BARYS RESOURCES LIMITED — Proxy Solicitation & Information Statement 2012

Jan 18, 2012

ANNOUNCEMENT

19 JANUARY 2012

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NOTICE OF GENERAL MEETING

Mining Group Limited advises that the attached Notice of General Meeting for a shareholders’ meeting scheduled for Friday, 17[th] February 2012 at 10.00am WST at 3 Richardson Street, West Perth and covering letter will today be dispatched to shareholders.

AUTHORISED BY:

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Shannon Coates Company Secretary

Contact:

Andrew Maurice Managing Director amaurice@mininggroup.net.au

P: + 61 8 9322 6424 M: 0410 642 660

Level 1, 173 Mounts Bay Road PERTH WA 6000

About Mining Group Limited

Mining Group Limited (ASX: MNE) is an ASX listed, Australian based exploration company established to explore, evaluate and acquire commercially significant resource projects in Australia and overseas.

Mining Group seeks to develop the Comval Copper Gold Project in the Philippines along with exploring the prospective Western Australian based Boorara, Teutonic and Lake Christopher Projects.

Mining Group has a strong Board and management team with considerable technical, commercial and corporate experience in the resources sector.

For more information visit the Mining Group website at www.mininggroup.net.au

173 MOUNTS BAY ROAD PERTH WESTERN AUSTRALIA 6000 TELEPHONE 08 9322 6424 FACSIMILE 08 9322 6778

www.mininggroup.net.au

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19 January 2012

Dear Shareholder

Please find attached a Notice of General Meeting for a shareholders’ meeting of Mining Group Ltd that will be held on Friday, 17[th] February 2012 at 10.00am WST at 3 Richardson Street, West Perth.

As you are aware, your company has been working hard toward completing the acquisition of its 80% interest in the Comval Copper Gold Project in the Philippines and settlement is anticipated prior to the holding of this general meeting.

We are very excited about the prospects associated with the project and have an aggressive exploration program planned, with a clear path to development. Our geologists are already on site in the Philippines re-logging and analysing some of the 24,000m of core from previous drilling and other data with a view to establishing a JORC compliant resource as soon as possible.

Once this resource has been established, we intend to commence a high level scoping study to incorporate the geological, metallurgical and engineering data as well as undertaking a financial analysis to assist with determining our development plans moving forward.

The purpose of the general meeting is to ratify the prior issues of shares and options, gain approval for the issue of the deferred consideration shares (to be issued if certain conditions are met), adopt the Employee Incentive Option Plan and to gain approval to raise further capital for the company. Full details of the business of the meeting are contained in the attached Notice of General Meeting, which we urge you to read in detail.

Whilst we have sufficient capital to meet the short to medium term objectives in relation to the project, we have foreshadowed approval in the notice of meeting for a capital raising by issuing up to 15,000,000 shares which may or may not be issued within the three month approval period. The purpose of the resolution is to allow the company the flexibility to raise funds should market conditions be favourable.

We look forward to keeping you apprised of further developments with regards to the Comval Copper Gold Project through announcements to the ASX and sincerely thank you for your support.

Yours sincerely

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Andrew Maurice Managing Director

173 MOUNTS BAY ROAD PERTH WESTERN AUSTRALIA 6000 TELEPHONE 08 9322 6424 FACSIMILE 08 9322 6778

www.mininggroup.net.au

MINING GROUP LIMITED ACN 149 230 811

NOTICE OF GENERAL MEETING

TIME : 10.00am WST DATE : 17 February 2012 PLACE : 3 Richardson Street WEST PERTH WA 6005

This Notice of Meeting should be read in its entirety. If Shareholders are in doubt as to how they should vote, they should seek advice from their professional advisers prior to voting.

Should you wish to discuss the matters in this Notice of Meeting please do not hesitate to contact the Company Secretary, Ms Shannon Coates, on +61 8 9322 6424.

CONTENTS

Business of the Meeting (setting out the proposed Resolutions)	3
Explanatory Statement (explaining the proposed Resolutions)	5
Glossary	13
Schedule 1 – Terms and Conditions of Options	15
Proxy Form	17
IMPORTANT INFORMATION

TIME AND PLACE OF MEETING

Notice is given that the General Meeting of the Shareholders to which this Notice of Meeting relates will be held at 10:00am WST on Friday, 17 February 2012 at:

3 Richardson Street West Perth, Western Australia

YOUR VOTE IS IMPORTANT

The business of the General Meeting affects your shareholding and your vote is important.

VOTING ELIGIBILITY

The Directors have determined pursuant to Regulation 7.11.37 of the Corporations Regulations 2001 (Cth) that the persons eligible to vote at the General Meeting are those who are registered Shareholders at 10:00am (WST) on Wednesday 15 February 2012.

VOTING IN PERSON

To vote in person, attend the General Meeting at the time, date and place set out above.

