CAZALY RESOURCES LIMITED — Capital/Financing Update 2011

Nov 28, 2011

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ASX ANNOUNCEMENT

29 November 2011

Placement to PXSteel International (Asia) Corporation Limited Unsolicited Takeover Bid from Dempsey Minerals Limited

Placement to PXSteel International (Asia) Corporation Limited

The Board of Winmar Resources Ltd ( Company or Winmar ) is pleased to announce that the Company has signed a Memorandum of Understanding with PXSteel International (Asia) Corporation Limited ( PXSteel ) to raise up to $6.65 million ( MoU ).

Pursuant to the MoU, Winmar has agreed to place:

• 6.5 million ordinary shares in the capital of the Company at $0.10 per share to raise $650,000 ( 1[st] Tranche ). These funds have already been received; and

• from 15 million and up to 30 million ordinary shares in the capital of the Company at $0.20 per share to raise between $3 to $6 million ( 2[nd ] Tranche ).

The funds raised will be used to fast track the current Winmar exploration program with a view to satisfying its earn-in obligations under its farm-in agreement with Cazaly Iron Pty Ltd ( Cazaly Iron ), wholly owned subsidiary of Cazaly Resources Limited ( ASX:CAZ ).

Issue of shares in connection with the 1[st] Tranche is conditional only on the Company obtaining shareholder approval to the issue of those shares. The Company has already received the 1[st] Tranche, but those funds will be held on trust for PXSteel by the Company until it has obtained shareholder approval to issue the shares. Prior approval is required under Listing Rule 7.9 due to the fact the Company has received notice of an intention to make a takeover bid announced by Dempsey Minerals Limited ( ASX:DMI ).

The 2[nd] Tranche is subject to the following conditions:

• a due diligence process completed to PXSteel’s satisfaction within 45 calendar days of the date of this announcement;

• relevant shareholder approvals for the issue of the 2[nd] Tranche shares;

• appointment of PXSteel’s nominee to the Board of the Company;

• no other changes to the Board of the Company prior to issue of the 2[nd] Tranche shares.

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C/- HLB Mann Judd (NSW) Pty Ltd, Level 19, 207 Kent Street, SYDNEY, NSW, AUSTRALIA, 2000 P. +61 2 8223 2888 E. admin@winmarresources.com.au W. www.winmarresources.com.au

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About PXSteel

PXSteel is part of Jiang Xi Ping Steel Industrial Co., Ltd ( Ping Steel ). Ping Steel was established in 1954 and has grown to become an influential, high growth modern iron ore and steel company. It is ranked 34[th] in the ‘Top Private Enterprises’ in China. According to its reports, it currently has assets of 25 billion Yuan (approximately A$4 billion) and annual production capacity of 10 million tonnes of steel. Ping Steel’s headquarter is in Nan Chang City, Jiang Xi Province, China.

Intended nomination of Ms. Tu Juan Han as a Non-Executive Director

In connection with the above transactions, PXSteel intends to nominate Ms. Tu Juan Han as a NonExecutive Director of the Company.

Ms. Han holds a PhD in Economics from Queen’s University in Canada. She is a Director and VicePresident of Ping Steel, and in that role assists the President of the company to manage foreign trade, foreign investment, and domestic and foreign purchases. Her previous roles include positions with the Canadian Central Bank, Royal Military College of Canada and Maitland Consulting.

Unsolicited Takeover Bid from DMI

The Company advises that DMI has announced its intention to make a conditional off-market scrip bid for all the shares in the Company. The offer consideration will be 4 DMI shares for every 7 shares of Winmar.

DMI has announced that it is in the process of preparing a Bidder’s Statement in relation to the offer and that it will lodge that document with ASIC in due course. The bid is unsolicited.

The preliminary view of the Board is that the quantum and timing of the offer is highly opportunistic, being made at a time of global economic uncertainty and share market volatility. It significantly undervalues the Company, both in light of the current placement to PXSteel and based on comparative valuations of Winmar and DMI.

Based on the last price of Winmar shares of 8.7c, the offer of 4 DMI shares for each 7 Winmar shares values DMI shares at 15.2c. According to the latest quarterly cashflow report filed by DMI, its shares have cash backing of only 4.1c per share. Its exploration grounds currently have no resources or reserves reported. Winmar reported a JORC resource estimate of 241.6 mt@54.3% Fe. In the opinion of Winmar Directors, the intended offer by DMI is nowhere near reflecting true value of Winmar’s assets.

The Company notes the takeover bid launched last week by MMK for Flinders Mines Limited at a 93% premium is an example of premiums commanded in this sector. Flinders’ tenements neighbour

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C/- HLB Mann Judd (NSW) Pty Ltd, Level 19, 207 Kent Street, SYDNEY, NSW, AUSTRALIA, 2000 P. +61 2 8223 2888 E. admin@winmarresources.com.au W. www.winmarresources.com.au

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exploration grounds of Winmar. The Board also notes that the reasons given by DMI as to why the bid

should be accepted by shareholders of Winmar focuses exclusively on the cash position of the Company and its failure to raise capital. The announcement in relation to the placement to PXSteel most certainly addresses these concerns. In the opinion of the Directors of Winmar, the Company was always solvent and able to pay its debts as and when they fall due and always had immediate access to cash if required. Any perceived delays with raising capital was due to the Board and Summit Equities seeking to extract the best value and the best deal for the shareholders of Winmar, under very difficult market conditions.

The Board also notes that the intended off-market takeover offer is by an entity whose Chairman was a former director of Winmar and is the joint Managing Director of Cazaly Resources Limited ( ASX:CAZ ), the parent company of Cazaly Iron and the counterparty to the Company’s farm-in agreement. The Board is currently receiving legal advice in relation to potentially unacceptable circumstances of the intended bid.

Notwithstanding, the Board will carefully consider the Bidder’s Statement when it is received before providing a response.

The Board recommends that shareholders take NO ACTION at this time. Once the Bidder’s Statement

is received in due course, the Board will provide further advice to shareholders including formal recommendations.

For further information, please contact:

Mr Albert Wong Mr Alex Alexander Executive Chairman Non-Executive Director Winmar Resources Limited Winmar Resources Limited 0414 928 888 02 8243 7501 albert@albertwong.biz alex.alexander@summitequities.com.au

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C/- HLB Mann Judd (NSW) Pty Ltd, Level 19, 207 Kent Street, SYDNEY, NSW, AUSTRALIA, 2000 P. +61 2 8223 2888 E. admin@winmarresources.com.au W. www.winmarresources.com.au