantle heat flow within the Tanzanian Craton. In: The PH Nixon Volume. Proceedings of the VIIth International Kimberlite Conference. (Eds: Gurney, JJ, Gurney, JL, Pascoe, MD, Richardson, SH). 2. 852-860.
! Tanzania (2003) Tanzania – Opportunities for Mineral Resource Development. Ministry of Energy and Minerals, United Republic of Tanzania.
! Taylor, R.P., and P.J. Pollard. 1996. Rare earth element mineralization in peralkaline systems; the T-zone-REE-Y-Be deposit, Thor Lake, Northwest Territories, Canada. Pages 167–192 in Rare Earth Minerals: Chemistry, Origin, and Ore Deposits. Edited by A.P. Jones, F. Wall, and C.T. Williams. Mineralogical Society Series 7. London: Chapman and Hall.
! Taylor, S.R., and S.M. McClennan. 1985. The Continental Crust: Its Composition and Evolution. Oxford, UK: Blackwell Scientific Publications.
! Tremblay, M. (1956) Geology of the Williamson diamond mine, Mwadui, Tanganyika. Doctoral Thesis. McGill University. Montreal, PQ, Canada
! Trueman, D.L., J.C. Pedersen, L. de St Jorre, and D.G.W. Smith. 1988. The Thor Lake rare-metal deposits. Northwest Territories. Pages 280–290 in Recent Advances in the Geology of Granite- Related Mineral Deposits. Edited by R.P. Taylor and D.F. Strong. Montreal, Quebec: Canadian Institute of Mining and Metallurgy.
! Tsai, M.H.M. (1978) Mineralogical and geochemical investigations of mineral inclusions in diamond, kimberlite and associated rocks. Doctoral Thesis. Purdue University. West Lafayette, IN, United States. p202
! Tsai, M.H.M., Meyer, H.O.A., Moreau, J. and Milledge, H.J. (1979) Mineral inclusions in diamond, Premier, Jagersfontein and Finsch kimberlites, South Africa, and Williamson Mine, Tanzania. In: Boyd, F. R and Meyer, H. O. A (Eds) Kimberlites, diatremes, and diamonds; their geology, petrology, and geochemistry. Proceedings of the International Kimberlite Conference. 2, Vol. 1, 16-26
! U.S. Geological Survey (2006) Mineral Commodity Summaries, January 2006 ! UNDP (1980) Mineral exploration in North West Tanzania; Project findings and recommendations. New York 1-
44. ! UNDP (1986) The diamond exploration potential of Tanzania. Project No. URT/86/035 Draft Technical Report No.
10 ! Vallee, M., and F. Dubuc. 1970. The St-Honore carbonatite deposit, Quebec. Transactions of the Canadian
Institute of Mining and Metallurgy 73:346–356. ! Van Straaten, P. (1986) Some aspects of the geology of carbonatites in SW. Tanzania. 1986 joint annual meeting
of GAC, MAC and CGU. Program with Abstracts Geological Association of Canada; Mineralogical Association of Canada; Canadian Geophysical Union, Joint Annual Meeting. 11, Pages 140. 1986. Geological Association of Canada. Waterloo, ON, Canada
! Van Straaten, P. (1989) Nature, structural relationships of carbonatites from southwest, west Tanzania. In: Bell,
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K. (Ed), Carbonatites. Unwin Hyman, London, 177-199 ! Van Wambeke, L. 1977. The Karonge rare earth deposits, Republic of Burundi: New mineralogical-geochemical
data and origin of the mineralization. Mineralium Deposita 12:373–380. ! Vlasov, K.A., M.V. Kuz’menko, and Y.M. Yes’kova. 1966. The Lovozero Alkali Massif. New York: Hafner. ! Wakita, H., P. Rey, and R.A. Schmitt. 1971. Abundances of the 14 rare earth elements and 12 other elements in
Apollo 12 samples. Pages 1319–1329 in Proceedings of the Second Lunar Science Conference. Edited by A.A. Levinson. Cambridge, MA: MIT Press.
! Wall, and C.T. Williams. Mineralogical Society Series 7.London: Chapman and Hall. ! Wall, F., and A.N. Mariano. 1996. Rare earth minerals in carbonatites: A discussion centred on the Kangankunde
carbonatite, Malawi. Pages 193–225 in Rare Earth Minerals: Chemistry, Origin, and Ore Deposits. Edited by A.P. Jones, F. Wall, and C.T. Williams. Mineralogical Society Series 7. London: Chapman and Hall.
! Welch, B.K., J. Sofoulis, and A.C.F. Fitzgerald. 1975. Mineral sand deposits of the Capel area, W.A. Pages 1070–1088 in Economic Geology of Australia and Papua New Guinea. I: Metals. Monograph 5. Parkville, Victoria: Australasian Institute of Mining and Metallurgy.
! Wilkinson. Reno: Geological Society of Nevada. ! Williams, G.J. (1939) The kimberlite province and associated diamond deposits of Tanganyika Territory. Geol.
Surv. Tanganyika. Bull. 12 ! Williams, G.J. and Eades, N.W. (1939) Explanation of the geology of degree sheet No. 18 (Shinyanga) Geol.
Surv. Tanganyika. Bull. 13 ! Williamson Diamond Mine, Mwadui (1964) Diamond Atlas of Tanzania ! Williamson Diamonds Limited (1976) Final Report on Diamond Prospecting 1959-1976. ! Willis, M. 2002. A mountain of rare potential. Industrial Minerals 415:63–65. ! Woodzick, T.L. and McCallum, M.E. (1984) A teledetective study of kimberlite regions in North America
(Colorado-Wyoming), East Africa (Mwadui), Siberia (Mir). In: Kimberlites, Related Rocks. Elsevier, Amsterdam, 5-20
! Woolley, A.R. 1987. Alkaline Rocks and Carbonatites of the World. Part 1: North and South America. Austin: University of Texas Press.
! Wu, C., Z. Yuan, and G. Bai. 1996. Rare earth deposits in China. Pages 281–310 in Rare Earth Minerals: Chemistry, Origin, and
! www.allafrica.com (2006) Diamond Plant in Offing. East African Business Week (Kampala) July 10, 2006. ! www.debeersgroup.com (2006) Various pages specific to Williamson Diamond Mine and Tanzania ! www.douglaslakeminerals.com/news/2006-dec12.html (2006) 80 Carat Diamond Discovered on Douglas lake
Minerals’ Newly Acquired Magembe Property – Directly Adjacent to De Beer’s Williamson Mine. ! Yahrbuch Mineralogie H. 2:67–70. 1990. Rare earth element mineralisation within the Mt. Weld carbonatite
laterite, Western Australia. Lithos 2:151–167. ! Yuan, Z., G. Bai, C. Wu, Z. Zhang, and X. Ye. 1992. Geological features and genesis of the Bayan Obo REE ore
deposit, Inner Mongolia, China. Applied Geochemistry 7:429–442.
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7.0!Glossaryof!Technical!Terms!and!Abbreviations!
Aeromagnetic A survey made from the air for the purpose of recording magnetic Survey characteristics of rocks. Alluvial Transported and deposited by water. Anomaly Value higher or lower than the expected or norm. Base metal Generally a metal inferior in value to the precious metals, eg. copper,
lead, zinc, nickel. Complex An assemblage of rocks or minerals intricately mixed or folded together. Conformable Beds deposited upon one another in uninterrupted sequence. Conglomerate Sedimentary rock formed by the cementing together of rounded water-
worn pebbles, distinct from breccia. Diamond drill Rotary drilling using diamond impregnated bits, to produce a solid
continuous core sample of the rock. Dip The angle at which a rock layer, fault of any other planar structure is
inclined from the horizontal. Dyke A tabular intrusive body of igneous rock that cuts across bedding at a
high angle. Fault A fracture in rocks on which there has been movement on one of the
sides relative to the other, parallel to the fracture. Felsic Descriptive of an igneous rock which is predominantly of light coloured
minerals (antonym: of mafic). Fine Ounce Equal to 31.1035 grams of gold. Footwall Rocks underlying mineralisation . Geochemistry Study of variation of chemical elements in rocks or soils. Geochemical The systematic study of the variation of chemical elements in rocks survey
and soil. Granite A coarse grained igneous rock consisting essentially of quartz and more
alkali feldspar than plagioclase. Intercept The length of rock or mineralisation traversed by a drillhole. JORC Joint Ore Reserves Committee- Australasian Code for Reporting of
Identified Resources and Ore Reserves. Laterite A red, residual soil, cemented in place, containing iron and aluminium
oxides but leached of quartz. Magnetic Systematic collection of readings of the earth's magnetic field. Survey Mineralisation In economic geology, the introduction of valuable elements into a rock
body.Ore A mixture of minerals, host rock and waste material which is expected to
be mineable at a profit. Outcrop The surface expression of a rock layer (verb: to crop out). Palaeochannel A drainage channel of the geological past which may be buried. Palaeozoic A time period from approximately 590 to 225 million years ago.
Porphyry A rock with conspicuous crystals in a fine-grained ground mass. Primary Mineralisation which has not been affected by near surface mineralisation
oxidising process. Proterozoic The geological age after Archaean, approximately 570 to 2400 million
years ago. Quartz A very common mineral composed of silicon dioxide-SiO2.Quaternary A division of geological time ranging between 1.8 million years and the
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present. . RAB Rotary Air Blast (as related to drilling)—A drilling technique in which the
sample is returned to the surface outside the rod string by compressed air.
RC Reverse Circulation (as relating to drilling)—A drilling technique in which the cuttings are recovered through the drill rods thus minimising sample losses and contamination.
Recent Geological age from about 20,000 years ago to present (synonym: Holocene).
Reconnaissance A general examination or survey of a region with reference to its main features, usually as a preliminary to a more detailed survey.
Remote Sensing Geophysical data obtained by satellites processed and presented Imagery as photographic images in real or false colour combinations. Reserve In-situ mineral occurrence which has had mining parameters
applied to it, from which valuable or useful minerals may be recovered.
Resource In-situ mineral occurrence from which valuable or useful minerals may be recovered, but from which only a broad knowledge of the geological character of the deposit is based on relatively few samples or measurements.
Sandstone A cemented or otherwise compacted detrital sediment composed predominantly of quartz grains.
Shear (zone) A zone in which shearing has occurred on a large scale so that the rock is crushed and brecciated.
Stratigraphy The succession of superimposition of rock strata. Composition, sequence and correlation of stratified rock in the earth’s crust.
Strike The direction or bearing of the outcrop of an inclined bed or structure on a level surface.
Stringer A narrow vein or irregular filament of mineral traversing a rock mass. Subcrop The surface expression of a mostly concealed rock layer. Syncline A fold where the rock strata dip inwards towards the axis (antonym:
anticline). Ultrabasic Igneous rocks with very high magnesium and iron content rocks containing less than 45% silicon dioxide. Ultramafic Synonymous with ultrabasic. Unconformable Descriptive of rocks on either side of an unconformity. Unconformity Lack of parallelism between rock strata in sequential contact, caused by
a time break in sedimentation. Vein A narrow intrusive mineral body. Volcanic Relating to the eruption of a volcano. Volcanic Describes clastic fragments of volcanic origin.
