CORPORATE DIRECTORY
GOLD MOUNTAIN LIMITED
ABN 95 112 425 788
ASX: GMN
Directors
Share Register
Graham Kavanagh Non-Executive Chairman
Boardroom Pty Limited
Matthew Morgan Non-Executive Director
Sin Pyng “Tony” Teng Non-Executive Director
Grosvenor Place, Level 12, 225 George Street,
SYDNEY NSW 2000,
GPO Box 3993, SYDNEY NSW 2001
Management
Eric Kam Company Secretary
David Clark Chief Financial Officer
Registered and Principal Office
Suite 2501, Level 25
31 Market Street
SYDNEY NSW 2000 Australia
Telephone: +61 2 9283 3880
Facsimile: +61 2 9477 5565
info@goldmountainltd.com.au
www.goldmountainltd.com.au
Telephone: 1300 737 760
Facsimile: 1300 653 459
Solicitor
HWL Ebsworth Lawyers
Level 14, Australia Square
264 – 278 George Street
SYDNEY NSW 2000
Banker
Australia and New Zealand Banking Group Limited
Westpac Banking Corporation Limited
Auditor
KS Black & Co. Chartered Accountants
Level 6, 350 Kent Street, SYDNEY NSW 2000
GOLD MOUNTAIN LIMITED ANNUAL REPORT
1
TABLE OF CONTENTS
CORPORATE DIRECTORY ............................................................................................................................................... 1
LETTER TO SHAREHOLDERS .......................................................................................................................................... 2
DIRECTORS’ REPORT ...................................................................................................................................................... 4
INTERESTS IN THE SHARES AND OPTIONS OF THE COMPANY ............................................................................ 5
OPERATIONS REPORT ................................................................................................................................................ 8
REMUNERATION REPORT (Audited) ......................................................................................................................... 15
SCHEDULE OF TENEMENTS ......................................................................................................................................... 21
AUDITOR’S INDEPENDENCE DECLARATION ............................................................................................................... 22
STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME .......................................................... 23
STATEMENT OF FINANCIAL POSITION ......................................................................................................................... 24
STATEMENT OF CHANGES IN EQUITY ......................................................................................................................... 25
STATEMENT OF CASHFLOWS ....................................................................................................................................... 26
NOTES TO THE FINANCIAL STATEMENTS ................................................................................................................... 27
DIRECTORS’ DECLARATION .......................................................................................................................................... 52
INDEPENDENT AUDITORS REPORT ............................................................................................................................. 53
ADDITIONAL SHAREHOLDER INFORMATION .............................................................................................................. 55
GOLD MOUNTAIN LIMITED ANNUAL REPORT
3
DIRECTORS’ REPORT
Your Directors submit the annual financial report of Gold Mountain Limited for the financial year ended 30 June 2015. In
order to comply with the provisions of the Corporations Act, the Directors’ report as follows:
KEY MANAGEMENT PERSONNEL DISCLOSURES
DIRECTORS
The names of Directors who held office during or since the end of the year and until the date of this report are as follows.
Directors were in office for this entire period unless otherwise stated.
Graham Kavanagh
(appointed 5 June 2014)
Matthew Morgan
(appointed 3 July 2014)
Sin Pyng “Tony” Teng
(appointed 9 July 2014)
Robert J Waring
(appointed 29 November 2010, resigned 11 July 2014)
Bill Richie Yang
(appointed 2 June 2014, resigned 18 July 2014)
Eric Kam
(appointed 5 June 2014, resigned 18 July 2014)
Names, qualifications, experience and special responsibilities
Graham Kavanagh
Non Executive Director from 5 June 2014, Non Executive Chairman from 9 July 2014
Qualifications
B Comm ASIA
Experience
Interest in shares
and Options
Directorships held in
other listed entities
Mr Kavanagh has an extensive background over more than 25 years in securities and fund
management, property investment and development as well as earlier experience in the
Department of Mines. He has held senior positions as securities analyst, general manager
and director in fund management and property investment.
None
Enhanced Oil & Gas Recovery Limited (ASX:EOR)
Matthew Morgan
Non Executive Director
Qualifications
BSc (Geology)
Experience
Interest in shares
and Options
Directorships held in
other listed entities
Mr Morgan brings over twenty years of experience in exploration and mine development with
companies including, inter alia, BHP Billiton, Rio Tinto and Theiss. Mr Morgan has filled CEO
and senior management roles in both listed and unlisted companies. His technical experience
has included exploration and mine geology, resource estimation, mine engineering and
operational management in minerals such as gold, iron ore and coal. In addition to his
experience in Australia, Mr Morgan has had international experience including Malaysia and
Mongolia, and has negotiated off-take mineral contracts with several foreign governments
750,000 ordinary shares
No directorships held of ASX listed entities in the past three years
GOLD MOUNTAIN LIMITED ANNUAL REPORT
4
Sin Pyng “Tony” Teng Non Executive Director, appointed 9 July 2014
Qualifications
B. Econ. Dip. Fin. Mangt. CPA, FAICD, AFAIM
Experience
Mr Teng has had experience as a management consultant and with merger and acquisitions,
corporate restructuring and public company capital raising. He was co-founder and former
director of Coalworks Limited that was acquired by Whitehaven in 2012 in a $200m takeover
bid.
