Update on Merger with Polymetals - Notice of Meeting

BDO CORPORATE FINANCE (WA) PTY LTD
Polymetals Mining Limited and Southern Cross Goldfields Limited
Technical Specialist's Report
19 June 2013
The Directors
BDO Corporate Finance (WA) Pty Ltd
38 Station Street
SUBIACO WA 6008
Dear Sirs
POLYMETALS AND SOUTHERN CROSS GOLDFIELDS
TECHNICAL SPECIALIST'S REPORT
On 8 April 2013, Polymetals Mining Limited (Polymetals) and Southern Cross Goldfields Limited (Southern
Cross) announced, inter alia, that subject to certain conditions:
• Polymetals and Southern Cross have entered into an agreement to combine the two companies
under a merger structured as a Polymetals Scheme of Arrangement (Scheme).
• The merger will be implemented as a "merger of equals" by way of the Scheme under which
Polymetals shareholders will be offered Southern Cross shares.
As advised by Southern Cross, as a result of the Scheme, Southern Cross shares will be issued to
Polymetals' largest shareholder which will result in the shareholder and its associates holding more than
20% of the issued capital in the Merged Entity (Transaction).
The directors of Southern Cross have engaged BDO Corporate Finance (WA) Pty Ltd (BDO) to prepare an
Independent Expert Report (IER) in relation to the Transaction. The IER is to be included with a Notice of
Meeting to be sent to Southern Cross shareholders.
The directors of Southern Cross have also engaged AMC Consultants Pty Ltd (AMC) to provide BDO with a
Technical Specialist's Report (TSR) on the mineral assets of Polymetals and Southern Cross (Assets). The
TSR will be appended to the IER.
In relation to the TSR, BDO has instructed AMC to undertake a technical review and prepare a technical
valuation of the exploration assets and where appropriate to develop production cases for the mineral assets
of Polymetals and Southern Cross.
The scope of the TSR as advised by BDO to AMC includes:
• A description of the mineral assets.
• Examination of geology, Mineral Resources and Ore Reserves, development plans, mining aspects,
processing methods, production schedules, capital costs and operating costs, and exploration
potential for each operation or development project.
• Valuation of the exploration properties to the extent they are not covered by the life-of-mine production
cases for the operations and development projects.
Separately and prior to receiving instruction from BDO, Polymetals has engaged Grant Thornton Corporate
Finance Pty Ltd (Grant Thornton) to prepare an Independent Expert Report in relation to the proposed
merger. AMC was engaged on 18 April 2013 by Polymetals to provide an independent technical specialist's
report under instruction from Grant Thornton on the mineral assets of Polymetals and Southern Cross. BDO
has confirmed that it is satisfied with the instruction provided by Grant Thornton to AMC in relation to the
TSR, and that this instruction satisfies BDO’s requirements in its role as Expert. The technical content of this
TSR is essentially the same as the report provided to Grant Thornton. This TSR has been prepared
specifically for the Transaction.
For each of the operations and development projects reviewed, AMC has provided production cases
including capital and operating cost projections, with pre-tax revenues to BDO to allow BDO to calculate net
present values for the respective projects. AMC believes the production cases are based on reasonable
grounds.
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