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CHEMICAL SYMBOLS
Ag Silver As Arsenic Au Gold Cu Copper Mn Manganese Mo Molybdenum Ni Nickel Pb Lead Zn Zinc
ABBREVIATIONS
cm centimetre g gram g/t gram per tonne ha hectare kg kilogram km kilometre km2 square kilometre m metre m2 square metre m3 cubic metre mm millimetre M million t tonne oz troy ounce, equivalent to 31.1035g.
UNITS OF CONCENTRATION
ppb parts per billion ppm parts per million
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Appendix!1!"REE!and!Diamond!Tenement!Schedule!in!Tanzania!
Nzega Project (100% - All minerals excluding gold)
Lease Lease Name
Lease Status
Area Application/ Grant Date
Expiry Date Project Registered Holder
HQ-P21632 Matinje Application 46.01 28/04/2010 Matinje Mabangu Exploration Ltd
PL4282/2007 Matinje East Granted 45.09 12/04/2007 11/04/2012 Matinje Mabangu Mining Limited
HQ-P21549 Matinje East 2 Application 45.35 12/04/2010 Matinje Mabangu Exploration Ltd
PL6219/2009 Matinje 3 Granted 46.25 31/12/2009 30/12/2012 Matinje Mabangu Mining Limited
PL 6749/2010 Isaka North 3 Granted 12.85 21/10/2010 20/10/13 Isaka Mabangu Mining Limited
HQ-P19723 Upper Isaka
North 1 Application 12.85 16/12/2008 Isaka Resolute Tanzania Limited
HQ-P20840 Isaka North Application 12.72 5/10/2009 Isaka Mabangu Mining Limited
PL3798/2005 Upper Isaka
North Granted 12.78 16/12/2005 15/12/2012 Isaka Mabangu Mining Limited
HQ-P20377 Kisia North Application 58.21 19/05/2009 Igunga Resolute Tanzania Limited
PL3962/2006 Kisia Granted 26.23 19/05/2006 18/05/2013 Igunga Sixnatha Privatus Jullu
HQ-P24261 Kisia East Application 53.19 08/09/2011 Igunga Resolute (Tanzania) Limited
HQ-P24262 Kisia West Application 53.82 08/09/2011 Igunga Resolute (Tanzania) Limited
PL6243/2009 Mwashimba Granted 24.69 31/12/2009 30/12/2012 GP Mabangu Mining Limited
PL6332/2010 Mwashimba 4 Granted 26.01 31/12/2010 30/03/2013 GP Mabangu Mining Limited
Mbeya Project (100%)
Lease Lease Name
Lease Status
Area Grant Date Expiry Date Project Registered Holder
PL5613/2008 Mbalizi South Granted 67.92 31/12/2008 30/12/2011 Mbeya Mr Marko Kishiga
PL 6103/2009 Mbalizi Granted 40.51 11/09/2009 08/11/2012 Mbeya Mr Marko Kishiga
Mwanga Project (100%)
Lease Lease Name
Lease Status
Area Grant Date Expiry Date Project Registered Holder
PL6100/2009 Mwanga Application 165.28 31/12/2009 30/12/2011 Mwanga Gobbex Limited
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5. FINANCIAL INFORMATION
The historical financial information of the Company for the three most recent financial years is set
out below. The Directors are responsible for the preparation and inclusion of this historical financial
information.
The historical financial information is presented in an abbreviated form and does not contain all the
disclosures that are usually contained in an annual report prepared in accordance with the
Corporations Act 2001. The historical financial information has been prepared in accordance with
Australian Accounting Standards.
Copies of the Company’s complete audited annual financial reports may be found on the Company’s
website at http://www.tabora.com.au/.
Past financial performance is not a guide to future performance.
Audited Statement of Financial Position
30 June
2011
30 June
2010
30 June
2009
$ $ $
ASSETS
Current assets
Cash and cash equivalents 244,300 3,537 2,568
Receivables 4,943 16,785 40,340
Total current assets 249,243 20,322 42,908
Non current assets
Property plant & equipment - - 261
Mining & deferred exploration assets 1,751,596 1,700,000 1,700,000
Other financial assets 63,754 135,118 50,000
Total non current assets 1,815,350 1,835,118 1,750,261
Total assets 2,064,593 1,855,440 1,793,169
LIABILITIES
Current liabilities
Payables 91,587 25,926 1,789,587
Total current liabilities 91,587 25,926 1,789,587
Total liabilities 91,587 25,926 1,789,587
Net assets 1,973,006 1,829,514 3,582
EQUITY
Contributed equity 13,499,353 12,943,353 11,294,972
Reserves 31,857 103,220 (22,512)
Accumulated losses (11,558,204) (11,217,059) (11,268,878)
Total equity 1,973,006 1,829,514 3,582
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Audited Statement of Comprehensive Income
30 June
2011
30 June
2010
30 June
2009
$ $ $
Continuing Operations
Interest revenue 351 1,163 490
Net Rent - 8,599 1,410
Gain on sale of Plant & Equipment - 6,373 -
Sundry income - 49,439 -
351 65,574 1,900
Expenses:
Foreign exchange gain/loss 158 (10,968) (10,999)
Employee benefits expenses (317,328) (14,896) (2,488)
Accommodation & travel - (5) -
Legal & Consultancy (10,136) (7,538) (353,165)
Communications (1,459) (46) (3,953
Depreciation and amortisation expenses - - (306)
Postage, Printing & stationary (3,675) (498) (414)
Impairment of Assets - 5,633 (89,841)
Other (9,013) 14,481 (82,029)
Gain/(Loss) before finance costs and income
tax (341,102) 51,737 (541,255)
Finance costs (43) 82 (92,826)
Gain/(Loss) before income tax (341,145) 51,819 (634,081)
Income Tax Expense - - -
Gain/(Loss) from continuing operations (341,145) 51,819 (634,081)
Other comprehensive income, after tax of nil (71,363) 103,220 -
Total comprehensive income for the year (412,508) 155,039 (634,081)
Updated financial information for the three months to 30 September 2011 can be found in the
unaudited Condensed Statements of Comprehensive Income and Condensed Statements of Financial
Position in the Investigating Accountants Report in Section 5.
Material Historical Financial Matters
In September 2009 a restabilisation of the Company was undertaken, involving the conversion of
outstanding debt to equity under a deed of compromise and release
The audit report on the financial report for each on the financial years ended 30 June in 2009, 2010
and 2011 noted that the ability of the Company to continue as a going concern is subject to the
successful recapitalisation of the Company by way of a capital raising and/or the sale of the
company's investments and/or mineral tenement interests at sufficient amounts so the Company
can meet its existing and future commitments and proposed expenditures.
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6. INVESTIGATING ACCOUNTANT’S REPORT
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Liability limited by a scheme approved under Professional Standards Legislation
LEVEL 2, 1 WALKER AVENUE
WEST PERTH WA 6005, AUSTRALIA
PH: 61 8 9481 3188 • FAX: 61 8 9321 1204
www.stantons.com.au
19 January 2012
The DirectorsTabora Limited 338 Hay Street SUBIACO WA 6008
Dear Sirs
RE: INVESTIGATING ACCOUNTANT'S REPORT
1. Introduction
This report has been prepared at the request of the Directors of Tabora Limited (“Tabora” or “the Company”) for inclusion in a Prospectus to be dated on or around 20 January 2012 (“the Prospectus”) relating to the proposed issue by Tabora of 25,000,000 shares to be issued at a price of 20 cents per share to raise a gross $5,000,000.
2. Basis of Preparation
This report has been prepared to provide investors with information on the unaudited historical results, the unaudited condensed statement of financial position (balance sheet) of Tabora and the unaudited pro-forma statement of financial position of Tabora as noted in Appendix 2. The historical and pro-forma financial information is presented in an abbreviated form, insofar as it does not include all of the disclosures required by Australian Accounting Standards applicable to annual financial reports in accordance with the Corporation Act 2001. This report does not address the rights attaching to the securities to be issued in accordance with the Prospectus, nor the risks associated with the investment. Stantons International Securities has not been requested to consider the prospects for Tabora, the securities on offer and related pricing issues, nor the merits and risks associated with becoming a shareholder and accordingly, has not done so, nor purports to do so. Stantons International Securities accordingly takes no responsibility for those matters or for any matter or omission in the Prospectus, other than responsibility for this report. Risk factors are set out in Section 3 of the Prospectus.
3. Background
Tabora was incorporated on 14 November 2003 as Redox Diamonds Pty Ltd and altered its constitution in March 2004 and changed its name to Redox Diamonds Limited and in November 2010 shareholders approved a change of name to Redox Minerals Limited. In April 2011, the Company changed its name to Tabora Limited.
The Company has over the years traded as a mineral explorer in Tanzania and Australia. Since incorporation and to 30 June 2010, the Company had issued a total of 284,560,145 shares and the issued capital was $12,943,353 (including after issuing 164,788,053 shares under a Deed of Compromise and issuing 50,000,000 shares for provision of services in 2009). In April 2011, the Company reconstructed its share capital on a 1 for 10 basis so that the 284,560,145 shares became 28,455,900 shares (due to rounding).
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In April 2011, the Company issued 3,700,000 post consolidated shares in lieu of cash to acquit director and consultants fees totalling $296,000. In June 2011, the Company issued 3,250,000 post reconstructed shares at 8 cents each to new investors to raise a gross $260,000. The number of shares on hand as at 30 June 2011 is 35,405,990.
The Company has an agreement (“RA”) with Resolute (Tanzania) Limited, Mabangu Mining Limited and Mabangu Exploration Limited (all subsidiaries of Resolute Mining Limited) (collectively “Resolute”) for the Company to acquire the mineral rights (other than gold) over certain tenements in Tanzania and known as the Nzega Project. The consideration payable includes the issue of such number of shares in Tabora that the relevant interest of Resolute Mining Limited immediately following listing on the ASX represents that number which is closest to but not more than 20% of the issued capital of the Company (Consideration Shares”) and the issue of a convertible note with a principal of $274,316 (Convertible Note”). The number of Consideration Shares to be issued in the event that the $5,000,000 is raised would be approximately 13,729,917 as Resolute has a relevant interest in 1,097,264 shares in the Company. The Convertible Note is to be interest free, repayable in cash on 31 December 2012 or convertible by Resolute into shares in Tabora at 20 cents each, subject to shareholder approval where necessary (up to 1,371,580 shares may be issued to Resolute by Tabora if Resolute chooses to convert the Convertible Note in full). The RA is, inter alia, subject to the Company raising a minimum of $5,000,000 through an initial public offering and being admitted to the Official List by 21 April 2012.
The Company has a beneficial interest in two other Tanzanian projects, namely the Mbeya Project and the Mwanga Project. The relevant tenements of the Mbeya Project are held in trust for Tabora.
The Company also owns 607,177 shares (escrowed to November 2012) in BrazIron Limited, an ASX listed company and owns 182,609 shares in an unlisted company, Majestic Diamonds and Metals Inc that has interests in Brazil.