Interest in shares
and Options
510,000 ordinary shares
7,610,000 ordinary shares (indirect interest)
Directorships held in
other listed entities
Icash Payment Systems Limited (ASX:ICP) (resigned 2012)
MANAGEMENT
Eric Kam
Company Secretary (appointed 9 July 2014)
Qualifications: FCPA, FCMA, MBA, MAICD
Mr Kam has extensive experience in finance and operations management across diverse businesses and industries in
engineering, construction, mining & resources, technology, finance, marketing and distribution. He is involved in
corporate change and listing of companies, and is on the board of several other companies. Mr Kam has had extensive
experience as Company Secretary in several public listed and unlisted companies.
David Clark
Chief Financial Officer
Qualifications: CA, CPA, AGIS, B Comm. (UNSW), MBA Executive (AGSM), Registered Tax Agent
Mr Clark is a Chartered Accountant, Chartered Secretary and Registered Tax Agent of over fifteen (15) years standing
and holds a Bachelor of Commerce degree from UNSW and a Master of Business of Administration (Executive) from the
Australian Graduate School of Management. Mr Clark is principal of D.W. Clark & Co., Chartered Accountant, an
innovative, results-driven chartered accounting practice providing corporate financial, taxation and secretarial services
and advice to listed and unlisted companies in the mineral exploration and oil and gas industries.
INTERESTS IN THE SHARES AND OPTIONS OF THE COMPANY
DIRECTORS’ SHAREHOLDINGS
As at the date of this report, the interests of the Directors in the securities of Gold Mountain Limited were:-
Shares and Options
Shares and Options
Director
Name
Direct
Graham Kavanagh
Nil
Indirect
Nil
Matthew Morgan
Nil
850,000 shares
Sin Pyng “Tony” Teng
510,000 shares
7,610,000 shares
GOLD MOUNTAIN LIMITED ANNUAL REPORT
5
MOVEMENT IN EQUITY INSTRUMENTS (OTHER THAN OPTIONS AND RIGHTS)
Details of the movement in equity instruments (other than options and rights) held directly, indirectly or beneficially by
Directors and Key Management Personnel and their related parties are as follows:
30 June 2015
Graham Kavanagh 1
Matthew Morgan 2
Sin Pyng “Tony” Teng 3
Chris Battye 4
Wesley Harder 4
Robert Waring 5, 6
Keith Taylor
David Clark
Total
30 June 2014
Graham Kavanagh 1
Matthew Morgan 2
Sin Pyng “Tony” Teng 3
Chris Battye 4
Wesley Harder 4
Robert Waring 5, 6
Keith Taylor
David Clark
Total
Balance at
beginning of the
Year
Granted as
remuneration
during the Year
-
500,000
1,020,000
-
3,012,044
2,337,820
2,469,999
1,250,000
10,589,863
-
-
-
-
-
-
-
-
-
Issued on
Exercise of
Options during
the Year
-
250,000
-
-
-
-
-
-
Other changes
during the Year
Balance at end of
the Year
-
-
-
750,000
6,600,000
7,620,000
-
(3,012,044)
(2,337,820)
(2,469,999)
(1,250,000)
-
-
-
-
-
250,000
(2,469,863)
8,370,000
Balance at
beginning of the
Year
Granted as
remuneration
during the Year
Issued on
Exercise of
Options during
the Year
-
-
-
-
-
-
8,005,000
1,425,933
561,111
1,425,933
741,666
849,764
388,888
-
54,444
694,407
10,211,985
3,935,161
-
-
-
-
-
-
-
-
-
Other changes
during the Year
Balance at end of
the Year
-
-
500,000
500,000
1,020,000
1,020,000
(9,430,933)
-
1,025,000
3,012,044
1,207,266
2,337,820
1,620,235
2,469,999
501,149
1,250,000
(3,557,283)
10,589,863
1 GE Kavanagh was appointed a non executive director at the general meeting of memebers held on 5 June 2014
2 M Morgan was appointed a non executive director on 3 July 2014
3 Sin Pyng “Tony” Teng was appointed a non executive director on 9 July 2014
4 C Battye was removed as a non exeutive director at the general meeting of memebers held on 5 June 2014
4 WM Harder was removed as a non exeutive director at the general meeting of memebers held on 5 June 2014
5 RJ Waring resigned as a non executive director on 11 July 2014;
6 In addition, RJ Waring is a Director and substantial shareholder in, but he does not have a relevant interest in, Oakhill
Hamilton Pty Ltd, a company which holds 20,000 ordinary shares in Gold Mountain Limited.
Exercise of Options
250,000 ordinary shares were issued by the Company during and/or since the end of the financial year as a result of the
exercise of options. There are no unpaid amounts on the shares issued.