VOTING BY PROXY

To vote by proxy, please complete and sign the enclosed Proxy Form and return by the time and in accordance with the instructions set out on the Proxy Form.

In accordance with section 249L of the Corporations Act, members are advised that:

• each member has a right to appoint a proxy;

• the proxy need not be a member of the Company; and

• a member who is entitled to cast 2 or more votes may appoint 2 proxies and may specify the proportion or number of votes each proxy is appointed to exercise. If the member appoints 2 proxies and the appointment does not specify the proportion or number of the member’s votes, then in accordance with section 249X(3) of the Corporations Act, each proxy may exercise one-half of the votes.

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New sections 250BB and 250BC of the Corporations Act came into effect on 1 August 2011 and apply to voting by proxy on or after that date. Shareholders and their proxies should be aware of these changes to the Corporations Act, as they will apply to this General Meeting. Broadly, the changes mean that:

• if proxy holders vote, they must cast all directed proxies as directed; and

• any directed proxies which are not voted will automatically default to the Chair, who must vote the proxies as directed.

Further details on these changes are set out below.

Proxy vote if appointment specifies way to vote

Section 250BB(1) of the Corporations Act provides that an appointment of a proxy may specify the way the proxy is to vote on a particular resolution and, if it does :

• the proxy need not vote on a show of hands, but if the proxy does so, the proxy must vote that way (i.e. as directed); and

• if the proxy has 2 or more appointments that specify different ways to vote on the resolution – the proxy must not vote on a show of hands; and

• if the proxy is the chair of the meeting at which the resolution is voted on – the proxy must vote on a poll, and must vote that way (i.e. as directed); and

• if the proxy is not the chair – the proxy need not vote on the poll, but if the proxy does so, the proxy must vote that way (i.e. as directed).

Transfer of non-chair proxy to chair in certain circumstances

Section 250BC of the Corporations Act provides that, if:

• an appointment of a proxy specifies the way the proxy is to vote on a particular resolution at a meeting of the Company's members; and

• the appointed proxy is not the chair of the meeting; and

• at the meeting, a poll is duly demanded on the resolution; and

• either of the following applies:

• the proxy is not recorded as attending the meeting;

• the proxy does not vote on the resolution,

the chair of the meeting is taken, before voting on the resolution closes, to have been appointed as the proxy for the purposes of voting on the resolution at the meeting.

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BUSINESS OF THE MEETING

AGENDA

ORDINARY BUSINESS

1. RESOLUTION 1 – RATIFICATION OF PRIOR ISSUE – CONSIDERATION SHARES

To consider and, if thought fit, to pass, with or without amendment, the following resolution as an ordinary resolution :

“That, for the purpose of ASX Listing Rule 7.4 and for all other purposes, Shareholders ratify the allotment and issue of 2.6 million Shares on the terms and conditions set out in the Explanatory Statement.”

Voting Exclusion : The Company will disregard any votes cast on this Resolution by a person who participated in the issue and any associates of those persons. However, the Company need not disregard a vote if it is cast by a person as a proxy for a person who is entitled to vote, in accordance with the directions on the Proxy Form, or, it is cast by the person chairing the meeting as proxy for a person who is entitled to vote, in accordance with a direction on the Proxy Form to vote as the proxy decides.

2. RESOLUTION 2 – RATIFICATION OF PRIOR ISSUE AND GRANT – SHARES AND OPTIONS

To consider and, if thought fit, to pass, with or without amendment, the following resolution as an ordinary resolution :

“That, for the purpose of ASX Listing Rule 7.4 and for all other purposes, Shareholders ratify the issue of the following securities on the terms and conditions set out in the Explanatory Statement:

(a) 500,000 Shares; and

• (b) 2 million Options.”

Voting Exclusion : The Company will disregard any votes cast on this Resolution by a person who participated in the issue and any associates of those persons. However, the Company need not disregard a vote if it is cast by a person as a proxy for a person who is entitled to vote, in accordance with the directions on the Proxy Form, or, it is cast by the person chairing the meeting as proxy for a person who is entitled to vote, in accordance with a direction on the Proxy Form to vote as the proxy decides.

3. RESOLUTION 3 – ISSUE OF DEFERRED CONSIDERATION SHARES

To consider and, if thought fit, to pass, with or without amendment, the following resolution as an ordinary resolution :

“That, for the purpose of ASX Listing Rule 7.1 and for all other purposes, approval is given for the Directors to allot and issue 2.6 million Shares on the terms and conditions set out in the Explanatory Statement.”

Voting Exclusion : The Company will disregard any votes cast on this Resolution by any person who may participate in the proposed issue and a person who might obtain a benefit, except a benefit solely in the capacity of a holder of ordinary securities, if the Resolution is passed and any associates of those persons. However, the Company need not disregard a vote if it is cast by a person as a proxy for a person who is entitled to vote, in accordance with the directions on the Proxy Form, or, it is cast by the person chairing

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the meeting as proxy for a person who is entitled to vote, in accordance with a direction on the Proxy Form to vote as the proxy decides.

