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BARYS RESOURCES LIMITED Proxy Solicitation & Information Statement 2013

Apr 10, 2013

64567_rns_2013-04-10_400c55f0-7cff-4dae-be05-49ba58d9f1d6.pdf

Proxy Solicitation & Information Statement

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MINING GROUP LIMITED ACN 149 230 811

NOTICE OF GENERAL MEETING

TIME : 10.00am DATE : 10 May 2013 PLACE : Suite 1, Ground Floor, 83 Havelock 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 4328.

CONTENTS

Business of the Meeting (setting out the proposed Resolutions) 3
Explanatory Statement (explaining the proposed Resolutions) 5
Glossary 9
Schedule 1 – Terms and Conditions of Options 10
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 on 10 May 2013 at:

Suite 1, Ground Floor, 83 Havelock 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 5.00pm (WST) (7:00pm Sydney time) on 8 May 2013.

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.

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

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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 OF SHARES TO CADAN RESOURCES CORPORATION

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 5,952,381 Shares to Cadan Resources Corporation 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 – ISSUE OF LISTED OPTIONS TO CYGNET CAPITAL PTY LTD

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 22,500,000 Listed Options to Cygnet Capital Pty Ltd (or its nominee) 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.

3. RESOLUTION 3 – ISSUE OF SHARES AND OPTIONS TO CYGNET CAPITAL PTY LTD

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 4,254,283 Shares and up to 2,127,142 Options to Cygnet Capital Pty Ltd (or its nominee) 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.

Dated: 27 MARCH 2013

By order of the Board Ms Shannon Coates 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 OF SHARES TO CADAN RESOURCES CORPORATION

1.1 General

In August 2012, Cadan Resources Corporation ( Cadan ), REG Mineral Processing Services Pty Ltd ( REG ) and Philco Mining Corporation settled a dispute in the Singapore International Arbitration Centre (“the arbitration dispute”). By a Facilitation Deed dated 23 December 2011, Mining Group became obligated to pay $1,000,000 to Cadan if and when Cadan settled the arbitration dispute on certain terms.

Mining Group and Cadan negotiated an alternate settlement pursuant to which Mining Group paid $500,000 in cash and agreed to pay a further $300,000 in Shares to Cadan (calculated by reference to the 5 day VWAP of the Shares preceding the date of issue, to be issued by no later than 16 March 2013). Pursuant to this agreement, 5,952,381 Shares were issued to Cadan on 14 March 2013 at a deemed issue price of $0.0504.

Resolution 1 seeks Shareholder ratification pursuant to ASX Listing Rule 7.4 for the issue of 5,952,381 Shares to Cadan.

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 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 7.5

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

  • (a) 5,952,381 Shares were allotted and issued;

  • (b) the Shares were issued for nil cash consideration, at a deemed issue price of $0.0504, pursuant to an agreement between the Company and Cadan;

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

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

  • (e) no funds were raised from the issue of the Shares.

2. RESOLUTION 2 – ISSUE OF OPTIONS TO CYGNET CAPITAL PTY LTD

2.1 General

As announced on 18 March 2013, the Company proposed to undertake a fully underwritten non-renounceable entitlement issue of approximately 70,904,712 new Shares ( New Shares ) on the basis of two New Shares for every three Shares held by Shareholders on the record date, at an issue price of $0.035 per New Share and a free attaching New Option ( New Options ) (with an exercise price of $0.06 and an expiry date of 30 June 2015) for every two New Shares issued ( Entitlement Issue ).

The Entitlement Issue will raise approximately $2.48 million before costs. The funds raised pursuant to the Entitlement Issue will be applied, with existing funds and after meeting the expenses of the Entitlement Issue, towards exploration and drilling programs at the Comval Copper-Gold Project, target generation and reconnaissance field work at the Teutonic Project, to assess other opportunities which may fit the Company’s strategy and for general working capital.

Cygnet Capital Pty Ltd has been appointed lead manager and underwriter to the Entitlement Issue. In consideration, Cygnet will be entitled to a 6% underwriting fee calculated on total funds raised via the Entitlement Issue, which, at Cygnet’s election, can be taken as cash or converted to Shares and free attaching Options on the same terms as those offered pursuant to the Entitlement Issue (approval for these Shares and Options is the subject of Resolution 3 below).

Further, on quotation of the securities that Cygnet will acquire pursuant to its underwriting obligations, Cygnet will be entitled to a success fee of 22,500,000 Options on the same terms as the New Options.

Resolution 2 seeks Shareholder approval to issue the abovementioned 22,500,000 Options pursuant to ASX Listing Rule 7.1.

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

The effect of Resolution 2 will be to allow the Directors to grant the Options pursuant to Resolution 2 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.

2.2 Technical information required by ASX Listing Rule 7.3

Pursuant to and in accordance with ASX Listing Rule 7.3, the following information is provided in relation to Resolution 2:

  • (a) the number of Options to be issued is 22,500,000;

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  • (b) the Options 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 proposed that the Options will be allotted on one date (on or about the date of completion of the Entitlement Issue);

  • (c) the Options will be issued for nil cash consideration as they will be issued in consideration for management and underwriting services in relation to the Entitlement Issue;

  • (d) the Options will be issued to Cygnet Capital Pty Ltd (or its nominee), none of whom are a related party of the Company;

  • (e) the Options will be issued on the terms and conditions set out in Schedule 1; and

  • (f) no funds will be raised from the issue as they are being issued in consideration for the provision of services.