The Company has entered into an employment agreement with Roland Hill for a three year period at the rate of $180,000 per annum plus statutory superannuation, effective from 13 June 2011. The salary is to be reviewed annually. The salary accrues to 31 December 2011 and these accrued salaries and further remuneration shall not accrue or become payable until the Company is admitted to the Official List of the ASX. However, the employment agreement is terminable by either party on the giving of three months notice (other termination conditions may also apply).
The Company has also entered into letter agreements with Stephan Meyer and Andrew Spinks effective 13 June 2011 to act as non executive directors of Tabora. The annual director fees are $50,000 for Stephan Meyer and $40,000 for Andrew Spinks and the initial term is for a period of three years. The Company has also entered into a letter agreement with Bradford Farrell effective 5 August 2011 to act as a non executive director of Tabora. The annual director fees payable to Bradford Farrell are $40,000 and the initial term is for a period of three years. The fees accrue to 31 December 2011. The accrued amount and further remuneration shall not accrue or become payable until the Company is admitted to the Official List of the ASX.
The Company has an employment agreement with Robert Hodby to provide company secretarial services and act as the chief financial officer for a three year term effective from 13 June 2011 at the rate of $150,000 per annum plus statutory superannuation (reviewed annually). The salary accrues to 31 December 2011 and these accrued salaries and further remuneration shall not accrue or become payable until the Company is admitted to the Official List of the ASX. However, the employment agreement is terminable by either party on the giving of three months notice (other termination conditions may also apply).
Potential investors should read the Prospectus in full that includes an Independent Geologist’s Report and a Solicitor’s Report on Tenements. We make no comments as to ownership or values of the proposed mineral tenement interests of Tabora. Further details on all significant contracts entered into by the Company are referred to in the Material Contracts Section 8 included in the Prospectus.
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4. Scope of Examination
You have requested Stantons International Securities to prepare an Investigating Accountant’s Report on:
a) The results (statement of comprehensive income) of Tabora for the year ended 30 June 2011 and the three months ended 30 September 2011;
b) The statement of financial position of Tabora as at 30 September 2011; and c) The consolidated pro-forma statement of financial position of Tabora at 30 September 2011
adjusted to include funds to be raised by the Prospectus and the completion of transactions referred to in note 2 of Appendix 3.
All of the financial information referred to above has not been audited however has been subject to audit review. The directors of Tabora are responsible for the preparation and presentation of the historical and pro-forma financial information, including the determination of the pro-forma transactions. We have however examined the financial statements and other relevant information and made such enquiries, as we considered necessary for the purposes of this report. The scope of our examination was substantially less than an audit examination conducted in accordance with Australian Auditing Standards and accordingly, we do not express such an opinion. Our examination included:
a) discussions with directors and other key management of Tabora; b) review of contractual arrangements; c) a review of publicly available information; and d) a review of work papers, accounting records and other documents.
5. Opinion
In our opinion, the pro-forma consolidated statement of financial position as set out in Appendix 2 presents fairly, the pro-forma consolidated statement of financial position of Tabora as at 30 September 2011 in accordance with the accounting methodologies required by Australian Accounting Standards on the basis of assumptions and transactions set out in Appendix 3. No opinion is expressed on the historical results and statements of financial position, as shown in Appendix 1, except to state that nothing has come to our attention which would require any further modification to the financial information in order for it to present fairly, the statements of financial position as at 30 September 2011 and the results of the period identified.
To the best of our knowledge and belief, there have been no other material items, transactions or events subsequent to 30 September 2011 that have come to our attention during the course of our review which would cause the information included in this report to be misleading.
6. Other Matters
At the date of this report, Stantons International Securities or Stantons International Audit and Consulting Pty Ltd (“Stantons International”) (the auditors of Tabora) do not have any shareholding interest in Tabora either directly or indirectly, or in the outcome of the Offer. Stantons International Securities and Stantons International were not involved in the preparation of any other part of the Prospectus, and accordingly, make no representations or warranties as to the completeness and accuracy of any information contained in any other part of the Prospectus. Stantons International Securities consents to the inclusion of this report (including Appendices 1 to 3) in the Prospectus in the form and content in which it is included. At the date of this report, this consent has not been withdrawn. Yours faithfully STANTONS INTERNATIONAL SECURITIES
J P Van Dieren - FCA Director
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INVESTIGATING ACCOUNTANT’S REPORT
APPENDIX 1 – CONDENSED STATEMENTS OF COMPREHENSIVE INCOME
Tabora Ltd 3 months ended
30 September 2011 (Unaudited)
$
Tabora Ltd 12 months ended
30 June 2011 (audited)
$Interest income 726 351 Employee benefit expenses (248,460) (296,006) General and administration costs (5,329) (19,192) Communications (1,375) (1,459) Postage, printing and stationary (856) (3,675) Net (loss) before tax (255,294) (319,981) Income tax expense attributable to net loss - - Net (loss) after tax (255,294) (319,981) Other Comprehensive Income (Loss) - - Total Comprehensive (Loss) for the period (255,294) (319,981)
APPENDIX 2 – UNAUDITED CONDENSED STATEMENTS OF FINANCIAL POSITION
Note Tabora Ltd 30 September
2011 $
Pro-forma Tabora Ltd
30 September 2011
$Current Assets Cash assets 3 241,676 4,252,603 Receivables and prepayments 4 3,721 3,721 Total Current Assets 245,397 4,256,324
Non Current Assets Capitalised acquisition costs 5 1,756,254 4,796,554 Investments 6 63,754 42,502 Total Non Current Assets 1,820,008 4,839,056 Total Assets 2,065,405 9,095,380
Current Liabilities Trade and other payables 7 71,694 - Accrued expenses 7 282,794 - Related party loans 7 21,451 - Convertible Notes 7 - 274,316 Total Current Liabilities 375,939 274,316 Net Assets 1,689,466 8,821,064
Equity Issued capital 8 13,471,108 20,768,958 Reserves 9 31,856 10,604 Accumulated losses 10 (11,813,498) (11,958,498) Total Equity 1,689,466 8,821,064
Condensed notes forming part of the above statements are set out in Appendix 3.
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INVESTIGATING ACCOUNTANT’S REPORT
APPENDIX 3
CONDENSED NOTES TO THE UNAUDITED CONDENSED STATEMENT OF COMPREHENSIVE INCOME AND CONDENSED STATEMENTS OF FINANCIAL POSITION
1. Statement of Significant Accounting Policies
(a) Basis of Accounting The unaudited condensed Statement of Comprehensive Income and unaudited
condensed Statements of Financial Position have been prepared in accordance with applicable accounting standards, the Corporations Act 2001 and mandatory professional reporting requirements in Australia (including the Australian equivalents of International Financial Reporting Standards) and we have made such disclosures as considered necessary. They have also been prepared on the basis of historical cost and do not take into account changing money values. The accounting policies have been consistently applied, unless otherwise stated. The financial statements have been prepared on a going concern basis that is dependent on the IPO being successful and/or the Company raising additional seed capital to continue in business.
(b) Income Tax The charge for current income tax expense is based on the profit for the year adjusted for any non assessable or disallowed items. It is calculated using tax rates that have been enacted or are substantially enacted as at balance date. Deferred tax is accounted for using the balance sheet liability method in respect of temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the financial statements. No deferred income tax will be recognised from the initial recognition of an asset or liability, excluding a business combination, where there is no effect on accounting or taxation profit or loss. Deferred income tax assets are recognised to the extent that it is probable that the future tax profits will be available against which deductible temporary differences will be utilised. The amount of the benefits brought to account or which may be realised in the future is based on the assumption that no adverse change will occur in the income taxation legislation and the anticipation that the economic unit will derive sufficient future assessable income to enable the benefits to be realised and comply with the conditions of deductibility imposed by law.
(c) Exploration, Evaluation and Development Expenditure Exploration, evaluation and acquisition expenditure on areas of interest are normally
expensed as incurred except they may be carried forward as an item in the Statement of Financial Position where right of tenure of the area of interest is current and they are expected to be recouped through sale or successful development and exploitation of the area of interest or, where exploration and evaluation activities in the area of interest have not yet reached a stage that permits reasonable assessment of the existence of economically recoverable reserves. When an area of interest is abandoned or the directors decide that it is not commercial, any accumulated acquisition costs in respect of that area are written off in the financial period the decision is made. Each area of interest is also reviewed at the end of each accounting period and accumulated costs written off to the extent that they will not be recoverable in the future. Where projects have advanced to the stage that directors have made a decision to mine, they are classified as development properties. When further development expenditure is incurred in respect of a development property, such expenditure is carried forward as part of the cost of that development property only when substantial future economic benefits are established. Otherwise such expenditure is classified as part of the cost of production or written off where production has not commenced.
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(d) Plant and Equipment Each class of property, plant and equipment is carried at cost or fair value, less where applicable, any accumulated depreciation and impairment losses. The carrying amount of the plant and equipment is reviewed annually by the Directors to ensure it is not in excess of the recoverable amount of these assets. The recoverable amount is assessed on the basis of the expected net cash flows that will be received from the assets employed and their subsequent disposal. The expected net cash flows have been discounted to their present value in determining recoverable amounts.
Depreciation The depreciable amount of all fixed assets including buildings and capitalised leased assets, but excluding freehold land, is depreciated on a straight line basis over their useful lives to the Company commencing from the time the asset is held ready for use. The asset’s residual value and useful lives are reviewed and adjusted if appropriate, at each balance sheet date.
An assets’ carrying value is written down immediately to its recoverable amount if the asset’s carrying value is greater than the estimated recoverable amount. Gains and losses on disposal are determined by comparing proceeds with the carrying amount. These gains and losses are included in the income statement.
(e) Trade and other accounts payable Trade and other accounts payable represent the principal amounts outstanding at
balance date, plus, where applicable, any accrued interest.
(f) Recoverable Amount of Non Current Assets The carrying amounts of non-current assets are reviewed annually by directors to
ensure they are not in excess of the recoverable amounts from those assets. The recoverable amount is assessed on the basis of the expected net cash flows, which will be received from the assets employed and subsequent disposal. The expected net cash flows have been or will be discounted to present values in determining recoverable amounts.
(g) Operating Revenue Revenue represents interest received and reimbursements of exploration
expenditures.
(h) Issued Capital Ordinary Shares are classified as equity. Incremental costs directly attributable to the issue of new shares or options are
shown in equity as a deduction, net of tax, from the proceeds. Incremental costs directly attributable to the issue of new shares or options, or for the acquisition of a business, are included in the cost of the acquisition as part of the purchase consideration.
(i) Employee benefits Provision is made for employee benefits accumulated as a result of employees rendering services up to the reporting date. These benefits include wages and salaries, annual leave, and long service leave.
Liabilities arising in respect of wages and salaries, annual leave and any other employee benefits expected to be settled within twelve months of the reporting date are measured at their nominal amounts based on remuneration rates which are expected to be paid when the liability is settled. All other employee benefit liabilities are measured at the present value of the estimated future cash outflow to be made in respect of services provided by employees up to the reporting date. In determining the present value of future cash outflows, the market yield as at the
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reporting date on national government bonds, which have terms to maturity approximating the terms of the related liability, are used.
