No exploration was conducted during the December quarter.
Proposed sale of Mt Woods Copper-Gold JV interest and associated tenements
During the quarter, the Company entered into a non-binding heads of agreement (the "HoA") with OZ Minerals outlining the terms for the proposed sale of its 49% interest in the Mt Woods Copper-Gold JV to OZ Exploration Limited Pty Ltd ("Oz Exploration"), a wholly owned subsidiary of OZ Minerals.
IMX and OZ Exploration are parties to the Mt Woods Copper-Gold Joint Venture, whereby OZ Exploration have committed to spend A$20 million over five years to retain a 51% interest in the non-iron rights on IMX's Mt Woods tenements in South Australia. As at 30 September 2012, OZ Exploration had spent approximately A$14 million of the A$20 million.
Under the commercial terms set out in the HoA, and subject to execution of binding transaction documents and the necessary approvals and consents, OZ Minerals agrees to pay IMX A$5 million cash. In addition, upon the required approvals of IMX shareholders being obtained and completion of the transaction, IMX and OZ Minerals have agreed to cancel the 33.909 million IMX ordinary fully-paid shares held by OZ Minerals for nil cash consideration. Accordingly, during the quarter, the Company completed the placement of 33,909,000 ordinary fully-paid shares at A$0.11 per share (the "Share Placement"), raising a net amount of A$3.44 million after fees.
The issue of new shares to off-set the share cancellation means that the total funds expected to be derived from the sale, share cancellation and capital raising, will be approximately $8.7 million, with (assuming completion occurs and IMX shareholder approval is obtained) no overall increase in issued capital or dilution to existing shareholders. Until such time as IMX shareholder approval is obtained and completion occurs, there will however be an intervening period where the issued capital is above the 362 million shares on issue prior to the Share Placement.
Work on completion of the related transaction documents is continuing.
Annual General Meeting
The annual general meeting of IMX shareholders was held on 22 November 2012. A total of nine motions were put to shareholders, of which seven were carried: the re-election of John Nitschke and election of Kellie Benda and David Constable as directors; the removal and appointment of the Company's Auditor; the grant of stock options to the Managing Director; and adoption of the Remuneration Report. A motion for the approval of an additional 10% capital raising capacity was not carried and owing to the adoption of the Remuneration Report, a spill meeting resolution was also not carried.
As at 31 December 2012, the Group had cash at bank of A$12.8 million, the key components of the quarterly cash flow were:
-- Net cash inflow from 100% of Cairn Hill operations of A$4.7 million for the quarter.-- Proceeds of A$3.44 million from the placement of the 33.909 million ordinary fully-paid shares at A$0.11 completed during November 2012. The same number of shares is expected to be cancelled for nil consideration upon completion of the transaction with OZ Minerals.-- A number of once off costs were incurred in relation to the completion of the CNI acquisition.
Repayment of Cairn Hill JV Finance Facility
During the quarter, the Line of Credit with LinQ Resources Fund, previously secured by Termite Resources NL, was fully repaid. The Line of Credit was repaid out of continued positive cash flows from the Cairn Hill mining operation, however it remains in place until 30 May 2013, providing the Cairn Hill JV with undrawn headroom of $15 million.