4. RESOLUTION 4 – CAPITAL RAISING

To consider and, if thought fit, to pass, with or without amendment, the following resolution as an ordinary resolution :

“That, for the purpose of ASX Listing Rule 7.1 and for all other purposes, approval is given for the Directors to allot and issue up to 15 million Shares on the terms and conditions set out in the Explanatory Statement.”

Voting Exclusion : The Company will disregard any votes cast on this Resolution by any person who may participate in the proposed issue and a person who might obtain a benefit, except a benefit solely in the capacity of a holder of ordinary securities, if the Resolution is passed and any associates of those persons. However, the Company need not disregard a vote if it is cast by a person as a proxy for a person who is entitled to vote, in accordance with the directions on the Proxy Form, or, it is cast by the person chairing the meeting as proxy for a person who is entitled to vote, in accordance with a direction on the Proxy Form to vote as the proxy decides.

5. RESOLUTION 5 – ADOPTION OF EMPLOYEE INCENTIVE OPTION PLAN

To consider and, if thought fit, to pass, with or without amendment, the following resolution as an ordinary resolution :

“That, for the purposes of ASX Listing Rule 7.2 (Exception 9(b)) and for all other purposes, approval is given for the Company to adopt the Employee Incentive Option Plan on the terms and conditions set out in the Explanatory Statement.”

Voting Exclusion Statement : The Company will disregard any votes cast on this Resolution by any Director, other than any Director who is ineligible to participate in the Employee Incentive Option Plan, and any associates of those Directors. However, the Company need not disregard a vote if it is cast by a person as a proxy for a person who is entitled to vote in accordance with the directions on the Proxy Form or it is cast by the person chairing the meeting as proxy for a person who is entitled to vote, in accordance with a direction on the Proxy Form to vote as the proxy decides.

Dated: 6 January 2012

By order of the Board

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Ms Shannon Coates Non-Executive Director and Company Secretary Mining Group Limited

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EXPLANATORY STATEMENT

This Explanatory Statement has been prepared to provide information which the Directors believe to be material to Shareholders in deciding whether or not to pass the Resolutions which are the subject of the business of the Meeting.

1. RESOLUTION 1 – RATIFICATION OF PRIOR ISSUE – CONSIDERATION SHARES

1.1 General

At the general meeting held on 22 December 2011, Shareholders agreed to the change of scale of activities which would result from the acquisition by MNE Holdings Pty Ltd (a wholly owned subsidiary of the Company) ( MNE Holdings ) of an 80% interest in Philco Mining Corporation ( Philco ) from Philco Holdings Inc. ( PHI ), a wholly owned subsidiary of Cadan Resources Corporation (TSX: V:CXD) ( Cadan ) ( Acquisition ). As part consideration for the Acquisition, the Company will issue 2.6 million Shares to Cadan ( Consideration Shares ) at settlement of the Acquisition (which is anticipated to occur prior to the General Meeting).

Resolution 1 seeks Shareholder ratification pursuant to ASX Listing Rule 7.4 for the issue of the Consideration Shares.

ASX Listing Rule 7.1 provides that a company must not, subject to specified exceptions, issue or agree to issue more equity securities during any 12 month period than that amount which represents 15% of the number of fully paid ordinary securities on issue at the commencement of that 12 month period.

ASX Listing Rule 7.4 sets out an exception to ASX Listing Rule 7.1. It provides that where a company in general meeting ratifies the previous issue of securities made pursuant to ASX Listing Rule 7.1 (and provided that the previous issue did not breach ASX Listing Rule 7.1), those securities will be deemed to have been made with shareholder approval for the purpose of ASX Listing Rule 7.1.

By ratifying the issue of the Consideration Shares, the Company will retain the flexibility to issue equity securities in the future up to the 15% annual placement capacity set out in ASX Listing Rule 7.1 without the requirement to obtain prior Shareholder approval.

1.2 Technical information required by ASX Listing Rule 7.4

Pursuant to and in accordance with ASX Listing Rule 7.5, the following information is provided in relation to the issue of the Consideration Shares:

• (a) 2.6 million Consideration Shares will be allotted and issued;

• (b) the deemed issue price per Share will be $0.20;

• (c) the Consideration Shares to be issued will all be fully paid ordinary shares in the capital of the Company and will be issued on the same terms and conditions as the Company’s existing Shares;

• (d) the Consideration Shares will be allotted and issued to Cadan, who is not a related party of the Company; and

• (e) no funds will be raised from the issue of the Consideration Shares as they will be issued in consideration for the Acquisition.