(j) Share Based Payments The Company provides benefits to employees (including directors) of the Company in the form of share-based payment transactions, whereby employees render services in exchange for shares or rights over shares (“equity-settled transactions”). The cost of these equity-settled transactions with employees is measured by reference to the fair value at the date at which they are granted. The fair value is determined by an internal valuation using Black-Scholes or Binomial option pricing models.
The cost of equity-settled transactions is recognised, together with a corresponding increase in equity, over the period in which the performance conditions are fulfilled, ending on the date on which the relevant employees become fully entitled to the award (“vesting date”). The cumulative expense recognised for equity-settled transactions at each reporting date until vesting date reflects (i) the extent to which the vesting period has expired and (ii) the number of awards that, in the opinion of the directors of the Group, will ultimately vest. This opinion is formed based on the best available information at balance date. No adjustment is made for the likelihood of market performance conditions being met as the effect of these conditions is included in the determination of fair value at grant date.
No expense is recognised for awards that do not ultimately vest, except for awards where vesting is conditional upon a market condition. Where an equity-settled award is cancelled, it is treated as if it had vested on the date of cancellation, and any expense not yet recognised for the award is recognised immediately. However, if a new award is substituted for the cancelled award, and designated as a replacement award on the date that it is granted, the cancelled and new award are treated as if they were a modification of the original award.
(k) Critical accounting estimates and judgements In preparing Financial Reports, the Company has been required to make certain estimates and assumptions concerning future occurrences. There is an inherent risk that the resulting accounting estimates will not equate exactly with actual events and results.
Significant accounting judgements In the process of applying the Group’s accounting policies, management has made the following judgements, apart from those involving estimations, which have the most significant effect on the amounts recognised in the financial statements:
Capitalisation of exploration and evaluation expenditureThe Company has capitalised significant exploration, evaluation and acquisition expenditure on the basis either that this is expected to be recouped through future successful development (or alternatively sale) of the Areas of Interest concerned or on the basis that it is not yet possible to assess whether it will be recouped.
Significant accounting estimates and assumptions The carrying amounts of certain assets and liabilities are often determined based on estimates and assumptions of future events. The key estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of certain assets and liabilities within the next annual reporting period are:
Impairment of capitalised exploration and evaluation expenditureThe future recoverability of capitalised acquisition expenditure is dependent on an number of factors, including whether the Company decides to exploit the related lease itself, or, if not, whether it successfully recovers the related exploration and
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evaluation asset through sale. Factors that could impact the future recoverability include the level of reserves and resources, future technological changes, costs of drilling and production, production rates, future legal changes (including changes to environmental restoration obligations) and changes to commodity prices.
(l) Investments and other financial assets The Company classifies its investments in the following categories: financial assets at fair value through profit and loss, loans and receivables, held-to-maturity investments and available-for-sale financial assets. The classification depends on the purpose for which the investments were acquired. Management determines the classification of its investments at initial recognition and, in the case of assets classified as held-to-maturity, re-evaluates this designation at each reporting date.
Financial assets at fair value through profit and loss Financial assets at fair value through profit and loss are financial assets held for trading. A financial asset is classified in this category if acquired principally for the purpose of selling in the short term. Assets in this category are classified as current assets.
Loans and receivables Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market. They are included in current assets, except for those with maturities greater than 12 months after the balance sheet date which are classified as non-current assets. Loans and receivables are included in trade and other receivables in the statement of financial position.
Held-to-maturity investments Held-to-maturity investments are non-derivative financial assets with fixed or determinable payments and fixed maturities that the Company’s management has the positive intention and ability to hold to maturity. Held-to-maturity investments are included in non-current assets, except for those with maturities less than 12 months from the reporting date, which are classified as current assets.
Available-for-sale financial assets Available-for-sale financial assets, comprising principally marketable equity securities, are non-derivatives that are either designated in this category or not classified in any of the other categories. They are included in non-current assets unless management intends to dispose of the investment within 12 months of the statement of financial position date.
Recognition and derecognition Regular purchases and sales of financial assets are recognised on trade date – the date on which the Company commits to purchase or sell the asset. Investments are initially recognised at fair value plus transaction costs for all financial assets not carried at fair value through profit or loss. Financial assets carried at fair value through profit or loss are initially recognised at fair value and transaction costs are expensed to the statement of financila performance. Financial assets are derecognised when the rights to receive cash flows from the financial assets have expired or have been transferred and the Company has transferred substantially all the risks and rewards of ownership.
When securities are classified as available-for-sale are sold, the accumulated fair value adjustments recognised in equity are included in the statement of financial performance as gains and losses from investment securities.
Subsequent measurement Loans and receivables and held-to-maturity investments are carried at amortised cost using the effective interest method. Available-for-sale financial assets at fair value through profit or loss are subsequently carried at fair value. Gains or losses arising from changes in the fair value of the “financial assets at fair value through profit or loss” category are presented in the income statement within other income
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or other expenses in the period in which they arise. Income from financial assets at fair value through profit and loss is recognised in the income statement as part of income from continuing operations when the Group’s right to receive payment is established.
(m) Asset retirement obligations The Company’s mineral exploration and development activities are subject to various Australian laws and regulations regarding the protection of the environment. As a result of these, the Group is expected to incur expenses from time to time to discharge its obligations under these laws and regulations.
Reclamation and closure costs are estimated based on the Group’s interpretation of current regulatory and operating licence requirements and measured at fair value. Fair value is determined based on the net present value of future cash expenditures expected upon reclamation and closure and subsequent annual recognition of an accretion amount on the discounted liability. Reclamation and closure costs are capitalised as mine development costs and amortised over the life of the mine on a unit-of-production basis.
2 Actual and Proposed Transactions to Arrive at Pro-forma Unaudited Statement of
Financial Position of Tabora
Actual and proposed transactions adjusting the 30 September 2011 unaudited condensed Statement of Financial Position of Tabora in the pro-forma Statement of Financial Position of Tabora are as follows:
(a) The issue of 25,000,000 shares at 20 cents each to raise a gross $5,000,000 pursuant to the Prospectus;
(b) The issue of 13,729,917 shares to Resolute to acquire mineral rights (excluding gold) on certain tenements in Tanzania (deemed cost of $2,745,984) and the issue a Convertible Note with a face value of $274,316 to Resolute;
(c) The payment of 30 September 2011 accounts payable of $71,694, accrued expenses of $282,794 and loans of $21,451;
(d) The payment of cash expenses of the Prospectus issue totalling an estimated $476,379 (less approximately $28,245 already incurred) and the expensing of such costs against share equity;
(e) The incurring of salary costs of an estimated $125,000 between 1 October 2011 and 31 December 2011 and say a further $20,000 in other costs to 28 February 2012;
(f) The incurring of acquisition costs on exercise of an option to acquire tenement of US$20,000 (assumed to equate to AUS$20,000); and
(g) The marking to market of the BrazIron Limited shares as at 30 September 2011 (write down of $21,252).
Note 2 Unaudited Tabora Ltd
30 September 2011
$
Unaudited Tabora
30 September 2011
$ 3. Cash Assets
The movements in cash assets are as follows: Unaudited 30 September 2011 241,676 241,676 Issue of shares pursuant to the Prospectus (a) - 5,000,000 Payment of payables (c) - (375,939) Prospectus issue costs (d) - (448,134) Administration costs (e) - (145,000) Option exercise costs (f) - (20,000) 241,676 4,252,603
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Note 2 Unaudited Tabora Ltd
30 September 2011
$
Unaudited Tabora
30 September 2011
$ 4. Receivables
GST receivable/other 3,721 3,721 3,721 3,721
5. Capitalised Acquisition Costs Costs carried as at 30 September 2011 1,756,254 1,756,254 Further acquisition costs (shares) (b) - 2,745,984 Further acquisition costs (Notes) (b) - 274,316 Exercise of Option (f) - 20,000 1,756,254 4,796,554
6. Investments Shares in unlisted company at 30 September 2011 market value - - Shares in ASX listed companies at 30 September 2011 market value (g) 63,754 42,502 Total Investments 63,754 42,502
7. Trade payables, accrued expenses, related party loans and Notes
Trade and other payables 71,694 71,694 Accrued Expenses 282,794 282,794 Loans 21,451 21,451 Convertible Note due to Resolute (refer
Note 11) (b) - 274,316 Less: Payment of payables, accrued
expenses and loans (c) - (375,939) 375,939 274,316
8. Issued Capital
Ordinary shares 35,405,990 shares as at 30 September 2011 13,471,108 13,471,108 25,000,000 shares pursuant to the Prospectus (a) - 5,000,000 13,729,917 shares at 20 cents each (b) - 2,745,984 13,471,108 21,217,092 Less: estimated share issue costs in 2012 (d) - (448,134) Pro-forma (74,135,907 ordinary shares) 13,471,108 20,768,958
9. Reserves Available for Sale Reserve Balance at 30 September 2011 31,856 31,856 Write down of investment (g) - (21,252)
31,856 10,604
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Note 2 Unaudited Tabora Ltd
30 September 2011
$
Unaudited Tabora
30 September 2011
$ 10. Accumulated Losses
Balance as at 30 September 2011 11,813,498 11,813,498 Administration costs (e) - 145,000 11,813,498 11,958,498
11. Contingent Liabilities and Commitments
Based on discussions with the Directors, to our knowledge, the Company has no other material commitment or contingent liabilities not otherwise disclosed in this Investigating Accountant’s Report (refer Background section 3) and in the Prospectus. Investors should read the Independent Geologist’s Report, the Solicitor’s Report on Tenements and the Material Contracts sections for further possible contingencies and commitments. A number of tenements may be subject to royalty payments on production of minerals and be subject to possible native title claims. For details on proposed exploration commitments on mineral tenements, refer to the Independent Geologist’s Report in section 4 the Prospectus and the Investment Overview and section 2 of the Prospectus. The Company is due to pay Resolute the sum of $274,316 (if not previously converted to shares in Tabora) in relation to an interest free Convertible Note due for repayment on 31 December 2012. Resolute has the option to convert the Convertible Note (when issued and subject to obtaining all necessary shareholder and regulatory approvals in relation to the issue of shares pursuant to a conversion of the Convertible Note if required) into ordinary shares in Tabora at 20 cents per share and thus potentially 1,317,580 shares may be issued to Resolute.
12. Rental Of Premises Commitments
The Company has not entered into a lease of premises agreement as at 30 September 2011 or as at 19 January 2012. The Company may seek to lease premises once it obtains an ASX listing.
