Update on Merger with Polymetals - Notice of Meeting

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BDO CORPORATE FINANCE (WA) PTY LTD Polymetals Mining Limited and Southern Cross Goldfields Limited Technical Specialist's Report 5 QUALIFICATIONS AMC is a firm of mineral industry consultants whose activities include the preparation of due diligence reports on, and reviews of, mining and exploration projects for equity and debt funding and for public reports. In these assignments, AMC and its subconsultants have acted as independent parties. Although we do not consider it a conflict, AMC has had recent roles reviewing the Marda gold project feasibility study and has also reviewed certain mine geotechnical aspects for the Wingina Well project. Neither AMC nor its subconsultants have any business relationship with Grant Thornton, BDO, Polymetals or Southern Cross other than the carrying out of individual consulting assignments as engaged. While some employees of AMC and its subconsultants may have small direct or beneficial shareholdings in Polymetals or Southern Cross, neither AMC nor the contributors to this report nor members of their immediate families have any interests in Polymetals or Southern Cross that could be reasonably construed to affect their independence. AMC has no pecuniary interest, association or employment relationship with Grant Thornton, BDO, Polymetals or Southern Cross. AMC is being paid a fee by Southern Cross according to its normal per diem rates and out-of-pocket expenses in the preparation of this report. AMC's fee is not contingent upon the outcome of the Transaction or Scheme. The approximate fee paid to AMC for this work is $16,000. In correspondence relating to our engagement, Southern Cross agreed to comply with those obligations of the commissioning entity under the VALMIN Code including that to the best of its knowledge and understanding, complete, accurate and true disclosure of all relevant material information will be made. Polymetals and Southern Cross have separately represented in writing that to the best of their knowledge, they have provided AMC with all material information relevant to their operations and projects described in this report. In preparing this report, AMC has relied on information provided by Polymetals and Southern Cross, and AMC has no reason to believe that information is materially misleading or incomplete or contains any material errors. Polymetals and Southern Cross have been provided with drafts of our report to enable correction of any factual errors and notation of any material omissions. The views, statements, opinions and conclusions expressed by AMC are based on the assumption that all data provided to it by Polymetals and Southern Cross are complete, factual and correct to the best of their knowledge. This report and the conclusions in it are effective at 7 June 2013. Those conclusions may change in the future with changes in relevant metal prices, exploration and other technical developments in regard to the projects and the market for mineral properties. Southern Cross has provided AMC with indemnities in regard to damages, losses and liabilities related to or arising out of its engagement other than those arising from illegal acts, bad faith or negligence on its part or its reliance on unauthorised statements from third parties. This report has been provided to BDO for the purposes of forming its opinion in relation to the Transaction. AMC has given its consent for its report to be appended to BDO's report and for it to be provided to shareholders and has not withdrawn that consent before their lodgement with the Australian Securities & Investments Commission. Neither this report nor any part of it may be used for any other purpose without written consent. The signatories to this report are corporate members of the AusIMM and bound by its Code of Ethics. D Varcoe MAusIMM Principal Mining Engineer L Gillett FAusIMM (CP) Director 48
BDO CORPORATE FINANCE (WA) PTY LTD Polymetals Mining Limited and Southern Cross Goldfields Limited Technical Specialist's Report APPENDIX A PRINCIPAL SOURCES OF INFORMATION In preparing this report, AMC has relied on information provided by Polymetals and Southern Cross. GENERAL SXG Executed Scheme Implementation Agreement 20130407.pdf. POLYMETALS MINING LIMITED Environment, Permitting and Hydrology Environmental Impact Statement (and Appendices): Mt Boppy Gold Mine – Proposed Redevelopment Project. Polymetals (Mt Boppy) Pty Ltd. November 2011. Annual Environmental Management Report: Mt Boppy Gold Mine Canbelego NSW. Polymetals (Mt Boppy) Pty Ltd. February 2013. Life of Mine Tailings Management Strategy: Mt Boppy Gold Project. Polymetals (Mt Boppy) Pty Ltd. November 2011. Allan Watson Associates. October 2012. Mt Boppy Gold Mine – Proposed Redevelopment Project. Mining Operations Plan Version 3. Polymetals (Mt Boppy) Pty Ltd. October 2012 Mine Waste Management Plan (MWMP) for the Mt Boppy Gold Mine, Canbelego, NSW. Report No. 611013-MWMPv2. Environmental Earth Sciences Qld. October 2011. Mining Lease Conditions, Mining Lease No. 1681. NSW Government, Department of Trade and Investment – Resources and Energy Division. January 2013. Mt Boppy Gold Mine Development Project: Overview. Polymetals Mining Limited. June 2012. NAF and PAF Waste Field Testing. Polymetals Mining Limited. Safe Work Procedure. (Undated.) Turner River – Presentation to DMP. (Undated.) Geology, Resources and Exploration Property Valuations Polymetals Mining Limited, 2012: Mt Boppy Resource <strong>Update</strong> Report – January 2012. Polymetals Mining Limited, 2012: Boppy Sth Resource Summary Report – September 2012. Polymetals Mining Limited, 2012: Exploration Licence 5842 Canbelego Including Exploration Conducted Within Ml311, GL3255, GL5836, GL5848, GL5898 & MPL240. 11th Annual Exploration Report For The Reporting Period 20th April 2011 To 19th April 2012. Landsdowne Resources Pty Ltd, 2012: Information Memorandum Turner River Gold, Silver & Base Metal Projects, Pilbara WA. Ravensgate Consultants, 2012: Block Model Resource Estimation on the Discovery Zn, Ag & Pb Base Metals Project for Lansdowne Resources Pty Ltd. Ravensgate Consultants, 2012: Block Model Resource Estimation on the Orchard Tank Zn, Ag & Pb Base Metals Project for Lansdowne Resources Pty Ltd. Poly13-005.Tenement Summary. Polymetals ASX Announcement 13 March 2013. LDR TURNER RIVER_ INFORMATION MEMORANDUM (21 April 2012). 2013 02 ResEst Report Wingina Well. Block Model resource Estimation Report for Amanda Gold Project by Ravensgate. Block Model resource Estimation Report for Mt Berghaus Gold Project by Ravensgate. Appendix A -1
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ASX ANNOUNCEMENT / MEDIA RELEASE Fr
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ABN 71 124 374 321 U16,162 Colin St
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3. Access to the cash reserves of P
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Disclaimer and Important Notice •
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SXG - Well Placed • • •
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SXG and PLY - Key Merger Metrics
