egm presentation to foyson shareholders

Download EGM Presentation to Foyson Shareholders

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  • CAUTIONARY STATEMENT

    This document has been prepared by Foyson Resources Limited (the Company). This document contains background informationabout the Company and its projects current at the date of this document. It does not purport to be all inclusive or complete. Recipientsshould conduct their own investigations and perform their own analysis in order to satisfy themselves as to the accuracy andcompleteness of the information, statements and opinions contained in this document.The document is for information purposes only. Neither the document nor the information contained in it constitutes an offer, invitation,solicitation or recommendation in relation to the purchase or sale of shares in any jurisdiction. This document may not be distributed inany jurisdiction except in accordance with the legal requirements applicable in such jurisdiction. Recipients should inform themselves ofthe restrictions that apply in their own jurisdiction.To the fullest extent permitted by law, Foyson Resources Limited, its officers, employees, agents and advisers do not make anyrepresentation or warranty, expressed or implied, as to the currency, accuracy, reliability or completeness of any information,statements, opinions, estimates, forecasts or other representations contained in this document. No responsibility for any errors in oromissions from this document is accepted.This document contains "forward-looking statements". Such forward-looking statements include, without limitation, (i) estimates offuture earnings, and the sensitivity of earnings to fuel prices; (ii) estimates of future production/sales (iii) estimates of future cash costs;(iv) estimates of future cash flows, and the sensitivity of cash flows; (v) statements regarding future debt arrangements; (vi) estimates offuture capital expenditures; (vii) estimates of reserves and (viii) the timing or results of permitting, construction and production activities.Where Foyson Resources Limited expresses or implies an expectation or belief as to future events or results, such expectation or beliefis expressed in good faith and believed to have a reasonable basis.However, forward-looking statements are subject to risks, uncertainties and other factors, which could cause actual results to differmaterially from future results expressed, projected or implied by such forward-looking statements. Such risks include, but are not limitedto, price volatility, currency fluctuations, increased production costs, variances in production or recovery rates from those assumed, aswell as political and operational risks in the countries in which we operate and governmental regulation and judicial outcomes.The Company does not undertake any obligation to release publicly any revisions to any "forward-looking statement" to reflect eventsor circumstances after the date of this document, or to reflect the occurrence of unanticipated events.

    Notice and Disclaimer

  • My name is Paul Dickson. I am Chairman of the Company and I amvery pleased to welcome you here today to this Extraordinary GeneralMeeting.

    The company is going through a process of revitalisation and today wewill tell you about the steps we have taken to date and the improvedprospects for the company.

    The information we have for you today augers well for the companyand all shareholders.

    We have a fairly new Board of Directors and we are all very eager todo our very best to strengthen the Company, maintain good corporategovernance and serve our shareholders well.

    Chairmans Address

  • This presentation has been prepared on the basis of the Boards currentlevel of knowledge. Shareholders are advised to refer to the upcomingNotice of Meeting for the EGM to consider the IGE transaction, planned onor about 10 June 2015, and the Prospectus for the subsequent fundraising, for a summary of the proposed transaction with IGE, and itsbenefits and risks, before making a decision to invest.The presentation will comprise three phases:

    1. IGE DEAL - Presented by Mike Palmer2. IGE PROJECT STATUS - Presented by Bevan Dooley3. PNG STRATEGY - Presented by Mike Palmer

    Presentation

  • IGE DEAL

  • Challenging market for junior resource companies and increasinglydifficult to raise investment capital

    Falling commodity prices, with iron ore now sub US$60 per tonne

    Need to fund Company internally, rather than from equities market

    Board has reviewed numerous projects over eighteen months toidentify an attractive cash flow project

    Corporate Strategy

  • Minimal upfront capital

    Short term cash flow

    Australian based

    Potential for significant growth

    Performance component of Consideration

    IGE waste plastics to fuel opportunity meets all criteria

    Cashflow Project Criteria

  • Binding agreement concluded on 18 March 2015 Subject to Shareholder approval and completion of Due Diligence,