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2. RESOLUTION 2 – RATIFICATION OF PRIOR ISSUE AND GRANT – SHARES AND OPTIONS

2.1 General

On or about 23 December 2011 and in accordance with the requirements of the Share Sale Agreement entered into between the Company, Cadan, Philco, PHI and MNE Holdings on or about 23 December 2011, the Company entered into a Facilitation Deed with MNE Holdings and Cadan ( Facilitation Deed ). Pursuant to the Facilitation Deed, the Company will issue the following securities to Cadan at settlement of the Acquisition (as defined in Section 1.1 above):

• (a) 500,000 Shares at an issue price of $0.20 each; and

• (b) 2 million Options at a grant price of $0.01 per Option and exercisable at $0.20 each on or before 1 July 2014,

to raise $120,000 (collectively the Placement or Placement Securities , where relevant). Settlement is scheduled to occur on or about 17 January 2012 (i.e. before the date of the General Meeting) and the Placement Securities will be issued on the same date.

Resolution 2 seeks Shareholder ratification of the Placement pursuant to ASX Listing Rule 7.4.

A summary of ASX Listing Rules 7.1 and 7.4 is set out in Section 1.1 above.

By ratifying the Placement, the Company will retain the flexibility to issue equity securities in the future up to the 15% annual placement capacity set out in ASX Listing Rule 7.1 without the requirement to obtain prior Shareholder approval.

2.2 Technical information required by ASX Listing Rule 7.4

Pursuant to and in accordance with ASX Listing Rule 7.5, the following information is provided in relation to the Placement:

• (a) 500,000 Shares will be issued at $0.20 per Share;

• (b) 2 million Options will be granted at $0.01 per Option;

• (c) the Shares to be issued will all be fully paid ordinary shares in the capital of the Company and will be issued on the same terms and conditions as the Company’s existing Shares;

• (d) the Options are to be granted on the terms and conditions set out in Schedule 1;

• (e) the Placement Securities will be issued to Cadan, who is not a related party of the Company; and

• (f) the funds raised from the Placement will be applied towards:

• (i) the costs of the Acquisition;

• (ii) additional project evaluation; and

• (iii) general working capital.

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3. RESOLUTION 3 – ISSUE OF DEFERRED CONSIDERATION SHARES

3.1 General

As a further component of the consideration for the Acquisition described in Section 1.1 above, the Company will issue a further 2.6 million Shares to Cadan ( Deferred Consideration Shares ) at a deemed issue price of $0.20 per Share if the Company’s Shares are traded at or above $1 for 30 consecutive days at any time within 24 months of settlement of the Acquisition ( Milestone ).

Resolution 3 seeks Shareholder approval for the Company to allot and issue the Deferred Placement Shares.

A summary of ASX Listing Rule 7.1 is set out in Section 1.1 above.

The effect of Resolution 3 will be to allow the Directors to issue the Deferred Consideration Shares during the period of 3 months after the Meeting, without using the Company’s 15% annual placement capacity.

3.2 Technical information required by ASX Listing Rule 7.1

Pursuant to and in accordance with ASX Listing Rule 7.3, the following information is provided in relation to the Deferred Consideration Shares:

• (a) the maximum number of Deferred Consideration Shares to be issued upon the Milestone being reached is 2.6 million;

• (b) the Deferred Consideration Shares will be issued no later than 3 months after the date of the Meeting (or such later date to the extent permitted by any ASX waiver or modification of the ASX Listing Rules) and it is intended that allotment will occur on the same date;

• (c) the deemed issue price per Deferred Consideration Share will be $0.20;

• (d) the Deferred Consideration Shares to be issued will all be fully paid ordinary shares in the capital of the Company and will be issued on the same terms and conditions as the Company’s existing Shares;

• (e) the Deferred Consideration Shares will be allotted and issued to Cadan, who is not a related party of the Company; and

• (f) no funds will be raised from the issue of the Deferred Consideration Shares as the Deferred Consideration Shares will be issued as part consideration for the Acquisition.

4. RESOLUTION 4 – CAPITAL RAISING

4.1 General

Resolution 4 seeks Shareholder approval for the allotment and issue of up to 15 million Shares at an issue price not less than 90% of the average market price for Shares calculated over the 5 days on which sales in the Shares are recorded before the day on which the issue is made or, if there is a prospectus, over the last 5 days on which sales in the Shares are recorded before the date the prospectus is signed ( Capital Raising ).

The Company has engaged the services of Cygnet Capital Pty Ltd (ACN 103 488 606) ( Cygnet Capital ), a licensed securities dealer (AFSL 241095) to manage the

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Capital Raising. The Company will pay Cygnet Capital (exclusive of GST) a 5% capital raising fee and 1% management fee on the funds raised under the Capital Raising. The Directors, none of whom have a material personal interest in Cygnet Capital, consider the engagement to be on arm’s length terms as the fees charged are comparable to those charged by other licensed securities dealers.

None of the subscribers for Shares under the Capital Raising will be related parties of the Company for the purpose of Listing Rule 10.11.

A summary of ASX Listing Rule 7.1 is set out in Section 1.1 above.

