Update on Merger with Polymetals - Notice of Meeting

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Gold Demand/Supply Mined Metric tonnes 5000 4000 3000 2000 1000 0 Gold Supply and Demand 170% 165% 160% 155% 150% 145% 140% 135% Demand as % Supply Gold Mine Supply Gold Demand Demand as % Supply Source: Bloomberg and BDO Analysis Until the late 1980’s, South Africa produced approximately half of the total gold produced. More recently however, gold production has become geographically segmented, as shown in the chart below, with production dominated by China, Australia and the United States. Production by Country - 2012 16% China Australia 34% 10% United States Russia South Africa 4% 4% 7% 8% 7% 10% Peru Mexico Canada Others Source: Bloomberg and BDO Analysis Gold prices The price of gold fluctuates on a daily basis depending on global demand and supply factors. The price trend over the last two years is reflective of weak global economic conditions driving demand. As can be seen in the graph below, the value of gold peaked at US$1,900 per ounce on 5 September 2011. This peak was largely caused by the recent debt market crisis in Europe, but it was also driven by the Standard and Poor’s downgrade of the US credit rating. This sent global stock markets tumbling and a flood of investors towards safer havens such as gold. Prices contracted in December 2011 reaching a low of US$1,545 per 24
ounce; however 2012 a recovery of the gold price with it reaching US$1,790 per ounce on 4 October 2012, before declining to US$1,675 per ounce at 31 December 2012. Gold price have declined in 2013 which has seen the price fall below US$1,400 per ounce in April 2013. Gold prices are forecast to fall over the next three years to below US$1,500 per ounce in 2016. Nevertheless, growth in global money supply, U.S dollar depreciation and overall uncertainty in global financial markets may continue to drive investors toward using precious metals as a store of value. This could be further fuelled by the rapidly increasing appetite for precious metals from China. 2,000 Gold Pricing 1,800 1,600 1,400 US$/Ounce 1,200 1,000 800 600 400 200 - 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 Gold spot price Forecast Forward Source: Bloomberg and BDO Analysis Recent gold transactions The emergence of a new generation of mid-tier miners and the resurgent gold price in 2012 drove the increase in the number of announced gold acquisitions in 2012. In the last half of 2012, several large deals have been announced to the market involving gold companies: • On 29 June 2012 it was announced that Allied Gold Mining Plc and St Barbara Ltd had reached an agreement in which the two companies would merge, worth $594 million. This deal was completed on 7 September 2012. • In August 2012, Zijin Mining Group announced that it had made a cash offer to acquire its remaining 83.02% share in Norton Gold Fields Ltd for $198 million. This deal was completed on 21 August 2012. • On 6 August 2012, Silver Lake Resources announced it planned to merge with Integra Mining Ltd in a deal worth $417 million. The merger between Integra and Silver Lake was completed on 11 January 2013. 25
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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
Page 48 and 49: - 19 - (i) Other matters The Direct
Page 50 and 51: - 21 - The purpose of Resolution 2
Page 52 and 53: - 23 - Schedule 1 - Information abo
Page 54 and 55: - 25 - Woodside Energy Ltd and Dire
Page 56 and 57: - 27 - Stephen Jones (Chief Financi
Page 58 and 59: - 29 - In accordance with ASIC Clas
Page 60 and 61: - 31 - million SXG Options which ha
Page 62 and 63: - 33 - Schedule 2 - Terms & Conditi
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Page 66 and 67: - 37 - Glossary In this Explanatory
Page 68 and 69: - 39 - Peak Litigation The litigati
Page 70 and 71: - 41 - Annexure A Refer enclosed In
Page 72 and 73: Financial Services Guide 21 June 20
Page 74 and 75: TABLE OF CONTENTS 1. Introduction 1
Page 76 and 77: 2. Summary and Opinion 2.1 Purpose
Page 78 and 79: The respective advantages and disad
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Page 82 and 83: Existing SXG PLY Capital structure
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Page 86 and 87: 5.3 Historical Balance Sheet Southe
Page 88 and 89: in tenement acquisition costs also
Page 90 and 91: The current SXG unlisted options on
Page 92 and 93: Drew Hill - White Dam Gold Project
Page 94 and 95: 6.4 Historical Statement of Compreh
Page 96 and 97: At 31 March 2013, PLY have recorded
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Page 102 and 103: eport to be used in our report. At
Page 104 and 105: eport to be used in our report. At
Page 106 and 107: Funding assumptions SXG has receive
Page 108 and 109: AMC modelled two cases for the Mard
Page 110 and 111: Marda Project Case 2 Units 31-Dec-1
Page 112 and 113: uildings and water supply. The $38.
Page 114 and 115: Considering the valuation outcomes
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Page 118 and 119: We calculated the corporate costs o
Page 120 and 121: SXG share price and trading volume
Page 122 and 123: On 28 February 2013 SXG announced t
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Page 126 and 127: We note that SXG’s EV/resource mu
Page 128 and 129: The Adjusted Mt Boppy Model was pre
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Page 132 and 133: AMC and management of PLY advise th
Page 134 and 135: Mt Boppy Case 2 Mt Boppy Project Ca
Page 136 and 137: Mt Boppy Case 2 Sensitivity analysi
Page 138 and 139: Polymetals Mining Limited Value of
Page 140 and 141: projects. PLY has discounted the to
Page 142 and 143: The Merged Entity - SXG Low Preferr
Page 144 and 145: Note f: Minority discount Following
Page 146 and 147: 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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