GOLD MOUNTAIN LIMITED ANNUAL REPORT
6
Options and Rights Holdings
Details of movements in options and rights held directly, indirectly or beneficially by Directors and Key Management
Personnel and their related parties are as follows:
Net change
Other
Balance at
end of period
30 June 2015
Balance at
beginning of
period
Granted as
remuneration
Graham Kavanagh
-
Matthew Morgan
250,000
Sin Pyng “Tony” Teng
Wesley Harder
Robert Waring
Keith Taylor
Jason Needham
Total
-
437,500
490,832
437,500
1,000,000
2,615,832
-
-
-
-
-
-
-
-
Options
exercised or
vested
-
(250,000)
-
-
-
-
-
-
-
-
(437,500)
(490,832)
(437,500)
(500,000)
(250,000)
(1,865,832)
-
-
-
-
-
-
500,000
500,000
30 June 2014
Graham Kavanagh
Matthew Morgan
Sin Pyng “Tony” Teng
Wesley Harder
Robert Waring
Keith Taylor
Jason Needham
Total
Balance at
beginning of
period
Granted as
remuneration
Options
exercised or
vested
Net change
Other
Balance at
end of period
-
-
-
-
-
-
1,000,000
1,000,000
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
250,000
250,000
-
437,500
490,832
437,500
-
1,615,832
-
437,500
490,832
437,500
1,000,000
2,615,832
Options on issue at the date of this report are:-
Grant Date
16 Mar 2011
16 Mar 2012
Dividends
Number
750,000
500,000
Expiry Date
31 Dec 2015
31 Dec 2016
Exercise price
$0.30
$0.07
Number of holders
1
1
No dividends have been paid or declared since the start of the financial year and/or the Directors do not recommend the
payment of a dividend in respect of the financial year.
GOLD MOUNTAIN LIMITED ANNUAL REPORT
7
OPERATIONS REPORT
Principal Activities
The principal activity of the Company during the financial period was to acquire, explore and develop areas that are
highly prospective for gold and other precious and base metals and minerals in Australia, Papua New Guinea and
elsewhere.
Operating and Financial Review
(i)
Operations
Gold Mountain is an exploration company operating in Australia and Papua New Guinea to acquire, explore and develop
areas that are highly prospective for gold and other precious and base metals and minerals.
The Company creates value for shareholders, through exploration activities which develop and quantify mineral assets.
Once an asset has been developed and quantified within the framework of the JORC guidelines the Company may elect
to move to production, to extract and refine ore which is then sold as a primary product.
The Company is actively exploring and developing gold projects in Australia and Papua New Guinea.
Please refer to the Review of Operations for more information on the status of the projects.
(ii)
Financial Performance & Financial Position
The Company listed on the Australian Securities Exchange (ASX) on 2 September 2011 as Commissioners Gold
Limited. Following shareholder approval at the 2014 AGM, the Company changed its name to Gold Mountain Limited on
16 December 2014. The financial results of the Company for the five (5) years to 30 June 2015 are:
30 June 2015
30 June 2014
30 June 2013
30 June 2012
30 June 2011
Cash and cash equivalents
759,938
200,070
51,406
513,888
1,343,844
Net assets
2,460,399
1,371,820
567,107
1,333,159
521,815
Revenue & financial income
5,046
38,151
13,293
28,627
12,114
Net loss after tax
(847,685)
(526,993)
(1,559,101)
(935,084)
(298,175)
EBITDA
(659,879)
(468,681)
(742,346)
(598,035)
(180,091)
Share price at 30 June
Loss per share (cents)
$0.039
(0.57)
$0.023
(0.69)
$0.034
(3.58)
$0.044
Not applicable
(2.80)
(1.62)
a)
Financial Performance
The net loss after tax of the Company for the financial year after tax amounted to $847,685 (2014: Loss $526,993).
The Company is creating value for shareholders through its exploration expenditure and currently has no revenue
generating operations. Revenue and financial income are generated from interest income from funds held on deposit and
miscellaneous income. As the average funds held on deposit have increased during the year, accordingly interest
income has increased from no interest income when compared to the prior year.
During the year, the operations relating to the Papua New Guinea gold project expanded as the Company undertook a
rapid exploration program, accordingly capitalised exploration increased from $626,376 in the 2014 FY to $1,210,941 in
the 2015 FY. Personnel and external consulting requirements increased, which resulted in an increase of legal and
professional costs from $163,662 in the 2014 FY to $314,225 in the 2015 FY. The Company also had an increase in
GOLD MOUNTAIN LIMITED ANNUAL REPORT
8
travel expenses from $2,017 in the 2014 FY to $24,744 in the 2015 FY arising from the Papua New Guinea gold
exploration program and the capital raising and promotion activities undertaken by the Mr Matthew Morgan and Mr Sin
Pyng “Tony” Teng. There has been a decrease in public and investor relations expense from $15,139 in the 2014 FY to
$12,233 in the 2015 FY.
b)
Financial Position
The Company’s main activity during the year was the investment of cash of $759,938 (2014: $200,070). The carrying
value of the exploration assets and the capitalised exploration assets increased 130% to $1,443,522 (2014: $626,376).