The effect of Resolution 4 will be to allow the Directors to issue the Shares pursuant to the Capital Raising during the period of 3 months after the Meeting (or a longer period, if allowed by ASX), without using the Company’s 15% annual placement capacity.

4.2 Technical information required by ASX Listing Rule 7.1

Pursuant to and in accordance with ASX Listing Rule 7.3, the following information is provided in relation to the Capital Raising:

• (a) the maximum number of Shares to be issued is 15 million Shares;

• (b) the Shares will be issued no later than 3 months after the date of the Meeting (or such later date to the extent permitted by any ASX waiver or modification of the ASX Listing Rules) and it is intended that allotment will occur on the same date;

• (c) the issue price per Share will be not less than 90% of the average market price for Shares calculated over the 5 days on which sales in the Shares are recorded before the day on which the issue is made or, if there is a prospectus, over the last 5 days on which sales in the Shares are recorded before the date the prospectus is signed;

• (d) the Directors will determine to whom the Shares will be issued but these persons will not be related parties of the Company;

• (e) the Shares issued will be fully paid ordinary shares in the capital of the Company issued on the same terms and conditions as the Company’s existing Shares; and

• (f) the Company intends to use the funds raised from the Capital Raising towards:

• (i) the costs of the Capital Raising;

• (ii) additional project evaluation; and

• (iii) general working capital.

5. RESOLUTION 5 – APPROVAL OF EMPLOYEE INCENTIVE OPTION PLAN

5.1 General

To ensure that the Company has appropriate mechanisms to continue to attract, motivate and retain the services of Directors and employees of a high calibre, the Board has established the “Employee Incentive Option Plan” ( Plan ).

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5.2 Regulatory requirements

Resolution 5 seeks Shareholder approval under exception 9(b) of ASX Listing Rule 7.2 to allow the grant of options ( Incentive Options ) and the issue of Shares on the exercise of such Incentive Options under the Plan as an exception to ASX Listing Rule 7.1.

A summary of ASX Listing Rule 7.1 is set out in Section 1.1 above.

Exception 9(b) of ASX Listing Rule 7.2 provides that a company may make an issue of securities under an employee incentive scheme (such as the Plan) if, within three years before the date of issue, holders of ordinary securities in the company have approved the issue of securities under the scheme as an exception to ASX Listing Rule 7.1.

If Resolution 5 is passed, the Company will have the ability to grant Incentive Options to eligible participants under the Plan over a period of three years without impacting on the Company’s 15% placement capacity under ASX Listing Rule 7.1.

The Directors and employees of the Company have been, and will continue to be, instrumental in the growth of the Company. The Directors consider that the Plan is an appropriate method to:

• (a) reward executive Directors and employees for their past performance;

• (b) provide long term incentives for participation in the Company’s future growth;

• (c) motivate executive Directors and generate loyalty from senior employees; and

• (d) assist to retain the services of valuable Directors and employees.

The Plan will be used as part of the remuneration planning for executive Directors and employees. The ASX Corporate Governance Council Guidelines recommend that executive remuneration packages involve a balance between fixed and incentive pay reflecting short and long-term performance objectives appropriate to the company’s circumstances and goals.

Non-executive Directors are not eligible to participate in the Plan.

As at the date of this Notice of Meeting, no Incentive Options have been granted under the Plan.

The key terms of the Plan are summarised in Section 5.3 below. A full copy of the Plan is available for inspection at the Company’s registered office until the date of the Meeting.

5.3 Summary of the Plan

The Board has resolved to adopt an Employee Incentive Option Plan to allow Eligible Participants to be granted Incentive Options to acquire Shares in the Company. The material terms of the Plan are summarised below:

• (a) Eligible Participants

Means full or part time employees of the Company or an associated body corporate (including Directors other than non-executive Directors) ( Eligible Participants ).

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(b) Purpose of the Plan

The purpose of the Plan is to provide an incentive to encourage participation by Eligible Participants in the Company through Share ownership and to attract, motivate and retain Eligible Participants.

(c) Offer of Incentive Options

When an Eligible Participant satisfies specified criteria imposed by the Board (including performance criteria and any specified period(s) of tenure), the Board may grant Incentive Options to the Eligible Participant. The Board will determine the number of Incentive Options being offered and the conditions that must be met by the Eligible Participant before the Incentive Options may be exercised.

(d) Number of Incentive Options offered

The number of Incentive Options that will be offered to an Eligible Participant pursuant to an Offer is entirely within the discretion of the Directors.

(e) Exercise price

The exercise price of any Incentive Option granted to an Eligible Participant shall be at the absolute discretion of the Board, but may not be less than the minimum price specified in the Listing Rules.

