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PROJECT FINANCE WITH PUREPLAY® NOTES

A PurePlay Note is the instrument used to embody a sale of unmined minerals held in Reserves by a miner.

We’ll use gold as a proxy for minerals for the sake of simplicity but a PurePlay Note will be possible for virtually any minerals including oil and gas.

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PRUDENTIAL GUIDELINES

Inevitably, with a new and innovative product, the market takes some time to mature and reach a stage where issuers are comfortable with the level of PurePlays that they can handle without strain on their production resources, and Investors are comfortable with assessing the risk and reward balance of a particular issue.

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PurePlay® Case Study

Diversified Mining Corporation (“DMC”)

A Practical Case Study using PurePlay® Instruments to convert a highly indebted mining corporation into a secure debt free entity.

DMC has $4bn in debt and is paying an average interest rate of 5.75% on that debt.

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Articles

Inevitably, with a new and innovative product, the market takes some time to mature and reach a stage where issuers are comfortable with the level of PurePlays that they can handle without strain on their production resources, and Investors are comfortable with assessing the risk and reward balance of a particular issue.

As developers of the PurePlay product we therefore thought that it would be helpful for us to set out what we believe to be conservative prudential guidelines for the early issues. These guidelines are not prescriptive, and in time the market will find its own comfort level, which will then become the norm in place of these guidelines.

1.1    What is a PurePlay Note?

A PurePlay Note is the instrument used to embody a sale of unmined minerals held in Reserves by a miner. We’ll use gold as a proxy for minerals for the sake of simplicity but a PurePlay Note will be possible for virtually any minerals including oil and gas. The terms of the sale will include (i) a delivery date and place, usually a number of years after the sale (maturity date); (ii) an undertaking by the miner to store the gold, without charge, in Reserves for the duration of the PurePlay Note (cost free storage); and an undertaking by the miner to extract, refine and deliver the gold at the miner’s cost at the specified gold delivery standard (say “London Good Delivery”) on the maturity date (extraction, refinement and delivery costs to remain with the miner).

1.    Introduction

The PurePlay® Instrument is a patented method, invented by South Africans. It allows Miners to sell, at spot value, minerals which have not yet been mined but have been identified, in terms of international standards, as their Proved and Probable Reserves. The Miner issues to an Investor a Pureplay Instrument which is a tradable Bill of Sale for a specified quantity of, say, gold. The Investor has to pay the full purchase price in cash at the front end when the Miner issues the PurePlay, and the Miner must deliver the gold after a stipulated period (mostly 10 years), and at a designated off-shore location.

Understanding PurePlay® Instruments

By Sarel Oberholster and Peter Dawe

Understanding the fundamental concepts in PurePlay® Instruments is a prerequisite for unlocking and maximising the value proposition of PurePlay® Instruments. Human beings, when confronted by something new or unfamiliar, automatically deploy their general knowledge to interpret, analyse and categorise the unknown.

Tactical Deployment of PurePlay® Programs for Producers

By Sarel Oberholster and Peter Dawe

In Tactical PurePlay® - Part One “Understanding PurePlay® Instruments” we have provided a frame of reference to comprehend the fundamental principles of PurePlay® Instruments. We have shown how PurePlay® Instruments are the key to unlocking Nature’s Vault™. Having access to the inside logic and deploying the full flexibility of PurePlay® Instruments will empower the Issuers of PurePlay® Instruments to design their PurePlay® Programs with targeted precision.

By Sarel Oberholster BCom cum laude, CAIB(SA) and Peter Dawe LLB (Hons) (London)

Everybody who has ever borrowed money knows about compound interest. It never sleeps. It does not take a day off to rest or take a vacation to recharge its batteries.

By Peter Dawe LLB (Hons) (London)

“A rose is a rose is a rose” is a famous saying by 19th century poet Gertrude Stein.  Of course no one really understands what it means! 

However the phrase comes into its own again when it is applied to PurePlay® Instruments.

Patents and Trade Marks

The Intellectual Property of PurePlay Holdings (Pty) Ltd is protected by world-wide pending Patents.

Trademarks awaiting registration are PurePlay™, Nature’s Vault™, As Good as Gold™ and Sp☼t True Value™.

Contact Details

5 Jan Smuts Avenue,Winston Park
Durban, 3610,South Africa


Tel: +27 31 7670156
Cell: +27 82 4515864
E-mail: p.dawe@pureplayholdings.com