The 30 June 2015 financial report has been prepared on the going concern basis that contemplates the continuity of
normal business activities and the realisation of assets and extinguishment of liabilities in the ordinary course of
business. For the year ended 30 June 2015, the Company recorded a loss after tax of $846,545 (2014: $526,993) and
had a net working capital surplus of $579,996 (30 June 2014: Surplus of $170,733).
On 28 May, 2015 the Company announced that an Underwriting Agreement had been entered into with Mr Seah Gak
San of Malaysia in respect of 27,733,455 unlisted options which were due to expire on 29 May, 2015. On 4 June 2015,
8,530,555 new fully paid ordinary shares were issued at $0.04 each upon the exercise of these options to raise
$341,222. Subsequent to the end of the year, on 15 July, 2015, 19,510,000 ordinary shares were issued to sophisticated
investors at $0.04 each pursuant to the Underwriting Agreement to raise $780,400.
As the Company is an exploration and development entity, ongoing exploration and development activities are reliant on
future capital raisings. Based on these facts, the Directors consider the going concern basis of preparation to be
appropriate for this financial report.
(iii)
Business Strategies and Prospects for future financial years
The Company actively evaluates the prospects of each project as results from each program become available, these
results are available via the ASX platform for shareholders information. The Company then assesses the continued
exploration expenditure and further asset development. The Company will continue the evaluation of its mineral projects
in the future and undertake generative work to identify and acquire new resource projects.
There are specific risks associated with the activities of the Company and general risks which are largely beyond the
control of the Company and the Directors. The risks identified below, or other risk factors, may have a material impact on
the future financial performance of the Company and the market price of the Company’s shares.
a)
Operating Risks
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,
sovereign risk 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 consumables, spare
parts, plant and equipment.
b)
Environmental Risks
The operations and proposed activities of the Company are subject to the laws and regulations of Australia and Papua
New Guinea concerning the environment. 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. It is the Company’s intention to conduct its activities to the highest standard of environmental obligation,
including compliance with all environmental laws.
c)
Economic
General economic conditions, 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.
GOLD MOUNTAIN LIMITED ANNUAL REPORT
9
d)
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:
(i)
(ii)
(iii)
(iv)
(v)
(vi)
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.
e)
Additional requirements for capital
The Company’s capital requirements depend on numerous factors. Depending on the Company’s ability to generate
income, the Company will require further financing. 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
programs 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.
f)
Speculative investment
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 Company’s shares. Potential investors should consider that
the investment in the Company is speculative and should consult their professional advisers before deciding whether to
invest.
5.
Significant Changes in the State of Affairs
On 3 July, 2014, the Company appointed Mr Matthew Morgan as a Non Executive Director.
On 9 July, 2014, the Company appointed Mr Sin Pyng “Tony” Teng as a Non Executive Director. On the same day, Non
Executive Director Mr Graham Kavanagh was appointed Chairman by the Board of Directors.
On 11 July, 2014, Non Executive Director Mr Robert Waring resigned as a Director of the Company.
On 18 July, 2014, Non Executive Directors Mr Bill Richie Yang and Eric Kam resigned as Directors of the Company.
On 1 August 2014, the Company completed a successful capital raising of $390,000 through the issue of 13,000,000
ordinary shares at $0.03 per share by way of a private placement to professional and sophisticated investors.
On 15 December 2014, the Company completed a successful capital raising of $300,000 through the issue of
10,000,000 ordinary shares at $0.03 per share by way of a private placement to professional and sophisticated investors.
On 15 December 2014, the Company announced the results of the Company’s Annual General Meeting where
shareholders ratified the issue of securities during the period. The Company changed its name from Commissioners
Gold Limited to Gold Mountain Limited following the approval of Resolution 4 in the Notice of Annual General Meeting.
On 19 December 2014, 8,000,000 ordinary shares were issued when 8,000,000 convertible notes were converted to
ordinary shares at the conversion price of $0.025 per share following shareholder approval of Resolution 10 of the
Annual General Meeting held on 15 December 2014. The Company raised $200,000 in cash when the convertible notes
were first issued in June 2014.
On 6 January 2015, the Company announced it had entered into an agreement to acquire the remaining unearned
interest in the Cowarra Gold Project EL5939 from the current tenement holder and joint venture partner Capital Mining
GOLD MOUNTAIN LIMITED ANNUAL REPORT
10
Limited (ASX: CMY). GMN paid a security deposit of $20,000 and a further $20,000 is payable as final settlement upon
completion of the registration of transfer with the NSW Department of Trade and Investments, Resources and Energy.
On 27 February 2015, the Company completed a successful capital raising of $843,099 through the issue of 28,103,300
ordinary shares at $0.03 per share by way of a private placement to professional and sophisticated investors.
On 2 March 2015 and 9 March 2015, the Company released Stage 1 exploration results from the Sak Creek and Crown
Ridge prospects respectively, within EL1966, Enga Province, Papua New Guinea.
On 30 April 2015, the Company announced Goldsmith Resources SAC (GRSAC) has entered into a Binding Agreement
with Montan Mining Corporation of Vancouver Canada to acquire processing facility in Peru subject to conditions
precedent for a total consideration of USD $3,300,000. GMN holds an 18.75% minority interest in GRSAC.
