MINBOS RESOURCES LIMITED — Capital/Financing Update 2013

Mar 7, 2013

ASX ANNOUNCEMENT/MEDIA RELEASE

ASX ANNOUNCEMENT/MEDIA RELEASE
	ASX Code: MNB
	PERTH OFFICE
MINBOS SECURES UP TO A$5.5 MILLION IN FINANCE FACILITIES	Level 1, 278 Stirling Highway
	Claremont WA 6010
	Australia
	T: +61 8 9476 4500
 Provides funding for ongoing working capital and strategic partner assessment	E: info@minbos.com
 Made up of two facilities:	W:www.minbos.com
o Convertible note provided by Minbos management for A$500,000, with a	SOUTH AFRICAN OFFICE
conversion price equal to a 50% premium to VWAP	Ground Floor, Unit 1
o Funding agreement with a New York institution for up to A$5 million	Ferndale Mews
	15 Dover Street
ing phosphate developer Minbos Resources Limited (“Minbos”) (ASX:MNB) is pleased to nce it has completed separate financing arrangements with Lind Partners, LLC, the	Randburg Johannesburg 2194 South Africa

Emerging phosphate developer Minbos Resources Limited (“ Minbos ”) (ASX:MNB) is pleased to announce it has completed separate financing arrangements with Lind Partners, LLC, the manager of the Australian Special Opportunities Fund LP (together, “ Lind ”), and Minbos management to provide the Company with A$5.5 million in two separate finance facilities.

The facilities provide the Company with $875,000 upon completion. The two separate arrangements are provided via a $500,000 convertible note from Minbos management, and an initial $375,000 convertible security and equity issue tranche from Lind.

Lind is a New York-based alternative asset management company that manages a family of funds that selectively invests across a broad range of industries and economic environments. The team at Lind has been active in the Australian market for several years with past investments into KBL Mining Ltd, Legacy Iron Ore Ltd, Citigold Corporation Ltd, Carnegie Wave Energy Ltd, Minera Gold Ltd, Panterra Gold Ltd and Australian American Mining Corporation Ltd.

Under the agreement with Lind, Minbos will receive $375,000 on completion in the form of a $300,000 convertible security and $75,000 as a prepayment for ordinary shares in Minbos. Lind will further invest from $75,000 to $200,000 in monthly subscriptions, subject to conditions, over the next two years, for a maximum of $4,975,000.

Convertible Note Provided by Management

Under a separate funding arrangement, David Reeves (Minbos Non-executive Director) and James Carter (Minbos Chief Financial Officer) have agreed to provide the Company with $500,000 under a convertible note facility upon completion. The conversion price of each convertible note will be at a premium of 50% to the 20 day volume weighted average price (VWAP) of Minbos shares prior to the date of execution of the facility agreement. Interest is payable at a rate of 12% per annum with principal repayment or conversion in 9 months from the date of first drawdown.

The conversion of the convertible note issued to David Reeves will be subject to the receipt of Shareholder approval in general meeting.

MNB’s Managing Director Scott Sullivan said: “The agreements ensure that Minbos can continue to progress its strategic partner process that seeks a cornerstone investor in Minbos to advance the feasibility studies on both our Kanzi project in the DRC and our Cacata project in Angola. It also demonstrates the confidence Minbos’ executive has in our projects and the future growth potential of the company.”

ASX ANNOUNCEMENT/MEDIA RELEASE

Key features of the Unsecured $500,000 Convertible Note funding agreement:

• $500,000 convertible note;

• Conversion price at a 50% premium to Minbos’ 20 day VWAP prior to execution of the agreement;

• Funds are drawn down as and when required to minimise interest expense;

• Term 9 months after initial drawdown;

• Interest rate 12% per annum;

• Establishment fee 5% payable on each tranche drawdown;

• No options or other commitment or establishment fees; and

• Unsecured.

Conditions subsequent to the execution of the unsecured $500,000 convertible note funding agreement are Shareholder approval for David Reeves to enable the conversion of his note into fully paid ordinary shares.

Key features of the Lind funding agreement:

• An initial investment of $375,000 is available immediately upon execution of the Agreement and satisfaction of conditions precedent in the form of a $300,000 convertible security and $75,000 as a prepayment for ordinary shares of Minbos. The convertible security has a face value of $300,000 and a term of 24 months at a 0% interest rate;

• Over the next 24 months, a minimum of $75,000 of shares will be purchased by Lind from Minbos, approximately monthly, which may be increased to $200,000 by mutual consent, subject to compliance with the terms of the Agreement. Minbos has the right to pause the monthly tranche purchases for defined periods as specified in the Agreement. Monthly tranches may be reduced to $50,000 per month at Minbos’ sole discretion;

• Lind will be granted 1,150,000 options exercisable at 130% of the average daily volume weighted average price (VWAP) per share for the 20 consecutive trading days immediately prior to the date of the execution of the Agreement;

• Minbos will also pay Lind a commencement fee in Minbos shares to the value of $135,000, at an issue price equal to the average daily VWAPs for the 5 trading days prior to the execution date, and the agreement is also secured against 1,000,000 MNB shares;

• The price at which shares will be issued is 91% of the average of the 3 consecutive daily VWAPs during a specified period prior to the issuance of shares;

• On one occasion only, the purchase price may be 130% of the average daily VWAPs of the shares during the 20 trading day period prior to the execution of the Agreement.

The terms of the agreement with Lind expressly allow the Company to enter into future debt financing arrangements and to carry out additional private placements of equity, rights issues and shareholder purchase plans. In addition, the agreement does not restrict the Company’s ability to enter into strategic industry partnerships and undertake acquisitions of assets and shares in the future. The Company has the right to terminate the agreement at no cost at any time.

ASX ANNOUNCEMENT/MEDIA RELEASE

The conversion of the initial $300,000 Convertible Security is subject to the ratification of the shares previously issued under the 15% capacity under ASX Listing Rule 7.1, at the Company’s upcoming general meeting on 14 March 2013. The Agreement is conditional on Shareholder approval being obtained when required by ASX Listing Rule 7.1

ENDS

For further information please contact:

Scott Sullivan Managing Director scott@minbos.com +61 (0) 8 9476 4500

For media enquiries contact:

David Ikin – Professional Public Relations email: david.ikin@ppr.com.au (+61) 8 9388 0944

About Minbos

Minbos Resources Limited (ASX:MNB) is an ASX-listed exploration and development company focused on phosphate ore within the Cabinda Province of Angola and the adjoining areas of the far western DRC. Through its subsidiaries and joint ventures, the Company is exploring over 400,000ha of highly prospective ground hosting phosphate ore.

Minbos is focussing on the development of the high grade Cacata project in Cabinda and the high grade Kanzi project in the far western DRC whilst growing its current resource base in incremental stages on the remaining deposits in both areas.

The Company’s strategy is to specifically target the exploration and development of low cost fertiliser-based commodities in order to tap into the growing global demand for fertilisers. Phosphate is an essential component in certain agricultural fertilisers, with the market supported by the increasing global demand for food and bio-fuel products.

For more information, visit www.minbos.com

About The Lind Partners, LLC

The Lind Partners, LLC is a New York-based alternative asset management company and manager of the Australian Special Opportunity Fund, LP and the Canadian Special Opportunity Fund, LP. Lind selectively invests across a broad range of industries and economic environments with a focus on companies with market capitalizations ranging between $25 million and $1 billion having definable milestones and key inflection points that have the potential to create considerable shareholder value.

More information on The Lind Partners can be found at www.thelindpartners.com