    Company will acquire: 3 Technologies

    Waste plastics to fuels Biomass to power Biomass to fuel

    Exclusive licences to commercialize the three technologies in the keyjurisdictions of Australia, New Zealand, China, North America, SouthEast Asia, India, Papua New Guinea and Fiji

    Non exclusive licences (1 of 4) in each of other jurisdictions Berkeley Vale site (NSW Central Coast) permitted for diesel production An operating Commercial Facility designed to process 50 tonnes

    feedstock per day Management and production team

    IGE Project Acquisition

  • Completion Securities130 million shares and 75 million options* (exercise price of $0.20,

    prior to 31 December 2019), subject to:- 50 tonnes feedstock per day Commercial Facility completed and

    meeting all engineering specifications*Number of shares and options to be issued on completion may change to ensure that after the issue, IGE will have 60.897% of total shares on issue and 61.153% of total options on issue

    Milestone Securities15 million shares and 70 million options* (same terms as

    above), subject to:- EBITDA of $5 million per annum from operations, within 3 yearsof Completion

    *Number of shares and options to be issued on milestone may change to ensure that after the issue,IGE will have 63.454% of total shares on issue and 75.269% of total options on issue

    IGE Consideration

  • Company may unwind transaction (subject to necessary Shareholder andregulatory approvals) if, by 31 December 2016, Commercial Facility is not:

    Processing 35 or more tonnes of feedstock materials per day

    Operating 8 or more days per month

    Producing fuel products meeting all Australian Industry Fuel Standards(on road standards of diesel and petrol)

    IGE Consideration

  • Expected Share Structure at Completion

  • EGM scheduled to be held on (or about) 10 June 2015 to consider theIGE transaction

    Convertible Promissory Notes placed to Sophisticated Investors toraise $1 million (substantially filled and planned for completion by midApril 2015)

    Placement to Sophisticated Investors to raise $3 million following EGMin June

    Rights Issue (1 for 10) to all Shareholders to raise $1.245 millionfollowing EGM in June

    Placement and Rights Issue expected to be at $0.20 per share with 1for 1 attaching Option (exercisable at $0.20, prior to 31 December2019)

    Note: Funding based on 1 for 25 share consolidation to bring shareprice to a minimum of 20 cents. (Consolidation ratio may change)

    Timing and Funding

  • The Company will seek to raise approximately $4.25million, subject toShareholder approval at the EGM in June 2015 and Completion

    The expected allocation of funds is as follows:- Expansion of Berkeley Vale Commercial Facility $3,000,000- Completion of Transaction $750,000- Working Capital $500,000

    It is planned to expand the capacity of the Berkeley Vale CommercialFacility to 200 tonnes plastics feedstock per day by mid-2016, andincrease the plant utilization to the desired target of 90% by end 2016

    The funds raised of $3million plus surplus cash flow from the operationof the Berkeley Vale facility is currently considered to be adequate toachieve this expansion

    The surplus cash flow from the expanded Berkeley Vale CommercialFacility is planned to be used to develop further waste plasticconversion facilities on the East Coast of Australia

    Use of Funds

  • FEEDSTOCK The feedstock for the Berkeley Vale Commercial Facility is waste plastic

    generated from commercial and domestic use Currently this waste plastic is dumped in landfills, with a small percentage

    recycled IGE has advised that commercial arrangements are being finalized with

    waste plastic aggregators and large industrial producers of waste plastic, toprovide a secure long term supply of feedstock to Berkeley Vale in therange of $150 to $250 per tonne (including granulation to optimum size anddelivery)

    IGE has advised that a feedstock contract has been executed for the supplyof 1,000 tonnes per month for three years which will allow for the first yearsproduction requirements and the basis to ramp up to 200 tpd per day

    The recycling of this waste plastic avoids landfill dumping costs andprolongs the life of the landfills, providing significant environmental benefitto the large population centres on the East Coast

    Feedstock and Product

  • PRODUCT The Berkeley Vale Commercial Facility has been designed with the

    objective of producing diesel and petrol which meets Australian FuelStandards

    Due diligence completed by the Company has determined there is aready market for these standard commodities

    At the maximum throughput of the Berkeley Vale Commercial Facility of200tpd of feedstock, the analysis completed by IGE (which is cur