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7. SOLICITOR’S REPORT ON TENEMENTS
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SCHEDULE 1
DETAILS OF MINING TENEMENTS INCLUDING RESULTS OF OFFICIAL SEARCHES
S/N
Application/
Licence Number Holder Status
Date granted
(Application date) Expiry date Area (km2) Location
Notes Project
1 HQ-P21632 Mabangu Exploration Limited Application (28/04/2010) - 45.78 Matinje/Igunga - Nzega (Matinje)
2 HQ-P21549 Mabangu Exploration Limited Application (12/04/2010) - 45.11 Matinje/Igunga - Nzega (Matinje)
3 HQ-P19723 Resolute (Tanzania) Limited Application (16/12/2008) - 12.78 Isaka North/Kahama - Nzega
4 HQ-P20840 Mabangu Mining Limited Application (05/10/2009) - 12.72 Isaka North/Kahama - Nzega
5 HQ-P20377 Resolute (Tanzania) Limited Application (19/05/2009) - 57.93 Iramba - Nzega
6 HQ-P24262 Resolute (Tanzania) Limited Application (08/09/2011) - 56.82 Kisia/Igunga/Iramba - Nzega
7 HQ-P24261 Resolute (Tanzania) Limited Application (08/09/2011) - 53.19 Kisia/Igunga/Iramba - Nzega
8
HQ-P16816
(PL 6749/2010) Mabangu Mining Limited Granted 21/10/2010 20/10/2013 12.85 Isaka North/Kahama - Nzega
9 PL 4282/2007 Mabangu Mining Limited Granted 12/04/2007 11/04/2012 44.86 Matinje/Igunga - Nzega (Matinje)
10 PL 6219/2009 Mabangu Mining Limited Granted 31/12/2009 30/12/2012 46.25 Matinje/Igunga - Nzega (Matinje)
11 PL 3798/2005 Mabangu Mining Limited Granted 16/12/2005 15/12/2012 12.78 Isaka North/Kahama - Nzega
12 PL 3962/2006 Sixnatha Privatus Jullu Granted 19/05/2006 18/05/2013 26.24 Igunga& Iramba - Nzega
13 PL 6243/2009 Mabangu Mining Limited Granted 31/12/2009 30/12/2012 24.69 Nzega 1 Nzega
14 PL 6332/2010 Mabangu Mining Limited Granted 31/03/2010 30/03/2013 26.01 Mwashimba/Nzega - Nzega
15 PL 5613/2008 Marko Kishiga Granted 31/12/2008 30/12/2011 67.92 Mbalizi South/Mbeya 2 Mbeya
16 PL 6103/2009 Marko Kishiga Granted 9/11/2009 8/11/2012 40.51 Mbalizi/ Mbeya - Mbeya
17 PLR 6100/2009 Gobbex Limited Granted 31/12/2009 30/12/2011 165.28 Same & Simanjiro 3 Mwanga
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Notes:
HQ-P = Prospecting Licence application
PL = Prospecting Licence
PLR = Prospecting Licence with a Reconnaissance Period
There is no provision in the Mining Act which would make the age of a prospecting licence application to have adverse impact on its likelihood of being granted. We are not aware of any reason, legal or otherwise, that would make the
applications not to be granted.
Rent is payable annually in advance within 90 days of the date of grant of the tenement and each anniversary thereafter at a rate of USD40 per km2
Minimum annual expenditure commitment is calculated at a rate of USD500 per km2
for the initial term, USD 2,000 per km2
for the first renewal period and USD 6,000 per km2
for the second renewal period.
There are no registered encumbrances in relation to any of the tenements in the above table.
All licences are granted for all minerals other than building materials and gemstones.
All applications are made for all minerals other than building materials and gemstones except HQ-P24261 and HQ-P24262 which specify the category of minerals applied for as Metallic Minerals.
1 Annual rent has not been paid for the year 2011/2012.
2 A first renewal application has been lodged to extend the term to 30/12/2014 but a decision is yet to be made.
3 A first renewal application has been lodged to extend the term to 30/12/2014 but a decision is yet to be made.
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8. MATERIAL CONTRACTS
8.1. Resolute Agreement – Nzega Project
On 21 January 2011, the Company entered into a conditional agreement with Resolute (Tanzania)
Limited (Company Number 30670), Mabangu Mining Limited (Company Number 26053) and
Mabangu Exploration Limited (Company Number 32208) (Vendors) to acquire 100% of the mineral
rights (excluding gold) on the Resolute Tenements which comprise the Nzega Project (the Non-Gold
Rights) and amended by letter of variation dated 21 July 2011, deed of amendment dated 12
December 2011 and letter of variation dated 21 December 2011 (Resolute Agreement).
The material terms of the Resolute Agreement are as follows:
(a) (Conditions precedent): The Resolute Agreement remains conditional upon the satisfaction
or waiver of the following conditions precedent:
(i) Capital raising: the Company completing a capital raising of not less than
$5,000,000; and
(ii) Admission to the official list of ASX: the Company being admitted to the official
list of ASX and being granted official quotation of its Shares,
on or before 21 April 2012 or a later date agreed by the parties.
(b) (Consideration): The Company will satisfy the consideration for the Non-Gold Rights
through:
(i) the issue of that number of Shares such that the relevant interest of Resolute
Mining Limited immediately following listing represents that number which is
closest to but not more than 20% of the issued share capital of the Company; and
(ii) the issue of the Convertible Note.
(c) (Funding): On and from 1 July 2011, the Company must contribute 50% of the charges
payable in respect of the Resolute Tenements (e.g. rent) and 50% of the minimum annual
expenditure commitment required under the mining legislation application to the Resolute
Tenements.
(d) (Sharing information): The Company and the Vendors agree to share technical data in
respect of the Resolute Tenements to each other.
(e) (Exploration): The Company and Vendors must use all reasonable endeavours to
accommodate the planned exploration of the other where both wish to simultaneously
explore the same portion of any Resolute Tenement.
(f) (Co-existence rights): If one or more feasibility studies prepared by a competent person (as
defined in the ASX Listing Rules) identifies either an ore body on one or more of the
Resolute Tenements which contains both economically recoverable quantities of gold and
non-gold minerals, or, two or more ore bodies, one of which contains an economically
recoverable quantity of gold and the other an economically recoverable quantity of non-
gold minerals, but both ore bodies cannot be simultaneously mined, the Company and the
Vendors must negotiate in good faith for 3 months to agree the most economic method by
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which both minerals can be mined. In the absence of agreement the Vendors have
priority.
(g) (Mining by the Company): Should the Company locate a deposit on the Resolute
Tenements that is identified in any feasibility study prepared by a competent person (as
defined in the ASX Listing Rules) as being economically viable to mine and the Company
wishes to mine that deposit then the Vendors must use all reasonable endeavours to
facilitate the Company obtaining tenure over the area of the Resolute Tenements which
the Company reasonably believes is necessary to undertake the proposed mining
operations.
(h) (Pre-emptive rights): the Company has a pre-emptive right over the future disposal of any
interest the Vendors has in the Resolute Tenements whether for consideration to a third
party or as a result of proposed surrender.
(i) (Warranties): The Resolute Agreement contains standard warranties and representations
on behalf of the parties typical for an agreement of this nature.
(j) (Other): The Resolute Agreement otherwise contains terms and conditions typical for an
agreement of this nature.
8.2. Convertible Note Deed
On 12 December 2011, the Company entered into a deed with Resolute (Treasury) Pty Ltd (ACN 120
794 603) (Noteholder) to issue a convertible note (Convertible Note) with a principal of $274,316
(Principal) to the Noteholder conditional on the settlement of the Resolute Agreement (Convertible
Note Deed).
The Convertible Note is to be issued to the holder on the following key terms and conditions:
(a) (General terms):
(i) (Unsecured) The Convertible Note is unsecured and the holder will rank equally with
all other unsecured creditors of the Company;
(ii) (Unlisted) The Company will not apply for quotation of the Convertible Note;
(iii) (No voting rights) The Convertible Note does not entitle the holder to vote at
shareholder meetings of the Company;
(iv) (No interest) No interest is payable on the Principal;
(v) (Non-transferable) The Noteholder shall not be permitted to transfer all or any part
of the Convertible Note unless prior written consent is given by the board of
directors of the Company;
(vi) (Information and reports) The Convertible Note confers on the holder the right to
receive copies of all documents of the Company that are circulated to Shareholders.
(b) (Conversion) The Convertible Note can be converted by the holder (if not previously
redeemed) from the date on which (1) all necessary Shareholder and regulatory approvals in
relation to the issue of Shares pursuant to a conversion of the Convertible Note are obtained
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(including item 7 of Section 611 of the Corporations Act) or (2) it is determined by both the
Company and Noteholder acting reasonably that no Shareholder or regulatory approvals are
required, until the day immediately preceding 31 December 2012 (Maturity Date). Shares
issued on conversion will be fully paid ordinary shares in the capital of the Company issued
on the same terms and conditions as the Company’s existing Shares as traded on ASX other
than any escrow restriction imposed by ASX.
(c) (Conversion price) Subject to paragraph (d), the Convertible Note will convert into that
number of Shares calculated by dividing the principal amount by $0.20.
(d) (Reconstruction) No adjustment will be made to the rights of the Convertible Note in the
event the issued capital of the Company is reconstructed during the currency of the
Convertible Note, unless required to be changed in a manner consistent with the
Corporations Act and the ASX Listing Rules at the time of the reconstruction.
(e) (Participating rights) There are no participation rights or entitlements inherent in the
Convertible Note and the Noteholder will not be entitled to participate in new issues of
capital offered to Shareholders during the currency of the Convertible Note without first
converting the Convertible Note prior to the date for determining entitlements to
participate in any such issue.
(f) (Redemption) The Convertible Note can be redeemed (if not previously converted):
(i) (By the Company) at any time between the date of issue and the Maturity Date;
(ii) (By the Noteholder): in the event the Company is in default under the
Convertible Note Deed (e.g. non-payment of interest, an event of insolvency); or
(iii) (Automatically) On the Maturity Date.
8.3. Mbeya Agreement
In February 2011 the Company acquired a 100% beneficial interest in two prospecting licences,
PL6103/2009 and PL5613/2008, comprising the Mbeya Project (Mbeya Agreement) and at which
time it entered into a deed of acknowledgement of trust with Mr Marko Kishiga (Holder)
The Holder holds the tenements exclusively for the Company who is the sole beneficial owner of
these tenements.
The Holder must deal with the tenements as directed by the Company.
The Company is responsible for all outgoings in relation to these tenements.
8.4. Mwanga Agreement
In May 2011 the Company exercised an option under an agreement to acquire a 50% beneficial
interest in one prospecting licence, PLR6100/2009, comprising the Mwanga Project and in
November 2011 the Company exercised a further option to acquire the remaining 50% from Gobbex
Limited, the registered holder of the licence.
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Settlement has occurred on the acquisition of the Mwanga Project but the transfer of title has not
been processed as at the date of this Prospectus.
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9. CORPORATE GOVERNANCE
9.1. ASX Corporate Governance Council Principles and Recommendations
The Company has adopted comprehensive systems of control and accountability as the basis for the
administration of corporate governance. The Board is committed to administering the policies and
procedures with openness and integrity, pursuing the true spirit of corporate governance
commensurate with the Company's needs.
To the extent applicable, the Company has adopted The Corporate Governance Principles and
Recommendations with 2010 Amendments (2nd Edition) as published by ASX Corporate Governance
Council (Recommendations).
In light of the Company’s size and nature, the Board considers that the current board is a cost
effective and practical method of directing and managing the Company. As the Company’s activities
develop in size, nature and scope, the size of the Board and the implementation of additional
corporate governance policies and structures will be reviewed.
The Company’s main corporate governance policies and practices as at the date of this Prospectus
are outlined below and the Company’s full Corporate Governance Plan is available in a dedicated
corporate governance information section of the Company’s website (http://www.tabora.com.au/).