(f) Lapsing of Incentive Options

Subject to the terms of the Offer made to a Participant, an unexercised Incentive Option will lapse:

• (i) on its expiry date;

• (ii) if any exercise condition is unable to be met; and

• (i) if the Eligible Participant ceases to be an employee or Director of a member of the Company or an Associated Body Corporate for any reason whatsoever (including without limitation resignation or termination for cause) and:

  • (A) any exercise conditions have not been met by the date the Eligible Participant ceases to be an employee or Director of the Company or an Associated Body Corporate ( Ceasing Date ); or

  • (B) where any Exercise Conditions have been met by the Ceasing Date or the Incentive Option is not subject to any Exercise Conditions, the Participant does not exercise the Incentive Option within a period of three (3) months after the Ceasing Date (or a further date as determined by the Board after the Ceasing Date);

• (g) Shares allotted upon exercise of Incentive Options

The Company will issue or transfer shares to the Eligible Participant as soon as practicable after the exercise of any Incentive Options. The

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shares allotted under the Plan will be of the same class and will rank equally with shares in the Company at the date of issue.

The Company will seek listing of the new shares on ASX within the time required by ASX Listing Rules.

(h)

Disposal of Incentive Options

An Incentive Option issued under the Plan is not transferable and will not be quoted on the ASX, unless the offer provides otherwise or without the consent of the Board.

(f) Trigger events

The Company may permit Incentive Options to be exercised in certain circumstances where there is a change in control of the Company (including by takeover) or entry into a scheme of arrangement.

(i) Capital reorganisation

If at any time the Company’s issued capital is reorganised, all rights of an Incentive Optionholder are to be changed in a manner consistent with the ASX Listing Rules at the time of the reorganisation.

(j) Bonus issues

In the event of a bonus issue of Shares being made pro-rata to Shareholders, (other than an issue in lieu of dividends), the number of Shares issued on exercise of each Option will include the number of bonus Shares that would have been issued if the Option had been exercised prior to the record date for the bonus issue. No adjustment will be made to the exercise price per Share of the Option.

(k) Participation in new issues

There are no participating rights or entitlements inherent in the Incentive Options and the Incentive Optionholders will not be entitled to participate in new issues of capital offered to Shareholders during the currency of the Incentive Options. In addition, Incentive Optionholders will not be entitled to vote or receive dividends as a result of their holding of Incentive Options. However, the Company will ensure that for the purposes of determining entitlements to any such issue, the record date will be at least 7 business days after the issue is announced (or such other date if required under the Listing Rules). This will give Incentive Optionholders the opportunity to exercise their Incentive Options prior to the date for determining entitlements to participate in any such issue.

(g) Limitations on offers

The Company must take reasonable steps to ensure that the number of Shares to be received on exercise of Incentive Options offered under an offer when aggregated with:

• (i) the number of Shares that would be issued if each outstanding offer for Shares, units of Shares or options to acquire Shares under the Plan or any other employee share scheme of the Company were to be exercised or accepted; and

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• (ii) the number of Shares issued during the previous 5 years from the exercise of Incentive Options issued under the Plan (or any other employee share plan of the Company extended only to Eligible Participants),

does not exceed 5% of the total number of Shares on issue at the time of an offer (but disregarding any offer of Shares or option to acquire Shares that can be disregarded in accordance with ASIC Class Order 03/184).

6. ENQUIRIES

Shareholders are requested to contact the Company Secretary, Ms Shannon Coates, on +61 8 9322 6424 if they have any queries in respect of the matters set out in these documents.

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GLOSSARY

$ means Australian dollars.

Acquisition means the acquisition described in Section 1.1 of the Explanatory Statement.

ASIC means the Australian Securities and Investments Commission.

Associate has the meaning given to that term in the Income Tax Assessment Act 1936 (Cth).

Associated Body Corporate means:

• (a) a related body corporate (as defined in the Corporations Act) of the Company;

• (b) a body corporate which has an entitlement to not less than 20% of the voting Shares of the Company; and

• (c) a body corporate in which the Company has an entitlement to not less than 20% of the voting shares.

ASX means ASX Limited (ACN 008 624 691) or the financial market operated by ASX Limited, as the context requires.

Board means the current board of directors of the Company.

Business Day means Monday to Friday inclusive, except New Year’s Day, Good Friday, Easter Monday, Christmas Day, Boxing Day, and any other day that ASX declares is not a business day.

Cadan means Cadan Resources Corporation (a company incorporated in Canada).

Capital Raising means the capital raising as proposed in Resolution 4.

Company means Mining Group Limited (ACN 149 230 811).

Consideration Share means a Share the subject of Resolution 1.

Corporations Act means the Corporations Act 2001 (Cth).

Deferred Consideration Share means a Share the subject of Resolution 3.

Directors means the current directors of the Company.

Eligible Participant means a full or part time employee of the Company or an Associated Body Corporate, including a Director, other than a non-executive Director.

Employee Incentive Option Plan or Plan means the employee incentive option plan summarised in Section 5.3 of the Explanatory Statement.

Explanatory Statement means the explanatory statement accompanying the Notice.