On 12 May 2015, the Company released Stage 2 exploration results from the Crown Ridge prospects within EL1966,
Enga Province, Papua New Guinea.
On 20 May 2015, the Company announced Stage 3 exploration had commenced at the Crown Ridge prospects within
EL1966, Enga Province, Papua New Guinea under the supervision of senior geologist, Mr Douglas Smith.
On 27 May 2015, the Company announced it had completed the due diligence enquiries in relation to Viva No. 20
Limited (Viva) and the three (3) exploration licences and the exploration licence application in Papua New Guinea held
by Viva. The Company also announced it was now proceeding to finalise completion of its acquisition of shares
comprising 20% of the issued capital of Viva.
On 5 June 2015 8,530,555 shares were issued from the exercise of 8,530,555 unlisted options at an exercise price of
$0.04 which were exercised prior to the expiry date of 29 May 2015.
On 12 June 2015, the Company received $10,000 from Mr Matthew Morgan through the exercise of unlisted options
which were converted to 250,000 shares at $0.04 per share.
Review of Operations
Wabag Gold Project - Papua New Guinea
On 30 June 2014, GMN entered into a binding Heads of Agreement with the shareholders of Viva No.20 Limited (Viva), a
company incorporated in PNG, to acquire a 20% interest and an option to acquire a further 50% interest together with all
relevant information, data and all geological records held by Viva in relation to three granted exploration licences subject
to certain independent due diligence requirements and other conditions precedent.
Under the agreement, Viva granted GMN a five month exclusive dealing period in which to undertake due diligence,
satisfy various conditions precedent, and complete a transaction to acquire shares in Viva. GMN has paid to Viva a non-
refundable fee of A$75,000.
In May 2015, the Company completed due diligence requirements and is now proceeding to finalise completion of its
acquisition of shares comprising 20% of the issued capital of Viva.
Subsequent to the end of the financial year, on 31 July 2015, the Company entered into a share purchase agreement
with Viva and its shareholders to acquire a further 50% interest in Viva through the acquisition of shares from the Viva
shareholders as contemplated by the Notice of AGM issued by the Company in November 2014.
The project is located in the highlands province of Enga, immediately adjacent to the township of Wabag and 75km NW
of the regional centre of Mt Hagen. The project covers a suite of Miocene intermediate intrusive rocks, related volcanics
and younger metasediments of the New Guinea Thrust Belt, a strongly mineralised structural zone which dominates the
central-northern highlands of PNG. Intermediate intrusives at Wabag were emplaced during the Maramuni event, a Belt-
wide igneous and mineralising event.
The geology at Wabag has similar characteristics to the geology hosting notable high grade prospects such as Frieda
River, Trukai, North Dlbom and Nena. Previous exploration has identified high grade gold and platinum anomalies in
stream sediments. The most notable being around Timun in the south where approximately 100 kg of alluvial gold has
been previously recovered. Timun and Kompiam are accessible by road from Wabag enabling exploration of that part of
the licenced area.
The exploration results completed during the financial year and to date are extremely encouraging. In March 2015, the
Company released Stage 1 exploration results from the Sak Creek and Crown Ridge prospects, within EL1966, Enga
Province, Papua New Guinea. On 12 May 2015, the Company released Stage 2 exploration results from the Crown
GOLD MOUNTAIN LIMITED ANNUAL REPORT
11
Ridge prospects within EL1966, Enga Province, Papua New Guinea. On 20 May 2015, the Company announced Stage 3
exploration had commenced at the Crown Ridge prospects within EL1966, Enga Province, Papua New Guinea under the
supervision of senior geologist, Mr Douglas Smith.
The Board is of the belief the Wabag PNG acquisition may offer an opportunity to ultimately deliver a material project for
the benefit of the Company and shareholders.
Goldsmiths Resources SAC-Peru
Goldsmith Resources SAC is a Peruvian company in which Gold Mountain holds an 18.75% shareholding. Goldsmith is
focussed on a gold project in southern Peru, centred on a mineral processing plant at Mollehuaca, satellite mining
operations at Eladium and additional prospective exploration and mining ground within the Nazca-Ocoña metallogenic
belt a well-established mining region which hosts a number of medium-sized, high-grade operating gold mines.
On 30 April, 2015, the Company announced Goldsmith Resources SAC (“GRSAC”) entered into a Binding Agreement on
behalf of its shareholders’ interest with Montan Mining Corporation of Vancouver Canada (TSXV: MNY) (“Montan”) to
acquire the Peruvian Project subject to conditions precedent for a total consideration of USD $3,300,000. Further details
of this transaction are disclosed at Note 10 in the Notes to the Financial Statement.
GMN Director Matthew Morgan represents the Company on the board of Goldsmith Resources SAC.