9.2. Summary of Company policies
The Directors monitor the business affairs of the Company on behalf of Shareholders and have
formally adopted a corporate governance policy which is designed to encourage Directors to focus
their attention on accountability, risk management and ethical conduct.
The Company’s main corporate governance policies and practices are outlined below.
a) Board of Directors
The Board is ultimately responsible for all matters relating to the running of the Company. The
Board’s role is to govern the Company rather than to manage it. In governing the Company, the
Directors must act in the best interests of the Company as a whole. It is the role of senior
management to manage the Company in accordance with the direction and delegations of the Board
and the responsibility of the Board to oversee the activities of management in carrying out these
delegated duties.
The Board has the final responsibility for the successful operations of the Company. In general, it is
responsible for, and has the authority to determine, all matters relating to the policies, practices,
management and operations of the Company. It is required to do all things that may be necessary to
be done in order to carry out the objectives of the Company. In carrying out its governance role, the
main task of the Board is to drive the performance of the Company. The Board must also ensure that
the Company complies with all of its contractual, statutory and any other legal obligations, including
the requirements of any regulatory body.
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b) Composition of the Board
Election of Board members is substantially the province of the Shareholders in general meeting.
The Board has determined that, consistent with the size of the Company and its activities, the Board
shall be comprised of a minimum three Directors, one of whom shall be executive.
The Board's policy is that the majority of Directors shall be independent, non-executive Directors at
a time when the size of the Company and its activities warrants such a structure. This will ensure
that all Board discussions or decisions have the benefit of outside views and experience, and that the
majority of Directors will be free of any interests or influences that could, or could reasonably be
perceived to, materially interfere with the Director's ability to act in the best interests of the
Company.
The Board has adopted the definition of independence set out in the Recommendations.
The independence of the Company’s non-executive Directors will be assessed on an ongoing basis. In
the opinion of the Board, all Directors should bring specific skills and experience that add value to
the Company.
c) Independent professional advice
The Board or individual Directors may seek independent external professional advice as considered
necessary at the expense of the Company, subject to prior consultation with the Chairperson. A copy
of any such advice received is to be made available to all members of the Board.
d) Remuneration arrangements
The total maximum remuneration of Non-Executive Directors is the subject of a Shareholder
resolution in accordance with the Company’s Constitution, the Corporations Act and the ASX Listing
Rules, as applicable. The determination of Non-Executive Directors’ remuneration within that
maximum will be made by the Board having regard to the inputs and value to the Company of the
respective contributions by each Non-Executive Director. The current limit, which may only be varied
by Shareholders in general meeting, is an aggregate amount of $250,000 per annum.
Subject to the Constitution of the Company, the Board may award additional remuneration to
Non-Executive Directors called upon to perform extra services or make special exertions on behalf of
the Company.
e) External audit
The Company in general meetings is responsible for the appointment of the external auditors of the
Company, and the Board from time to time will review the scope, performance and fees of those
external auditors.
f) Audit committee
Due to its small size the Company will not have a separately constituted audit committee.
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g) Identification and management of risk
The Board’s collective experience will enable accurate identification of the principal risks that may
affect the Company’s business. Key operational risks and their management will be recurring items
for deliberation at Board meetings.
h) Ethical standards
The Board is committed to the establishment and maintenance of appropriate ethical standards.
i) Share Trading Policy
This policy sets out the circumstances in which the directors and those associated with the Company
may trade in the Company securities ensuring compliance with the requirements of the Corporations
Act. The purpose of this policy is to ensure adherence to high ethical and legal standards in relation
to investment in the Company’s securities; that the investments of those covered by the policy do
not conflict with the interests of the Company and those of other holders of the Company’s
securities; to preserve market confidence in the integrity of trading in the Company’s securities; and
to ensure the reputation of the Company is maintained.
9.3. Departures from Recommendations
Following admission to the Official List of ASX, the Company will be required to report any
departures from the Recommendations in its annual financial report.
The Company’s compliance and departures from the Recommendations as at the date of this
Prospectus are set out on the following pages.
Summary Statement
Recommendation Compliance Departure
1.1 �
1.2 �
2.1 �
2.2 �
2.3 �
2.4 �
2.5 �
3.1 �
3.2 �
3.3 �
3.4 �
4.1 �
4.2 �
4.3 �
5.1 �
6.1 �
7.1 �
7.2 �
7.3 �
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8.1 �
8.2 �
8.3 �
Recommendation 2.1:
A majority of the Board should be independent directors.
Reason for departure:
The Company currently has four directors of which two are independent. The board has been chosen
for its skills and experience and does not consider the Company is of sufficient size to add an
additional board member to justify the appointment of additional directors for the sole purpose of
satisfying this recommendation as it would be cost prohibitive and counterproductive. Further it
considers that the casting vote by its independent Chairman currently satisfies the recommendation
that the board should independent. As the operations of the Company develop the Board will
reassess the structure of the board.
Recommendation 2.4:
The Board should establish a nomination committee.
Reason for departure:
A nomination committee has not been established. The Company is not currently of a size nor are
its affairs of such complexity to justify the establishment of separate board committees. The role of
the nomination committee has been assumed by the full Board operating under the nomination
committee charter adopted by the Board.
Recommendation 3.3:
Companies should disclose in each annual report the measurable objectives for achieving gender
diversity set by the board in accordance with the diversity policy and progress towards achieving
them.
Reason for departure:
The Company has not yet reported under this guideline as a diversity policy was adopted after
issuing its 2011 Annual Report. The measureable objectives for achieving gender diversity and
progress towards achieving them will be reported in the future annual reports of the Company.
Recommendation 3.4:
Companies should disclose in each annual report the proportion of women employees in the whole
organisation, women in senior executive positions and women on the board.
Reason for departure:
The Company has not yet reported under this guideline as a diversity policy was adopted after
issuing its 2011 Annual Report. The proportion and positions of women in the Company will be
reported in the future annual reports of the Company.
Recommendation 4.1:
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The Board should establish an audit committee.
Reason for departure:
An audit committee has not been established. The Company is not currently of a size nor are its
affairs of such complexity to justify the establishment of separate board committees. The role of the
audit committee has been assumed by the full Board operating under the audit committee charter
adopted by the Board.
Recommendation 4.2:
The audit committee should be structured so that it:
• consists only of non-executive directors;
• consists of a majority of independent directors;
• is chaired by an independent Chair, who is not Chair of the Board; and
• has at least three members.
Reason for departure:
An audit committee has not been established. The Company is not currently of a size nor are its
affairs of such complexity to justify the establishment of separate board committees. The Board is
of the view that the experience and professionalism of the persons on the Board is sufficient to
ensure that all significant matters are appropriately addressed and actioned. Further, the Board
does not consider that the Company is of sufficient size to justify the appointment of additional
directors for the sole purpose of satisfying this recommendation as it would be cost prohibitive and
counterproductive. As the operations of the Company develop the Board will reassess the formation
of the audit committee.
Recommendation 7.2:
The Board should require management to design and implement the risk management and internal
control system to manage the Company's material business risks and report to it on whether those
risks are being managed effectively. The Board should disclose that management has reported to it
as to the effectiveness of the Company's management of its material business risks.
Reason for departure:
The Company does not currently have any separate management. A risk management committee
has not been formed and no internal audit function exists. All functions, roles and responsibilities
with regard to risk oversight and management and internal control are undertaken by the Board as a
whole. The Company policies are designed to ensure strategic, operational, legal, reputation and
financial risks are identified, assessed, effectively and efficiently managed and monitored to enable
achievement of the Company’s business objectives.
Recommendation 8.1:
The Board should establish a remuneration committee.
Reason for departure:
A remuneration committee has not been established. The Company is not currently of a size nor are
its affairs of such complexity to justify the establishment of a remuneration committee. The role of
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the remuneration committee has been assumed by the full Board operating under the remuneration
committee charter adopted by the Board.
Recommendation 8.2:
The remuneration committee should be structured so that it:
• consists of a majority of independent directors
• is chaired by an independent chair
• has at least three members
Reason for departure:
The Board does not consider that the Company is of sufficient size to justify the appointment of
additional directors for the sole purpose of satisfying this recommendation as it would be cost
prohibitive and counterproductive. As the operations of the Company develop the Board will
reassess the formation of the remuneration committee.
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10. ADDITIONAL INFORMATION
10.1. Litigation
As at the date of this Prospectus, the Company is not involved in any legal proceedings and the
Directors are not aware of any legal proceedings pending or threatened against the Company.
10.2. Rights Attaching to Shares
Full details of the rights attaching to Shares are set out in the Company’s Constitution a copy of
which can be inspected, free of charge, at the Company’s registered office during normal business
hours.
The following is a broad summary of the rights, privileges and restrictions attaching to all Shares.
This summary is not exhaustive and does not constitute a definitive statement of the rights and
liabilities of Shareholders. To obtain such a statement, persons should seek independent legal
advice.
(a) General Meetings
Shareholders are entitled to be present in person, or by proxy, attorney or representative to
attend and vote at general meetings of the Company. Shareholders may requisition
meetings in accordance with Section 249D of the Corporations Act and the Constitution of
the Company.
(b) Voting Rights
Subject to any rights or restrictions for the time being attached to any class or classes of
shares, at general meetings of Shareholders or classes of Shareholders:
(i) each Shareholder entitled to vote may vote in person or by proxy, attorney or
representative;
(ii) on a show of hands, every person present who is a shareholder or a proxy,
attorney or representative of a Shareholder has one vote; and
(iii) on a poll, every person present who is a Shareholder or a proxy, attorney or
representative of a shareholder shall, in respect of each fully paid share held by
him, or in respect of which he is appointed a proxy, attorney or representative,
have one vote for the share, but in respect of partly paid shares shall have such
number of votes being equivalent to the proportion which the amount paid (not
credited) is the total of amounts paid and payable in respect of those shares
(excluding amounts credited).
(c) Dividend Rights
Subject to and in accordance with the Corporations Act, the ASX Listing Rules, the rights of
any preference Shareholders and to the rights of the holders of any shares created or raised
under any special arrangement as to dividend, the Directors may from time to time declare a
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dividend to be paid to the Shareholders entitled to the dividend which shall be payable on all
Shares according to the proportion that the amount paid (not credited) is of the total
amounts paid and payable (excluding amounts credited) in respect of such Shares.
The Directors may from time to time pay to the Shareholders any interim dividends as they
may determine. No dividend shall carry interest as against the Company. The Directors may
set aside out of the profits of the Company any amounts that they may determine as
reserves, to be applied at the discretion of the Directors, for any purpose for which the
profits of the Company may be properly applied.
Subject to the ASX Listing Rules and the Corporations Act, the Company may, by resolution
of the Directors, implement a dividend reinvestment plan on such terms and conditions as
the Directors think fit and which provides for any dividend which the Directors may declare
from time to time payable on Shares which are participating Shares in the dividend
reinvestment plan, less any amount which the Company shall either pursuant to the
Constitution or any law be entitled or obliged to retain, be applied by the Company to the
payment of the subscription price of Shares.