General Meeting or Meeting means the meeting convened by the Notice.

Incentive Option means an option to be granted in accordance with the terms of the Employee Incentive Option Plan.

Incentive Optionholder means a holder of an Incentive Option.

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Listing Rules means the Listing Rules of ASX.

Notice or Notice of Meeting or Notice of General Meeting means this notice of general meeting including the Explanatory Statement and the Proxy Form.

Offer means an offer made to an Eligible Participant to subscribe for one or more Options under the Plan.

Option means an option to acquire a Share with the terms and conditions set out in Schedule 1.

Optionholder means a holder of an Option.

Participant means an Eligible Participant to whom Options have been granted under the Plan, or where applicable, an Associate of the Eligible Participant to whom Options have been granted under the Plan.

PHI means Philco Holding Inc. (a company incorporated in British Columbia, Canada).

Philco means Philco Mining Corp. (a company incorporated in the Philippines).

Proxy Form means the proxy form accompanying the Notice.

Resolutions means the resolutions set out in the Notice of Meeting, or any one of them, as the context requires.

Share means a fully paid ordinary share in the capital of the Company.

Shareholder means a holder of a Share.

WST means Western Standard Time as observed in Perth, Western Australia.

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SCHEDULE 1 – TERMS AND CONDITIONS OF OPTIONS

The Options entitle the Optionholder to subscribe for Shares on the following terms and conditions:

(a) Exercise price

The exercise price of each Option is 20 cents ($0.20).

(b) Entitlement

Each Option shall entitle the Optionholder the right to subscribe (in cash) for one Share in the capital of the Company.

(c) Option period

The Options will expire at 5:00pm WST on 1 July 2014. Subject to clause (g), Options may be exercised at any time prior to the expiry date and Options not so exercised shall automatically expire on the expiry date.

(d) Ranking of Share allotted on exercise of Option

Each Share allotted as a result of the exercise of any Option will, subject to the Constitution of the Company, rank in all respects pari passu with the existing Shares in the capital of the Company on issue at the date of allotment.

(e) Voting

A registered owner of an Option ( Optionholder ) will not be entitled to attend or vote at any meeting of the members of the Company unless they are, in addition to being an Optionholder, a member of the Company.

(f) Transfer of an Option

Options are transferable at any time prior to the expiry date. This right is subject to any restrictions on the transfer of Options that may be imposed by the ASX.

(g) Method of exercise of an Option

• (i) The Company will provide to each Optionholder a notice that is to be completed when exercising the Options ( Notice of Exercise of Options ). Options may be exercised by the Optionholder by completing the Notice of Exercise of Options and forwarding the same to the Company Secretary to be received prior to the expiry date. The Notice of Exercise of Options must state the number of Options exercised and the consequent number of Shares to be allotted; which number of Options must be a multiple of 2,500 if only part of the Optionholder’s total Options are exercised, or if the total number of Options held by an Optionholder is less than 2,500, then the total of all Options held by that Optionholder must be exercised.

• (ii) The Notice of Exercise of Options by an Optionholder must be accompanied by payment in full for the relevant number of Shares being subscribed, being an amount of 20 cents ($0.20) per Share.

• (iii) Subject to paragraph (g)(i) above, the exercise of less than all of an Optionholder’s Options will not prevent the Optionholder from exercising

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the whole or any part of the balance of the Optionholder’s entitlement under the Optionholder’s remaining Options.

• (iv) Within 14 days from the date the Optionholder properly exercises Options held by the Optionholder, the Company shall issue and allot to the Optionholder that number of Shares so subscribed for by the Optionholder.

• (v) If the Company is listed on the ASX at the time of issue and allotment of Shares upon exercise of an Option, the Company will, within 3 business days from the date of issue and allotment of Shares, apply to the ASX for, and use its best endeavours to obtain, Official Quotation of all such Shares, in accordance with the Corporations Act and the Listing Rules.

• (vi) The Company will generally comply with the requirements of the Listing Rules in relation to the timetables imposed when quoted Options are due to expire. Where there shall be any inconsistency between the timetables outlined herein regarding the expiry of the Options and the timetable outlined in the Listing Rules, the timetable outlined in the Listing Rules shall apply.

• (h) ASX listing

The Company will apply for quotation of the Options on the ASX (ASX: MNEO).

(i) Reconstruction

In the event of a reconstruction (including consolidation, sub-division, reduction or return) of the issued capital of the Company, all rights of the Optionholder will be changed to the extent necessary to comply with the Listing Rules applying to the reconstruction of capital, at the time of the reconstruction.

• (j) Participation in new Share issues

There are no participating rights or entitlements inherent in the Options to participate in any new issues of capital which may be made or offered by the Company to its Shareholders from time to time prior to the expiry date unless and until the Options are exercised. The Company will ensure that during the exercise period, the record date for the purposes of determining entitlements to any new such issue, will be at least six (6) business days after such new issues are announced (or such other date if required under the Listing Rules) in order to afford the Optionholder an opportunity to exercise the Options held by the Optionholder.