NSW Gold Exploration Projects
Cowarra NSW-Exploration Licence 5939
GMN holds a 50% interest and can earn up to 85% under a farm-in agreement on expenditure of a further $350,000. On
6 January 2015, the Company announced it had entered into an agreement to acquire the remaining unearned interest in
the Cowarra Gold Project EL5939 from the current tenement holder and joint venture partner Capital Mining Limited
(ASX: CMY). GMN paid a security deposit of $20,000 and a further $20,000 is payable as final settlement upon
completion of the registration of transfer with the NSW Department of Trade and Investments, Resources and Energy.
Cowarra is a gold mineralisation project 2.8 km by 300-400m and to date a JORC inferred resource of 38,000 ozs in
open pittable oxides has been identified. Good access, power and water is readily available. Further exploration will be
required to establish an economic reserve and progress it to project status.
Oberon NSW
Under a farm-in agreement with Central West Gold NL (ASX: CWG) GMN could earn a 70% interest in the EL by funding
exploration to $350,000. Exploration expenditure of $150,000 had been expended to 30 June 2014 and the remaining
$200,000 was required to be expended by November 2014 unless the farm-in agreement was extended. This tenement
was considered low priority and GMN notified CWG that GMN will not be providing further funding for exploration. As a
result, CWG have allowed the exploration licence to expire at the end of the current term.
Dalton NSW-Exploration Licence 6922
This Exploration Licence in which GMN has a 100% interest consists of a regional shear zone hosting gold
mineralisation. Shallow rotary core drilling has returned a high gold value of 32g/t over 1 metre. Follow up work is
planned along strike in a northerly direction. The licence covers a number of historic workings. Expenditure
commitments to 2015 total $154,500.
Grenfell NSW
The Company holds a 100% interest in Exploration Licence 8263 granted on 16 May 2014 and covers the historic
Grenfell gold field in Central NSW. EL 8263 embraces 22 shallow gold quartz reefs which were worked a century ago to
produce approximately 150,000 ozs of gold. The exploration plan is to focus on possible extensions on the line of strike
from the old gold workings and subsequently at depth.
GOLD MOUNTAIN LIMITED ANNUAL REPORT
12
Capital Raisings
During the reporting period, the Company conducted several rounds of capital raisings. In total, the Company raised
$1,874,321 to fund ongoing operations in Papua New Guinea and Australia.
Capital Raising
Date
Shares Issued
Price
Amount Raised
Placement
Placement
1 August 2014
18 December 2014
Convertible note conversion 18 December 2014
Placement
27 February 2015
Exercise of unlisted options
4 June 2015
13,000,000
10,000,000
8,000,000
28,103,300
8,530,555
87,143,855
$0.030
$0.030
$0.025
$0.030
$0.040
$390,000
$300,000
**
$843,099
$341,222
$1,874,321
** Funds of $200,000 from the convertible notes were received on 30 June 2014 when the notes were first issued.
On 1 August 2014, the Company completed a successful capital raising of $390,000 through the issue of 13,000,000
ordinary shares at $0.03 per share by way of a private placement to professional and sophisticated investors.
On 15 December 2014, the Company completed a successful capital raising of $300,000 through the issue of
10,000,000 ordinary shares at $0.03 per share by way of a private placement to professional and sophisticated investors.
On 19 December 2014, 8,000,000 ordinary shares were issued when 8,000,000 convertible notes were converted to
ordinary shares at the conversion price of $0.025 per share following shareholder approval of Resolution 10 of the
Annual General Meeting held on 15 December 2014. The Company raised $200,000 in cash when the convertible notes
were first issued in June 2014.
On 27 February 2015, the Company completed a successful capital raising of $843,099 through the issue of 28,103,300
ordinary shares at $0.03 per share by way of a private placement to professional and sophisticated investors.
On 5 June 2015 8,530,555 shares were issued from the exercise of 8,530,555 unlisted options at an exercise price of
$0.04 which were exercised prior to the expiry date of 29 May 2015.
Risk management
Details of the Company’s Risk Management policies are contained within the Corporate Governance Statement.
Corporate Governance
A statement disclosing the extent to which the Company has followed the best practice recommendations set by the ASX
Corporate Governance Council during the period is displayed on the Company’s website.
Subsequent events after balance date
On 15 July, 2015, 19,510,000 ordinary shares were issued to sophisticated investors at $0.04 each pursuant to the
Underwriting Agreement to raise $780,400. Previously, on 28 May, 2015 the Company announced that an Underwriting
Agreement had been entered into with Mr Seah Gak San of Malaysia in respect of 27,733,455 unlisted options which
were due to expire on 29 May, 2015.
On 31 July 2015, the Company announced it had entered into a share purchase agreement with Viva No. 20 Limited
(Viva) and its shareholders (Viva shareholders) to acquire a further 50% interest in Viva through the acquisition of shares
from the Viva shareholders as contemplated by the Notice of AGM issued by the Company in November 2014.
There has not been any other matter or circumstance that has arisen after balance date that has significantly affected, or
may significantly affect, the operations of the Company, the results of those operations, or the state of affairs of the
Company in future financial periods.
GOLD MOUNTAIN LIMITED ANNUAL REPORT
13
Environmental legislation
The Company is subject to significant environmental and monitoring requirements in respect of its natural resource
exploration activities. The Directors are not aware of any significant breaches of these requirements during the period.