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Indicative Merger Timetable •
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A Diversified Portfolio of Australi
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Marda Project • Rare greenfields
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Northern Gold Corridor Targets - Dr
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WA Gold Assets - Turner River • P
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Mt Boppy - A Near-Term Production O
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ASX Code: Investor Presentation J
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Pro Forma Gold Reserve Statement Pr
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ABN 71 124 374 321 U16,162 Colin St
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- 3 - Notice of General Meeting Not
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- 5 - Proxy appointment, voting and
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- 7 - 1.2 Rationale for the Merger
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- 9 - 1.5 Implementation of the Mer
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- 11 - in terms of assets and marke
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- 13 - (a) You may not agree with t
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- 15 - (b) the Technical Specialist
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- 17 - (a) Identity of the person r
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- 19 - (i) Other matters The Direct
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- 21 - The purpose of Resolution 2
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- 23 - Schedule 1 - Information abo
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- 25 - Woodside Energy Ltd and Dire
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- 27 - Stephen Jones (Chief Financi
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- 29 - In accordance with ASIC Clas
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- 31 - million SXG Options which ha
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- 33 - Schedule 2 - Terms & Conditi
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- 35 - the Company out of profits o
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- 37 - Glossary In this Explanatory
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- 39 - Peak Litigation The litigati
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- 41 - Annexure A Refer enclosed In
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Financial Services Guide 21 June 20
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TABLE OF CONTENTS 1. Introduction 1
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2. Summary and Opinion 2.1 Purpose
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The respective advantages and disad
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elieves that there are sufficient r
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Existing SXG PLY Capital structure
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Sandstone Exploration Potential In
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5.3 Historical Balance Sheet Southe
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in tenement acquisition costs also
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The current SXG unlisted options on
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Drew Hill - White Dam Gold Project
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6.4 Historical Statement of Compreh
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At 31 March 2013, PLY have recorded
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Gold Demand/Supply Mined Metric ton
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• On 9 August 2012, Regis Resourc
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eport to be used in our report. At
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eport to be used in our report. At
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Funding assumptions SXG has receive
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AMC modelled two cases for the Mard
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Marda Project Case 2 Units 31-Dec-1
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uildings and water supply. The $38.
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Considering the valuation outcomes
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Southern Cross Goldfields Limited V
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We calculated the corporate costs o
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SXG share price and trading volume
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On 28 February 2013 SXG announced t
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Control Premium The concept of a pr
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We note that SXG’s EV/resource mu
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The Adjusted Mt Boppy Model was pre
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2013 2014 2015 2016 2017 2018 Gold
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AMC and management of PLY advise th
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Mt Boppy Case 2 Mt Boppy Project Ca
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Mt Boppy Case 2 Sensitivity analysi
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Polymetals Mining Limited Value of
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projects. PLY has discounted the to
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The Merged Entity - SXG Low Preferr
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Note f: Minority discount Following
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12. Is the Transaction fair In asse
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As set out in section 12, the Trans
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15. Sources of information This rep
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esponsible for conducting appropria
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Meadowhead Meadowhead Indemnity The
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APPENDIX 2 - VALUATION METHODOLOGIE
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APPENDIX 3 - DISCOUNT RATES SXG We
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Having regard to the above we consi
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Merged Entity Determining the corre
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associated (relative to the compara
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APPENDIX 4 - TECHNICAL SPECIALIST V
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AMC Consultants Pty Ltd ABN 58 008
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BDO CORPORATE FINANCE (WA) PTY LTD
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Update on Merger with Polymetals - Notice of Meeting

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