Ann: Binding Heads of Agreement with Mungana Gold, page-6

re: Ann: Binding Heads of Agreement with Mung... KZL doesn't keep the cash, in fact if you read the announcement, there is no cash.

MUX gives KZL Promissory Note to the tune of $36.6m

In Exchange for this note KZL agrees to sell back most of its equity in MUX to MUX.

Under the agreement then, KZL agrees to cancel the promissory note on the condition that KZL gets back all its rights it gave up when it spun MUX out and MUX also cancels any liabilities owed to it by KZL.

There must be some deal in the pipeline to sell the northern assets to a 3rd party and this way the administrators can parcel together all the northern assets including the gold and partially finished processing plant.

The other possibility is that the northern assets may be what is left over for the shareholders of KZL. Given the deal with MUX wont be finalised until March, it is possible they want to sell everything else off and then relist as a brownfields development with the 'northern assets' and admiral bay still on the books.

If this deal goes through, MUX will no longer have any assets in QLD and just a bunch of cash, less shares and their projects in SA.

I take this announcement as positive as it means that there is at least some plan in the works.