Indemnification and insurance of Directors and Officers
The Company has agreed to indemnify all the Directors of the Company for any liabilities to another person (other than
the Company or related entity) that may arise from their position as Directors of the Company, except where the liability
arises out of conduct involving a lack of good faith.
During the financial year, GMN paid a premium in respect of a contract insuring the Directors and officers of the
Company against any liability incurred in the course of their duties to the extent permitted by the Corporations Act 2001.
The contract of insurance prohibits disclosure of the nature of the liability and the amount of the premium.
Options
No options over issued shares or interest in the Company were granted during or since the end of the financial year.
GOLD MOUNTAIN LIMITED ANNUAL REPORT
14
REMUNERATION REPORT (AUDITED)
The Board, in consultation with the Remuneration Committee, is responsible for determining and reviewing
compensation arrangements for the directors and executive management. The Board assesses the appropriateness of
the nature and amount of remuneration of key personnel on an annual basis. In determining the amount and nature of
officers’ packages, the Board takes into consideration the Company’s financial and operational performance along with
industry and market conditions.
The Committee has the authority to retain any outside advisor at the expense of the Company, without the Board’s
approval, at any time and has the authority to determine any such advisor’s fees and other retention terms.
In setting corporate goals and objectives relevant to Senior Executives’ compensation, the Committee considers both
short-term and long-term compensation goals and the setting of criteria around this. In relation to setting Directors’
remuneration the Committee looks at and considers comparative data from similar companies.
This report outlines the remuneration arrangements in place for Directors and Key Management Personnel of Gold
Mountain Limited (the “company”) for the financial year ended 30 June 2015.
The following persons acted as Directors during or since the end of the financial year:
Graham Kavanagh
Matthew Morgan
Sin Pyng “Tony” Teng
Robert J Waring
Bill Richie Yang
Eric Kam
The term ‘Key Management Personnel’ is used in this remuneration report to refer to the following persons. Except as
noted, the named persons held their current position for the whole of the financial year and since the end of the financial
year:
Graham Kavanagh
Matthew Morgan
Sin Pyng “Tony” Teng
Remuneration Philosophy
Robert J Waring
Bill Richie Yang
Eric Kam
David Clark
The performance of the Company depends upon the quality of the Directors and executives. The philosophy of the
Company in determining remuneration levels is to:
set competitive remuneration packages to attract and retain high calibre employees;
link executive rewards to shareholder value creation; and
establish appropriate, demanding performance hurdles for variable executive remuneration
Remuneration Committee
The Remuneration Committee of the Board of Directors of the Company is responsible for determining and reviewing
compensation arrangements for the Directors and the Senior Management team.
The Remuneration Committee assesses the appropriateness of the nature and amount of remuneration of Directors and
senior executives on a periodic basis by reference to relevant employment market conditions with an overall objective of
ensuring maximum stakeholder benefit from the retention of a high quality Board and executive team.
GOLD MOUNTAIN LIMITED ANNUAL REPORT
15
Remuneration Structure
In accordance with best practice Corporate Governance, the structure of Non-Executive Director and executive
remuneration is separate and distinct.
Non-Executive Director Remuneration
The Board seeks to set aggregate remuneration at a level that provides the Company with the ability to attract and retain
Directors of the highest calibre, whilst incurring a cost that is acceptable to shareholders.
Each Director is entitled to such remuneration from the Company as the Directors decide, but the total amount provided
to all non-executive directors must not exceed in aggregate the amount fixed by the Company in a general meeting. The
aggregate remuneration for all non-executive directors has been set at an amount of $300,000 per annum.
The ASX Listing Rules specify that the aggregate remuneration of Non-Executive Directors shall be determined from
time to time by a general meeting.
The amount of aggregate remuneration sought to be approved by shareholders and the manner in which it is apportioned
amongst Directors is reviewed annually. The Board considers advice from external shareholders as well as the fees paid
to Non-Executive Directors of comparable companies when undertaking the annual review process.
Each Director is entitled to receive a fee for being a Director of the Company.
The remuneration of Non-Executive Directors for the year ended 30 June 2015 is detailed in the Remuneration of
Directors and named executives section of this report on the following pages of this report.
Senior Manager and Executive Director Remuneration
Remuneration consists of fixed remuneration and Company options (as determined from time to time). In addition to the
Company employees and Directors, the Company has contracted key consultants on a contractual basis. These
contracts stipulate the remuneration to be paid to the consultants.
Fixed Remuneration
Fixed remuneration is reviewed annually by the Independent Directors’ Committee (which assumes the role of the
Remuneration Committee). The process consists of a review of relevant comparative remuneration in the market and
internally and, where appropriate, external advice on policies and practices. The Committee has access to external,
independent advice where necessary.
Fixed remuneration is paid in the form of cash payments.
The fixed remuneration component of the six most highly remunerated Company executives is detailed in Table 1.
Employment Contracts
During the year and to the date of this report there are no employment contracts with the Company.
