Gindalbie Metals : Shareholder Information Presentation - Mount Gunson

Shareholder Information Presentation

Disclaimer

Nature of this document: The purpose of this presentation is to provide general information about Gindalbie Metals Ltd (the 'Company'). Unless otherwise stated herein, the information in this presentation is based on the Company's own information and estimates. In attending this presentation or viewing this document you agree to be bound by the following terms and conditions.

Not an offer: This presentation is for information purposes and does not constitute or form any part of any offer or invitation to sell or issue, or any solicitation of any offer to purchase or subscribe for, any securities in the Company in any jurisdiction. This presentation and its contents must not be distributed, transmitted or viewed by an person in any jurisdiction where the distribution, transmission or viewing of this document would be unlawful under the securities or other laws of that or any jurisdiction.

Not financial product advice: This presentation does not take into account the individual investment objectives, financial situation and particular needs of each of the Company's shareholders or potential investors. You may wish to seek independent financial and taxation advice before making any decisions in respect to this presentation. Neither the Company nor any of its related bodies corporate is licensed to provide financial advice in respect of the Company's securities or any other financial products.

Forward-looking statements: Certain statements in the presentation are or may be perceived as "forward looking statements" and represent the Company's intentions, projections, expectations or beliefs concerning, among other things, future operating and exploration results or the Company's future performance. You are cautioned not to place undue reliance on any forward looking statement. These forward looking statements are based on current expectations at the date of this publication. The projections, estimates and beliefs contained in such forward looking statements necessarily involve known and unknown risks and uncertainties, and are necessarily based on assumptions, which may cause the Company's actual performance and results in future periods to differ materially from any express or implied estimates or projections.

Disclaimer: No representation or warrant, express or implied, is made by the Company that the material contained in this presentation will be achieved or prove to be correct. Except for statutory liability which cannot be excluded, each of the Company, its directors, officers, employees, advisers, agents and contractors expressly disclaims any responsibility for the accuracy, fairness, sufficiency or completeness of the material contained in this presentation, or any opinions or beliefs contained in this document, and excludes all liability whatsoever (including negligence) for any loss or damage which may be suffered by any persons as a consequence of any information in this presentation or any error or omission there from. The Company is under no obligation to update or keep current the information contained in this presentation or to correct any inaccuracy or omission which may become apparent, or to furnish any person with any further information. Any opinions expressed in the presentation are subject to change without notice.

Unverified information: This presentation may contain information (including information derived from publicly available sources) that has not been independently verified by the Company.

Gindalbie farms-in to Mt Gunson Copper-Cobalt Project

• Gindalbie has signed a farm-in agreement with Terrace Mining Pty Ltd, a wholly owned subsidiary of Torrens Mining Ltd to develop and earn up to 75% of the Mt Gunson Copper-Cobalt Project in South Australia

• The transaction provides an opportunity for Gindalbie to secure a low cost, staged entry to an area, currently covering approximately 824km2 of prospective exploration tenements1 in one of the world's premier copper belts

• The multi-phase farm-in structure will allow Gindalbie to progressively invest in the Project, minimise risk and optimise feasibility progress

• Gindalbie will earn up to a 70% interest in Mt Gunson for total feasibility expenditure of A$6.62M with the option to purchase an additional 5% interest at the completion of Stage 3 for A$1.50M

• Terrace Mining will be free carried to a maximum of A$8.62M in feasibility costs at which point, a formal JV will be triggered and Terrace will be responsible for its share of ongoing Project expenditure

• The Farm-in Agreement contains what Gindalbie considers to be customary conditions precedent for an agreement of this nature including approval of the Foreign Investment Review Board, and other relevant statutory approvals.

  1An application for a 10% reduction in total area was lodged with the DSD in July 2016

  Transaction overview

  • Gindalbie's entry is by way of an industry standard "farm-in" structure

  • Entry to the project is staged in order to reduce risk and provide Gindalbie with multiple decision points as feasibility progresses

  • Gindalbie may elect to exit the project without additional costs at each milestone and retain earned interest

  • Both parties retain a pre-emptive right of first refusal should the other party wish to sell their interest in the project

Stage 1

Stage 2

Stage 3

Other

• Gindalbie commits to fund mining and processing studies identified in the Scoping Study as critical next steps

• Gindalbie may exit the Farm-in retaining 25% after completion of Stage 1

• Gindalbie commits to fund feasibility and development work up to a total of

  A$2.50M in order to earn 51%

• If Gindalbie elects to exit the Farm in after the completion of Stage 2 then it will retain

  49% of the total Project area

• Stage 2 work must be completed with 4 years of the farm-in commencement date

• Gindalbie may elect to fund further feasibility work to achieve a Decision to Mine up to a total of A$2.75M at

  which point it will automatically earn 70% of the total Project assets

• If a decision to mine is achieved prior to total farm-in expenditure of A$6.62M then Gindalbie will pay the difference to Torrens

• Stage 3 work must be completed within a maximum of 6 years from the farm-in commencement date

• Funds and timeframes are indicative only of Gindalbie's commitments and may not reflect actual feasibility costs and timeframes

• On completion of Stage 3, Gindalbie will have the option to purchase a further 5% of the project for A$1.50M

• If a Decision to Mine has not been reached on total expenditure of A$6.62M then Torrens will be free-carried up to a total of A$8.62M after which they will be liable for their share of feasibility and development expenditure

Project interest:

25% earned on expenditure of A$1.37M

Project interest:

51% earned on expenditure of A$2.50M in addition to Stage 1

Project interest:

70% earned on expenditure of A$2.75M in addition to Stage 2

• Free carry to A$8.62M in total feasibility expenditure

• Option to acquire an additional 5% for A$1.50M