【正文】 ynthesize Silver Production III. Investment Strategies ? There are very few pure Silver producers available anywhere to invest in. The Silver supplydemand imbalance suggests significant outperformance of Gold as an investment. Silver is generally a biproduct of lead zinc and copper mines. Supply is inelastic until pure silver mines from Mexico, Peru and Argentina bee viable at much higher prices. ? Use of simple derivative contracts (with superior rated global banking institutions) allows AgAu Capital to convert Gold production to Silver production. Buy silver / Sell Gold contracts effectively converts 1 ounce of Gold production to 80 ounces of silver production. We expect the silver / gold ratio to fall from 80 to 1 at present to around 161 in the next 5 years. Gold/Silver Ratio III. Investment Strategies Gold/Silv e r Rati o 199 52 0080 . 0 01 0 . 0 02 0 . 0 03 0 . 0 04 0 . 0 05 0 . 0 06 0 . 0 07 0 . 0 08 0 . 0 09 0 . 0 0Feb95Feb96Feb97Feb98Feb99Feb00Feb01Feb02Feb03Feb04Feb05Feb06Feb07Feb08G ol d/ S i l v e r R a t i o? We expect significant outperformance by silver in ing years. ? Historic Bimetallic moary standard set at 16 to 1. ? Geologically the ratio is 14 to 1 but currently trading at 801 ? Industrial and Moary applications ensure demand Diversify Globally III. Investment Strategies ? Australian Investors have very few options when looking at attractive Precious Metal investments in the local market. We see significantly better value outside Australia at present. ? International Investors must be cognizant of Sovereign Risk when looking at Precious Metals as an asset class. Diversification is essential for risk management. Nationalisation of Mines – Crystallex Inc in Venezuela Exchange Controls – Zimplats in Zimbabwe. ? AgAu Capital monitors sovereign risk and adjusts portfolio balance accordingly. Preference for panies incorporated in Commonwealth countries with operations in mature economies. Manage exposure to African and South American production depending on country risk. Global Production III. Investment Strategies Global Gold Production has changed dramatically over the past 3 decades. ? A Precious Metals portfolio cannot ignore developing economies and countries of lesser sovereign risk Experienced Licensed Team IV. Team Relevant Experience (years) Previous Firms Experience Highlights Investment Professionals Laurie McGuirk 22 Citigroup Transmedia Group Head of Energy Derivatives Asia Pacific. Three times voted No 1 Corporate Risk Manager for Strategic Advice by Australia’s top 500 panies. Analysis, structuring and implementation of significant Precious Metals hedge books for major Gold Mining Companies and Central Banks. Construct and manage the groups Investment portfolio particularly PM’s and Equity portfolio. Mark Long 20 Merrill Lynch Citigroup Managing Director and Head of Commodities for Asia Pacific. Responsible for trading, structuring, sales and risk management of all modities in Asia. Head of Commodities – Asia Pacific Kyle Shortland 14 Suncorp Metway / Westpac / Next Financial Various roles including Senior Portfolio Manager, Prop trader, and Model Development as well as writing financial market mentaries for a number of global sources. Illustrative Investment Terms VI. Fund Terms Citco Fund Services (Australia) Limited Fund Administrator DLA Philips Fox Fund Lawyers Australia Walkers Fund Lawyers Caymans Investment Strategy Earn an attractive riskadjusted return by creating a globally diversified portfolio of gold mining stocks. Absolute Return Strategy employing both Fundamental and Technical analysis with a Long Delta position at all times. Specific sector concentration with mensurate risk diversification. Appropriate strategic futures and derivatives trading to enhance return and ameliorate risk. Target Size US$ 1 billion (Soft close at $600 million with excess capacity allocated to initial investors). Base Currency US$ Fund Structure MasterFeeder Cayman Islands Domiciled Investment Period 310 years Management Fee 2% of mitted capital paid monthly. Performance Fee 20% of profits paid quarterly with a high water mark. Preferred Return 15% Expenses The Manager will be reimbursed for all financing costs and all direct and indirect operating costs and expenses and all outofpocket costs and expenses incurred in connection with the operation of the assets and the provision of administrative services Diversification Requirements Company Exposure: Not more than 10% FUM exposed to any one pany, Not more than 5% of a single pany. Not more than five day