GOLD MOUNTAIN LIMITED ANNUAL REPORT
16
Remuneration of Directors and named executives
Table 1: Directors’ and named executives remuneration for the year ended 30 June 2015
Short-term employee benefits
Salary &
Fees
Bonuses
Non-
Monetary
Benefits
Post-employment
benefits
Equity
Other
Total
%
Super-
annuation
Prescribed
Benefits
Options
Shares
Deferred
Benefits
Performance
Related
Graham Kavanagh 1
39,600
Matthew Morgan 2
Sin Pyng “Tony”
Teng 3
Robert J Waring
Bill Richie Yang
Eric Kam 4
Keith Taylor
Jason Needham 5
David Clark 6
Total
100,000
100,000
-
-
72,000
-
4,900
24,405
340,905
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
1,140
-
-
-
-
-
-
1,140
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
39,600
100,000
100,000
-
-
72,000
-
4,900
24,405
342,045
0%
0%
0%
-
-
0%
-
0%
0%
-
1. Paid to Drumcliffe Investments Pty Ltd for corporate advisory services of which Mr Kavanagh is a director and shareholder.
2. Paid to Mineral X Pty Ltd for corporate advisory services of which Mr Morgan is a director and shareholder.
3. Paid to Rodby Holdings Pty Ltd for corporate advisory services of which Mr Teng is a director and shareholder.
4. Paid to Useful Ways Pty Ltd for corporate advisory services of which Mr Kam is a director and shareholder.
5. Paid to Double Felix Pty Ltd for corporate advisory services of which Mr Needham is a director and shareholder.
6. Paid to D.W. Clark & Co., Chartered Accountant for corporate advisory services of which Mr Clark is principal.
GOLD MOUNTAIN LIMITED ANNUAL REPORT
17
Table 2: Directors’ and named executives remuneration for the year ended 30 June 2014
Short-term employee benefits
Post-employment
benefits
Equity
Other
Total
%
Salary &
Fees
Bonuses
Non- Monetary
Benefits
Super-
annuation
Prescribed
Benefits
Options
Shares
Deferred
Benefits
Performance
Related
Graham Kavanagh
Matthew Morgan
Sin Pyng “Tony”
Teng
-
-
-
Christopher Battye
35,000
Wesley Harder
Robert J Waring 1
Bill Richie Yang
Eric Kam
Keith Taylor 2
35,000
65,376
2,916
-
35,000
Jason Needham
100,000
David Clark 3
30,966
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
7,888
-
-
-
-
-
-
-
-
-
-
-
-
Total
304,258
-
-
7,888
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
7,206
7,206
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
35,000
35,000
65,376
2,916
-
35,000
107,888
38,172
319,352
1. Salary & Fees component paid to Oakhill Hamilton Pty Ltd for corporate advisory services of which Mr Waring is a director and shareholder.
2. Paid to Davington Advisory Pty Ltd for secretarial services of which Mr Taylor is a director and shareholder.
3. Paid to D.W. Clark & Co., Chartered Accountant for corporate advisory services of which Mr Clark is principal.
-
-
-
-
-
-
-
-
-
-
-
-
GOLD MOUNTAIN LIMITED ANNUAL REPORT
18
Other Key Management Personnel Transactions
The Company has established the Gold Mountain Limited Employee Share Option Plan (ESOP) and a summary of the
terms and conditions of the Plan are set out below:
i.
ii.
iii.
iv.
All employees (full time and part time) will be eligible to participate in the Plan.
Options are granted under the Plan at the discretion of the board and if permitted by the board, may be
issued to an employee's nominee.
Each option is to subscribe for one ordinary share in the Company and will expire 5 years from its date of
issue. An option is exercisable at any time from its date of issue provided all relevant vesting conditions, if
applicable, have been met. Options will be issued free. The exercise price of options will be determined by
the board. The total number of shares the subject of options issued under the Plan, when aggregated with
issues during the previous 5 years pursuant to the Plan and any other employee share plan, must not exceed
5% of the Company's issued share capital.
If, prior to the expiry date of options, a person ceases to be an employee of the Company for any reason
other than retirement at age 60 or more (or such earlier age as the board permits), permanent
disability, redundancy or death, the options held by that person (or that person's nominee)
automatically lapse on the first to occur of a) the expiry of the period of 30 days from the date of such
occurrence, and b) the expiry date. If a person dies, the options held by that person will be
exercisable by that person's legal personal representative.
v.
Options cannot be transferred other than to the legal personal representative of a deceased option
holder.
vi.
The Company will not apply for official quotation of any options.
vii.
Shares issued as a result of the exercise of options will rank equally with the Company's previously
issued shares.
viii. Option holders may only participate in new issues of securities by first exercising their options.
ix.
Options are granted under the plan for no consideration.
x.
Each share options converts into one ordinary shares of Gold Mountain Limited.
The Board may amend the terms and conditions of the plan subject to the requirements of the Listing Rules.
There have been no other transactions involving equity instruments other than those described in the tables above. For
details of other transactions with Key Management Personnel, refer to Note 18: Related Party Disclosures.
GOLD MOUNTAIN LIMITED ANNUAL REPORT
19