3. RESOLUTION 3 – ISSUE OF SHARES AND OPTIONS TO CYGNET CAPITAL PTY LTD

3.1 General

As announced on 18 March 2013, the Company proposed an Entitlement Issue, the terms of which are set out in the explanatory wording for Resolution 2 above.

In consideration for its appointment as lead manager and underwriter to the Entitlement Issue, Cygnet will be entitled to a 6% underwriting fee calculated on total funds raised via the Entitlement Issue, which, at Cygnet’s election, can be taken as cash or converted to Shares and free attaching Options on the same terms as those offered pursuant to the Entitlement Issue, including a free attaching Option on the same terms as the New Options, exercisable at 6 cents on or before 30 June 2015, on the basis of one New Option for every two New Shares issued.

The total funds to be raised pursuant to the Entitlement Issue will be $2,481,665 therefore Cygnet will be entitled to a cash fee of approximately $148,900. If Cygnet elects to convert this fee to equity, it will be entitled to be issued up to 4,254,283 New Shares and up to 2,127,141 New Options.

Resolution 3 seeks Shareholder approval to issue the abovementioned Shares and Options pursuant to ASX Listing Rule 7.1.

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 grant the Shares and Options pursuant to Resolution 3 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.

3.2 Technical information required by ASX Listing Rule 7.3

Pursuant to and in accordance with ASX Listing Rule 7.3, the following information is provided in relation to Resolution 2:

  • (a) the maximum number of New Shares and New Options to be issued is up to 4,254,283 New Shares and up to 2,127,142 New Options;

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  • (b) the Shares and Options 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 proposed that the Shares and Options will be allotted on one date (on or about the date of completion of the Entitlement Issue);

  • (c) the Shares and Options will be issued for nil cash consideration as they will be issued in consideration for management and underwriting services in relation to the Entitlement Issue;

  • (d) the Shares and Options will be issued to Cygnet Capital Pty Ltd (or its nominee), none of whom are a related party of the Company;

  • (e) the Shares will be fully paid ordinary shares in the capital of the Company and issued on the same terms and conditions as the Company’s existing Shares and the Options will be issued on the terms and conditions set out in Schedule 1; and

  • (f) no funds will be raised from the issue as they are being issued in consideration for the provision of services.

4. ENQUIRIES

Shareholders are requested to contact the Company Secretary, Ms Shannon Coates, on +61 8 9322 4328 if they have any queries in respect of the matters set out in these documents.

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GLOSSARY

$ means Australian dollars.

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.

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

Corporations Act means the Corporations Act 2001 (Cth).

Directors means the current directors of the Company.

Explanatory Statement means the explanatory statement accompanying the Notice.

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

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.

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

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

(a) Exercise Price

The exercise price of each Option is 6 cents.

(a)

Entitlement

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

(b) Option Period

The Options will expire at 5.00pm WST on 30 June 2015. 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.

(c)

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.

(d) Voting

A registered owner of an Option ("Option Holder") 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 Option Holder, a member of the Company.

(e)

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 in circumstances where the Company is listed on the ASX.

(f)

Method of Exercise of an Option

  • (i) The Company will provide to each Option Holder a notice that is to be completed when exercising the Options ( Notice of Exercise of Options ). Options may be exercised by the Option Holder 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 ordinary Shares in the capital of the Company to be allotted; which number of Options must be a multiple of 2,500 if only part of the Option Holder’s total Options are exercised, or if the total number of Options held by an Option Holder is less than 2,500, then the total of all Options held by that Option Holder must be exercised.

  • (ii) The Notice of Exercise of Options by an Option Holder must be accompanied by payment in full for the relevant number of Shares being subscribed, being an amount of 6 cents ($0.06) per Share.

  • (iii) Subject to paragraph (g)(i) above, the exercise of less than all of an Option Holder’s Options will not prevent the Option Holder from exercising the whole or any part of the balance of the Option Holder’s entitlement under the Option Holder’s remaining Options.

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

  • (v) If the Company is listed on the ASX, the Company will within 3 business days from the date of issue and allotment of Shares pursuant to the exercise of an Option, 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 of the ASX.

  • (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.

(g) ASX Listing

The Company will apply for Quotation of the Options on the ASX.

  • (h)

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 Option Holder 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.

(i)

Participation in New Share Issues

There are no participating rights or entitlements inherent in the Options and the Option Holder will not be entitled 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 Option Holder an opportunity to exercise the Options held by the Option Holder.

(j) 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: Mining Group Limited Suite 1, Ground Floor 83 Havelock Street West Perth WA 6005

Alternatively you can fax your form to (within Australia) 08 9322 5230 (outside Australia) +61 8 9322 5230

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 8 May 2013

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. In addition, if a representative of a company is appointed pursuant to Section 250D of the Corporations Act to attend the Meeting, the documentation evidencing such appointment should be produced prior to admission to the Meeting. A form of a certificate evidencing the appointment may be obtained from the Company, or from Computershare 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.

Samples/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.

Proxy Form

Please mark to indicate your directions

Appoint a Proxy to Vote on Your Behalf

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 Suite 1, Ground Floor, 83 Havelock Street, West Perth, Western Australia on Friday, 10 May 2013 at 10:00am (WST) and at any adjournment of that meeting.

Items of BusinessPLEASE 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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  1. Ratification of prior issue of shares to Cadan Resources Corporation

  2. Issue of listed options to Cygnet Capital Pty Ltd

  3. Issue of shares and options to Cygnet Capital Pty Ltd

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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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