Update on Merger with Polymetals - Notice of Meeting

elieves that there are sufficient reasons for security holders to accept the offer in the absence of any
higher bid.
Having regard to the above, BDO has completed this comparison in two parts:
• A comparison between the value of an SXG share on a control basis prior to the Transaction and the
value of a share in the Merged Entity on a minority basis following the Transaction (fairness – see
Section 12 “Is the Transaction Fair”); and
• An investigation into other significant factors to which Shareholders might give consideration, prior to
approving the Transaction, after reference to the value derived above (reasonableness – see Section
13 “Is the Transaction Reasonable”).
This assignment is a Valuation Engagement as defined by Accounting Professional & Ethical Standards
Board professional standard APES 225 ‘Valuation Services’ (“APES 225”).
A Valuation Engagement is defined by APES 225 as follows:
“an Engagement or Assignment to perform a Valuation and provide a Valuation Report where the Valuer
is free to employ the Valuation Approaches, Valuation Methods, and Valuation Procedures that a
reasonable and informed third party would perform taking into consideration all the specific facts and
circumstances of the Engagement or Assignment available to the Valuer at that time.”
This Valuation Engagement has been undertaken in accordance with the requirements set out in APES 225.
4. Outline of the Transaction
Announcement
On 8 April 2013 Southern Cross Goldfields and Polymetals Mining Limited announced that they had entered
into an agreement to combine the two companies.
The Merger will be implemented as a ‘merger of equals’ through a scheme of arrangement under which
SXG will offer 11 SXG shares for every one PLY share on issue.
Following the Transaction SXG shareholders will hold approximately 47% of the shares in the Merged Entity
and PLY will hold approximately 53% of the shares in the Merged Entity.
The Merger will create a merged entity with a diversified Australian gold and base metals portfolio
including the Marda Project in Western Australia and the Mt Boppy Project in New South Wales.
Board and Management
The Board of the proposed Merged Entity will consist of six directors, of whom three will be current
directors of SXG and three will be current directors of PLY. The Chairperson will be Samantha Tough
(current Chairperson of SXG) and Glenn Jardine (current Managing Director of SXG) will be the Chief
Executive Officer.
Conditions Precedent
Implementation of the Scheme is dependent on a number of conditions, including:
• SXG Shareholders approving the Transaction;
• Polymetals obtaining Polymetals’ shareholder approval for:
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