(d) Winding-Up
If the Company is wound up, the liquidator may, with the authority of a special resolution of
the Company, divide among the shareholders in kind the whole or any part of the property
of the Company, and may for that purpose set such value as he considers fair upon any
property to be so divided, and may determine how the division is to be carried out as
between the shareholders or different classes of shareholders.
The liquidator may, with the authority of a special resolution of the Company, vest the
whole or any part of any such property in trustees upon such trusts for the benefit of the
contributories as the liquidator thinks fit, but so that no shareholder is compelled to accept
any shares or other securities in respect of which there is any liability.
(e) Transfer of Shares
Generally, shares in the Company are freely transferable, subject to formal requirements,
the registration of the transfer not resulting in a contravention of or failure to observe the
provisions of a law of Australia and the transfer not being in breach of the Corporations Act
or the ASX Listing Rules.
(f) Variation of Rights
Pursuant to Section 246B of the Corporations Act, the Company may, with the sanction of a
special resolution passed at a meeting of Shareholders vary or abrogate the rights attaching
to Shares.
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If at any time the share capital is divided into different classes of shares, the rights attached
to any class (unless otherwise provided by the terms of issue of the shares of that class),
whether or not the Company is being wound up may be varied or abrogated with the
consent in writing of the holders of three-quarters of the issued shares of that class, or if
authorised by a special resolution passed at a separate meeting of the holders of the shares
of that class.
(g) Shareholder liability
As the Shares under the Prospectus are fully paid shares, they are not subject to any calls for
money by the Directors and will therefore not become liable for forfeiture.
(h) Alteration of Constitution
In accordance with the Corporations Act, the Constitution can only be amended by a special
resolution passed by at least three quarters of Shareholders present and voting at the
general meeting. In addition, at least 28 days written notice specifying the intention to
propose the resolution as a special resolution must be given.
10.3. Interests of Directors
Other than as set out in this Prospectus, no Director or proposed Director holds, or has held within
the 2 years preceding lodgement of this Prospectus with the ASIC, any interest in:
(a) the formation or promotion of the Company;
(b) any property acquired or proposed to be acquired by the Company in connection with:
a. its formation or promotion; or
b. the Offer; or
(c) the Offer,
and no amounts have been paid or agreed to be paid and no benefits have been given or agreed to
be given to a Director or proposed Director:
(a) as an inducement to become, or to qualify as, a Director; or
(b) for services provided in connection with:
a. the formation or promotion of the Company; or
b. the Offer.
10.4. Interests of experts and advisers
Other than as set out below or elsewhere in this Prospectus, no:
(a) person named in this Prospectus as performing a function in a professional advisory or other
capacity in connection with the preparation or distribution of this Prospectus; or
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(b) promoter of the Company; or
(c) underwriter (but not a sub-underwriter) to the issue or a financial services licensee named in
this Prospectus as a financial services licensee involved in the issue,
holds, or has held within the two years before lodgement of this Prospectus with the ASIC, any
interest in:
(a) the formation or promotion of the Company;
(b) any property acquired or proposed to be acquired by the Company in connection with:
a. its formation or promotion; or
b. the Offer; or
(c) the Offer,
and no amounts have been paid or agreed to be paid and no benefits have been given or agreed to
be given to any of these persons for services provided in connection with:
(a) the formation or promotion of the Company; or
(b) the Offer.
Al Maynard & Associates Pty Ltd has acted as the Independent Geologist and has prepared an
Independent Geologist’s Report which is included in Section 4 of this Prospectus. The Company
estimates that it will pay Al Maynard & Associates Pty Ltd a total of $18,000 (excluding GST and
disbursements) for these services. During the 24 months preceding lodgement of this Prospectus
with the ASIC, Al Maynard & Associates Pty Ltd has not received fees from the Company for any
other services.
Ishengoma, Karume, Masha & Magai Advocates (IMMMA) has acted as Tanzanian solicitors to the
Company and has prepared the Solicitor’s Report on Tenements which is included in Section 0 of this
Prospectus. The Company estimates that it will pay IMMMA $15,000 (excluding GST and
disbursements) for these services. During the 24 months preceding lodgement of this Prospectus
with the ASIC, IMMA Advocates has not received fees from the Company for any other services.
Stantons International Pty Ltd trading as Stantons International Securities (SIS) has acted as
Investigating Accountant and has prepared an Investigating Accountant’s Report which has been
included in Section 5 of this Prospectus. The Company estimates it will pay SIS $11,523 (excluding
GST and disbursements) for these services. Subsequently, fees will be charged in accordance with
normal charge out rates. During the 24 months preceding lodgement of this Prospectus with the
ASIC, an affiliated firm, Stantons International Audit and Consulting Pty Ltd trading as Stantons
International has received $28,801 (excluding GST and disbursements) from the Company for audit
services.
Steinepreis Paganin has acted as the Australian solicitors to the Company in relation to the Offer.
The Company estimates it will pay Steinepreis Paganin $40,000 (excluding GST and disbursements)
for these services. Subsequently, fees will be charged in accordance with normal charge out rates.
During the 24 months preceding lodgement of this Prospectus with the ASIC, Steinepreis Paganin has
not received fees from the Company for any other services.
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10.5. Consents
Each of the parties referred to in this section:
(a) does not make, or purport to make, any statement in this Prospectus other than those referred
to in this section; and
(b) to the maximum extent permitted by law, expressly disclaim and take no responsibility for any
part of this Prospectus other than a reference to its name and a statement included in this
Prospectus with the consent of that party as specified in this section.
Al Maynard & Associates Pty Ltd has given its written consent to being named as the Independent
Geologist to the Company in this Prospectus, the inclusion of the Independent Geologist’s Report in
Section 4 in the form and context in which the report is included and the inclusion of statements
contained in the Chairman’s Letter, Investment Overview and Section 2 of this Prospectus in the
form and context in which those statements are included. Al Maynard & Associates Pty Ltd has not
withdrawn its consent prior to the lodgement of this Prospectus with the ASIC.
SIS has given its written consent to being named as Investigating Accountant in this Prospectus and
to the inclusion of the Investigating Accountant’s Report in Section 5 in the form and context in
which the report is included. SIS has not withdrawn its consent prior to lodgement of this Prospectus
with the ASIC.
IMMMA has given its written consent being named as the Tanzanian solicitors to the Company in
this Prospectus and to the inclusion of the Solicitor’s Report on Tenements in Section 0 in the form
and context in which the report is. IMMMA has not withdrawn its consent prior to the lodgement of
this Prospectus with the ASIC.
Steinepreis Paganin has given its written consent to being named as the Australian solicitors to the
Company in this Prospectus. Steinepreis Paganin has not withdrawn its consent prior to the
lodgement of this Prospectus with the ASIC.
Stantons International Audit and Consulting Pty Ltd trading as Stantons International (SIAC) has
given its written consent to being named as the auditor to the Company in this Prospectus. SIAC has
not withdrawn its consent prior to the lodgement of this Prospectus with the ASIC.
Computershare Investor Services Pty Limited (Computershare) has given its written consent to being
named as the share registry to the Company in this Prospectus. Computershare has not withdrawn
its consent prior to the lodgement of this Prospectus with the ASIC.
10.6. Expenses of the Offer
The total expenses of the Offer (excluding GST) are estimated to be $476,379 for full subscription
and are expected to be applied towards the items set out in the table below:
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Item of Expenditure $
ASIC fees 2,137
ASX fees 47,550
Independent Geologist fees 18,000
Investigating Accountant fees 11,523
Tanzanian Solicitor fees 15,000
Australian Solicitor fees 40,000
Printing, Design and Postage 27,250
Broker Commissions* 300,000
Miscellaneous 14,919
TOTAL 476,379
* Broker commissions will only be paid on applications made through a licensed securities dealers or Australian financial
services licensee and accepted by the Company (refer to Section 1.9 of this Prospectus for further information). The
amount calculated is based on 100% of applications being made in this manner. For those applications made directly to
and accepted by the Company no broker commissions will be payable and the expenses of the Offer will be reduced and
the additional funds will be put towards working capital.
10.7. Continuous disclosure obligations
Following admission of the Company to the Official List, the Company will be a “disclosing entity” (as
defined in Section 111AC of the Corporations Act) and, as such, will be subject to regular reporting
and disclosure obligations. Specifically, like all listed companies, the Company will be required to
continuously disclose any information it has to the market which a reasonable person would expect
to have a material effect on the price or the value of the Company’s securities.
Price sensitive information will be publicly released through ASX before it is disclosed to
shareholders and market participants. Distribution of other information to shareholders and market
participants will also be managed through disclosure to the ASX. In addition, the Company will post
this information on its website after the ASX confirms an announcement has been made, with the
aim of making the information readily accessible to the widest audience.
10.8. Electronic Prospectus
Pursuant to Class Order 00/44, the ASIC has exempted compliance with certain provisions of the
Corporations Act to allow distribution of an electronic prospectus and electronic application form on
the basis of a paper prospectus lodged with the ASIC, and the publication of notices referring to an
electronic prospectus or electronic application form, subject to compliance with certain conditions.
If you have received this Prospectus as an electronic Prospectus, please ensure that you have
received the entire Prospectus accompanied by the Application Form. If you have not, please email
the Company at [email protected] and the Company will send you, at no cost, either a hard copy
or a further electronic copy of the Prospectus or both. Alternatively, you may obtain a copy of the
Prospectus from the Company’s website at http://www.tabora.com.au.
The Company reserves the right not to accept an Application Form from a person if it has reason to
believe that when that person was given access to the electronic Application Form, it was not
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provided together with the electronic Prospectus and any relevant supplementary or replacement
prospectus or any of those documents were incomplete or altered.
10.9. Financial Forecasts
The Directors have considered the matters set out in ASIC Regulatory Guide 170 and believe that
they do not have a reasonable basis to forecast future earnings on the basis that the operations of
the Company are inherently uncertain. Accordingly, any forecast or projection information would
contain such a broad range of potential outcomes and possibilities that it is not possible to prepare a
reliable best estimate forecast or projection.
10.10. Clearing House Electronic Sub-Register System (CHESS) and Issuer Sponsorship
The Company will apply to participate in CHESS, for those investors who have, or wish to have, a
sponsoring stockbroker. Investors who do not wish to participate through CHESS will be issuer
sponsored by the Company.
Electronic sub-registers mean that the Company will not be issuing certificates to investors. Instead,
investors will be provided with statements (similar to a bank account statement) that set out the
number of Shares allotted to them under this Prospectus. The notice will also advise holders of their
Holder Identification Number or Security Holder Reference Number and explain, for future
reference, the sale and purchase procedures under CHESS and issuer sponsorship.
Electronic sub-registers also mean ownership of securities can be transferred without having to rely
upon paper documentation. Further monthly statements will be provided to holders if there have
been any changes in their security holding in the Company during the preceding month.
10.11. Privacy statement
If you complete an Application Form, you will be providing personal information to the Company.
The Company collects, holds and will use that information to assess your application, service your
needs as a Shareholder and to facilitate distribution payments and corporate communications to you
as a Shareholder.
The information may also be used from time to time and disclosed to persons inspecting the
register, including bidders for your securities in the context of takeovers, regulatory bodies including
the Australian Taxation Office, authorised securities brokers, print service providers, mail houses and
the share registry.