• (k)

No change of Options' exercise price or number of underlying Shares

Subject to clause (i), there are no rights to change the exercise price of the Options or the number of underlying Shares.

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ABN 73 149 230 811

Lodge your vote:

 By Mail: Level 1 173 Mounts Bay Road Perth WA 6000

Alternatively you can fax your form to 08 9322 6778

For all enquiries call:

(within Australia) 1300 850 505 (outside Australia) +61 3 9415 4000

Proxy Form

 For your vote to be effective it must be received by 10:00am (WST) Wednesday 15 February 2012

How to Vote on Items of Business

All your securities will be voted in accordance with your directions.

Appointment of Proxy

Voting 100% of your holding: Direct your proxy how to vote by marking one of the boxes opposite each item of business. If you do not mark a box your proxy may vote as they choose. If you mark more than one box on an item your vote will be invalid on that item.

Voting a portion of your holding: Indicate a portion of your voting rights by inserting the percentage or number of securities you wish to vote in the For, Against or Abstain box or boxes. The sum of the votes cast must not exceed your voting entitlement or 100%.

Appointing a second proxy: You are entitled to appoint up to two proxies to attend the meeting and vote on a poll. If you appoint two proxies you must specify the percentage of votes or number of securities for each proxy, otherwise each proxy may exercise half of the votes. When appointing a second proxy write both names and the percentage of votes or number of securities for each in Step 1 overleaf.

A proxy need not be a securityholder of the Company.

Signing Instructions

Individual: Where the holding is in one name, the securityholder must sign.

Joint Holding: Where the holding is in more than one name, all of the securityholders should sign.

Power of Attorney: If you have not already lodged the Power of Attorney with the registry, please attach a certified photocopy of the Power of Attorney to this form when you return it.

Companies: Where the company has a Sole Director who is also the Sole Company Secretary, this form must be signed by that person. If the company (pursuant to section 204A of the Corporations Act 2001) does not have a Company Secretary, a Sole Director can also sign alone. Otherwise this form must be signed by a Director jointly with either another Director or a Company Secretary. Please sign in the appropriate place to indicate the office held. Delete titles as applicable.

Attending the Meeting

Bring this form to assist registration. If a representative of a corporate securityholder or proxy is to attend the meeting you will need to provide the appropriate “Certificate of Appointment of Corporate Representative” prior to admission. A form of the certificate may be obtained from Computershare or online at www.investorcentre.com under the information tab, "Downloadable Forms".

Comments & Questions: If you have any comments or questions for the company, please write them on a separate sheet of paper and return with this form.

 Turn over to complete the form

 www.investorcentre.com

View your securityholder information, 24 hours a day, 7 days a week:

Review your securityholding

Update your securityholding

Your secure access information is:

SRN/HIN:

 PLEASE NOTE: For security reasons it is important that you keep your SRN/HIN confidential.

916CR_0_Sample_Proxy/000001/000001/i

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Change of address. If incorrect, mark this box and make the correction in the space to the left. Securityholders sponsored by a broker (reference number commences with ’ X ’) should advise your broker of any changes. I ND

Proxy Form

Appoint a Proxy to Vote on Your Behalf

Please mark to indicate your directions

XX

I/We being a member/s of Mining Group Limited hereby appoint

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the Chairman of the Meeting

OR

 PLEASE NOTE: Leave this box blank if you have selected the Chairman of the Meeting. Do not insert your own name(s).

or failing the individual or body corporate named, or if no individual or body corporate is named, the Chairman of the Meeting, as my/our proxy to act generally at the meeting on my/our behalf and to vote in accordance with the following directions (or if no directions have been given, as the proxy sees fit) at the General Meeting of Mining Group Limited to be held at 3 Richardson Street, West Perth WA 6005 on Friday, 17 February 2012 at 10:00am (WST) and at any adjournment of that meeting.

Items of Business 

PLEASE NOTE: If you mark the Abstain box for an item, you are directing your proxy not to vote on your behalf on a show of hands or a poll and your votes will not be counted in computing the required majority.

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For Against Abstain
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			For	Again	st Abstain
Resolution	1	Ratification of Prior Issue - Consideration Shares
Resolution	2	Ratification of Prior Issue and Grant - Shares and Options
Resolution	3	Issue of Deferred Consideration Shares
Resolution	4	Capital Raising
Resolution	5	Adoption of Employee Incentive Option Plan

The Chairman of the Meeting intends to vote undirected proxies in favour of each item of business.

SIGN Signature of Securityholder(s) This section must be completed.

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Individual or Securityholder 1 Securityholder 2 Securityholder 3
Sole Director and Sole Company Secretary Director Director/Company Secretary
Contact
Contact Daytime
Name Telephone Date / /
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1 4 2 8 5 8 A

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