You can access, correct and update the personal information that we hold about you. If you wish to
do so, please contact the share registry at the relevant contact number set out in this Prospectus.
Collection, maintenance and disclosure of certain personal information is governed by legislation
including the Privacy Act 1988 (as amended), the Corporations Act and certain rules such as the ASX
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Settlement Operating Rules. You should note that if you do not provide the information required on
the application for Shares, the Company may not be able to accept or process your application.
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11. DIRECTORS’ AUTHORISATION
This Prospectus is issued by the Company and its issue has been authorised by a resolution of the
Directors. In accordance with Section 720 of the Corporations Act, each Director has consented to
the lodgement of this Prospectus with ASIC.
_________________________
Roland Hill
Director
For and on behalf of
Tabora Limited
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12. GLOSSARY
Where the following terms are used in this Prospectus they have the following meanings:
A$ or $ means an Australian dollar.
Applicant means a person who submits an Application Form.
Application Form means the application form accompanying this Prospectus relating to the Offer.
ASIC means Australian Securities & Investments Commission.
ASX means ASX Limited (ABN 98 008 624 691) or the Australian Securities Exchange (as the context
requires).
ASX Listing Rules means the official listing rules of the ASX.
Board means the board of Directors as constituted from time to time.
Closing Date means the closing date of the Offer as set out in Section the indicative timetable in the
Section of this Prospectus titled “Investment Overview” (subject to the Company reserving the right
to extend the Closing Date or close the Offer early).
Company means Tabora Limited (ACN 107 045 983).
Constitution means the constitution of the Company.
Convertible Note means the convertible note to be issued by the Company the subject of the
convertible note deed summarised in Section 8.2 of this Prospectus.
Convertible Note Deed means the convertible note deed summarised in Section 8.2 of this
Prospectus.
Corporations Act means the Corporations Act 2001 (Cth).
Directors means the directors of the Company at the date of this Prospectus.
Exposure Period means the period of 7 days after the date of lodgement of this Prospectus, which
period may be extended by the ASIC by not more than 7 days pursuant to Section 727(3) of the
Corporations Act.
JORC Code means the Australasian Code for Reporting of Exploration Results, Mineral Resources and
Ore Reserves (2004) prepared by the Joint Ore Reserves Committee of the Australasian Institute of
Mining and Metallurgy, Australian Institute of Geoscientists and Minerals Council of Australia.
Offer means the offer of Shares pursuant to this Prospectus as outlined in Section 1.
Official List means the official list of ASX.
Official Quotation means official quotation by ASX in accordance with the Listing Rules.
Projects means each of the Company’s 3 projects as described in Section 2 and in the Independent
Geologists Report.
Prospectus means this prospectus.
Resolute Agreement means the agreement referred to in Section 8.1.
Resolute Tenements means the tenements the subject of the Resolute Agreement as noted in the
Solicitor’s Report on Tenements.
Share means a fully paid ordinary share in the capital of the Company.
Shareholder means a holder of Shares.
Solicitor’s Report on Tenements means the report included in Section 0 of this Prospectus.
Tenements means the exploration tenements in which the Company has an interest as set out in this
Prospectus.
WST means Western Standard Time, Perth, Western Australia.
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Application Form
Unit Street Number Street Name or PO Box /Other Information
I/we apply forA
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BSB Number Account NumberDrawer Amount of cheque
A$
Cheque Number
Tax File Number or Exemption Application #2 Application #2
Number of Shares in Tabora Limited at $0.20 per Share or such lesser number of Shares which may be allocated to me/us
Enter your postal address Include State and Postcode
City / Suburb / Town State Postcode
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C Individual/Joint applications refer to naming standards overleaf for correct forms of registrable title(s)
Title or Company Name Given Name(s) Surname
Joint Applicant 2 or Account Designation
Joint Applicant 3 or Account Designation
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Enter your contact details
CHESS Participant
Tax File Number
By submitting this Application Form, I/we declare that this application is completed and lodged according to the Prospectus and the declarations/statements on the reverse of this Application form and I/we declare that all details and statements made by me/us (including the declaration on the reverse of this Application Form) are complete and accurate. I/we agree to be bound by the Constitution of the Company.
Broker Code Adviser CodeThis Application Form is important. If you are in doubt as to how to deal with it, please contact your stockbroker or professional adviser without delay. You should read the entire prospectus carefully before completing this form. To meet the requirements of the Corporations Act, this Application Form must not be distributed unless included in, or accompanied by, the prospectus.
I P O
Registry Use Only
I/we lodge full Application MoneyB
.A$
Contact Name Telephone Number Business Hours / After Hours
( )
X
See back of form for completion guidelines
Please note that if you supply a CHESS HIN but the name and address details on your form do not correspond exactly with the registration details held at CHESS, your application will be deemed to be made without the CHESS HIN, and any securities issued as a result of the IPO will be held on the Issuer Sponsored subregister.
LIMITEDABN 55 107 045 983
Enter the TAX FILE NUMBER(S) of the Applicant(s). Collection of Tax File Number is authorised by taxation laws. Quotation of Tax File Number(s) in not compulsory and will not affect the Application.
Holder Identification Number (HIN)
Cheque details – Make your cheque or bank draft payable to Tabora Limited Share Offer Account
SAMP_PAYMENT_000000/000001/000001/i
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Before completing the Application Form the applicant(s) should read this prospectus to which this application relates. By lodging the Application Form, the applicant agrees that this application for Shares in Tabora Limited is upon and subject to the terms of the prospectus and the Constitution of Tabora Limited, agrees to take any number of Shares that may be allotted to the Applicant(s) pursuant to the prospectus and declares that all details and statements made are complete and accurate. It is not necessary to sign the Application Form.
Lodgement of ApplicationApplication Forms must be received by Computershare Investor Services Pty Limited Perth by no later than 5.00pm WST on !"#$%&'(#)"*).Return the Application Form with cheque(s) attached to:
Computershare Investor Services Pty Limited OR Computershare Investor Services Pty LimitedGPO Box D182 Level 2Perth WA 6000 45 St Georges Tce Perth WA 6000
Neither CIS nor the Company accepts any responsibility if you lodge the Application Form at any other address or by any other means.
Privacy StatementPersonal information is collected on this form by Computershare Investor Services Pty Limited (“CIS”), as registrar for securities issuers (“the issuer”), for the purpose of maintaining registers of securityholders, facilitating distribution payments and other corporate actions and communications. Your personal information may be disclosed to our related bodies corporate, to external service companies such as print or mail service providers, or as otherwise required or permitted by law. If you would like details of your personal information held by CIS, or you would like to correct information that is inaccurate, incorrect or out of date, please contact CIS. In accordance with the Corporations Act 2001, you may be sent material (including marketing material) approved by the issuer in addition to general corporate communications. You may elect not to receive marketing material by contacting CIS. You can contact CIS using the details provided on the front of this form or email [email protected]
If you have any enquiries concerning your application, please contact the Computershare Investor Services Pty Limited on 1300 850 505.
Correct forms of registrable title(s)Note that ONLY legal entities are allowed to hold Shares. Applications must be made in the name(s) of natural persons, companies or other legal entities in accordance with the Corporations Act. At least one full given name and the surname is required for each natural person. The name of the beneficial owner or any other registrable name may be included by way of an account designation if completed exactly as described in the examples of correct forms of registrable title(s) below.
How to complete this form
Shares Applied forEnter the number of Shares you wish to apply for. The application must be for a minimum of 10,000 Shares. Applications for greater than 10,000 Shares must be in multiples of 1000 Shares.
Application MoniesEnter the amount of Application Monies. To calculate the amount, multiply the number of Shares by the price per Share.
Applicant Name(s)Enter the full name you wish to appear on the statement of share holding. This must be either your own name or the name of a company. Up to 3 joint Applicants may register. You should refer to the table below for the correct forms of registrable title. Applications using the wrong form of names may be rejected. Clearing House Electronic Subregister System (CHESS) participants should complete their name identically to that presently registered in the CHESS system.
Postal AddressEnter your postal address for all correspondence. All communications to you from the Registry will be mailed to the person(s) and address as shown. For joint Applicants, only one address can be entered.
Contact Details
Enter your contact details. These are not compulsory but will assist us if we need to contact you.
CHESSTabora Limited (the Company) will apply to the ASX to participate in CHESS, operated by ASX Settlement Pty Limited, a wholly owned subsidiary of Australian Securities Exchange Limited. In CHESS, the company will operate
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an electronic CHESS Subregister of security holdings and an electronic Issuer Sponsored Subregister of security holdings. Together the two Subregisters will make up the Company’s principal register of securities. The Company will not be issuing certificates to applicants in respect of Shares allotted. If you are a CHESS participant (or are sponsored by a CHESS participant) and you wish to hold Shares allotted to you under this Application on the CHESS Subregister, enter your CHESS HIN. Otherwise, leave this section blank and on allotment, you will be sponsored by the Company and allocated a Securityholder Reference Number (SRN).
PaymentMake your cheque or bank draft payable to Tabora Limited Share Offer Account in Australian currency and cross it Not Negotiable. Your cheque or bank draft must be drawn on an Australian Bank.
Complete the cheque details in the boxes provided. The total amount must agree with the amount shown in box B. Please note that funds are unable to be directly debited from your bank account.
Cheques will be processed on the day of receipt and as such, sufficient cleared funds must be held in your account as cheques returned unpaid may not be represented and may result in your Application being rejected. Paperclip (do not staple) your cheque(s) to the Application Form where indicated. Cash will not be accepted. Receipt for payment will not be forwarded.
Tax File NumberEnter the TAX FILE NUMBER(S) of the Applicant(s). Collection of Tax File Number is authorised by taxation laws. Quotation of Tax File Number(s) in not compulsory and will not affect the Application.
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Type of Investor Correct Form of Registration Incorrect Form of Registration
Trusts Use trustee(s) personal name(s) Do not use the name of the trust
Individual Use given name(s) in full, not initials
Joint Use given name(s) in full, not initials
Company Use company title, not abbreviations
Deceased Estates Use executor(s) personal name(s) Do not use the name of the deceased
Minor (a person under the age of 18) Use the name of a responsible adult with an appropriate designation
Partnerships Use partners personal name(s) Do not use the name of the partnership
Clubs/Unincorporated Bodies/Business Names Use office bearer(s) personal name(s) Do not use the name of the club etc
Superannuation Funds Use the name of trustee of the fund Do not use the name of the fund
Mr John Alfred Smith
Mr John Alfred Smith & Mrs Janet Marie Smith
ABC Pty Ltd
Ms Penny Smith<Penny Smith Family A/C>
Mr Michael Smith<Est John Smith A/C>
Mr John Alfred Smith<Peter Smith A/C>
Mr John Smith &Mr Michael Smith<John Smith & Son A/C>
Mrs Janet Smith<ABC Tennis Association A/C>
John Smith Pty Ltd<Super Fund A/C>
J.A Smith
ABC P/LABC Co
Penny Smith Family Trust
Estate of Late John Smith
Peter Smith
John Smith & Son
ABC Tennis Association
John Smith Pty Ltd Superannuation Fund
John Alfred &Janet Marie Smith
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