CORAZON MINING LIMITED — Proxy Solicitation & Information Statement 2011

Nov 15, 2011

Corazon Mining LiMited aCn 112 898 825 notiCe oF generaL Meeting

tiMe : 11.00 am (WST) date : 14 December 2011 PLaCe : Level 1, 350 Hay Street Subiaco WA 6008

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 on (+61 8) 6142 63 66.

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ContentS Page

ContentS Page
Business of the Meeting (setting out the proposed resolutions)	4
Explanatory Statement (explaining the proposed resolutions)	5
Glossary	7
Schedule 1 – Terms and Conditions of Options	8
Proxy Form	Enclosed
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 11.00 am (WST) on 14 December 2011 at:

Level 1, 350 Hay Street, Subiaco WA 6008

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 11.00 am (WST) on 12 December 2011.

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.

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).

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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:

• º the proxy is not recorded as attending the meeting;

• º 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 – 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 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 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 – PLaCeMent – 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 up to 21 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.

3. reSoLUtion 3 – PLaCeMent – 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 7.1 and for all other purposes, approval is given for the Directors to allot and issue 5 million Options 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.

dated: 14 noVeMBer 2011 BY order oF the Board

roBert orr CoMPanY SeCretarY

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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. BaCkgroUnd

As announced to ASX on 9 November 2011, the Company is undertaking a placement of up to approximately 36 million Shares at an issue price of $0.12 per Share to raise up to approximately $4.32 million ( Share Placement ).

The Company has engaged the services of Hartleys Limited (ACN 104 195 057) ( hartleys ), a licensed securities dealer (AFSL 230052), to act as Sole Lead Manager to the Share Placement and Peloton Capital Pty Ltd (ACN 149 540 018) ( Peloton ), a licensed securities dealer (AFSL 406040) to act as Co-Manager to the Share Placement.

Of the Share Placement, 15 million Shares were issued on or about 14 November 2011 ( First tranche Shares ). This was within the Company’s capacity under ASX Listing Rule 7.1 at the time. Resolution 1 seeks Shareholder ratification pursuant to ASX Listing Rule 7.4 for the issue of the First Tranche Shares.

Resolution 2 seeks Shareholder approval pursuant to ASX Listing Rule 7.1 for the allotment and issue of the balance of the Share Placement, being 21 million Shares ( Second tranche Shares ).

None of the subscribers pursuant to the Share Placement are, or will be, related parties of the Company.

2. reSoLUtion 1 – ratiFiCation oF Prior iSSUe – ShareS

2.1 general

On or about 14 November 2011, the Company issued 15 million Shares at an issue price of $0.12 per Share to raise $1.8 million.

Resolution 1 seeks Shareholder ratification pursuant to ASX Listing Rule 7.4 for the issue of those First Tranche 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 this issue, 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 issue of the First Tranche Shares:

• (a) 15 million Shares were allotted;

• (b) the issue price was $0.12 per Share;

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

• (d) the Shares were allotted and issued to investors who are clients of Hartleys, all of whom satisfy the requirements of either Sections 708(8), 708(10) or 708(11) of the Corporations Act and all of whom therefore fall within one of the exclusions for the requirement for the Shares to be issued under a disclosure document. None of these subscribers are related parties of the Company; and

• (e) the funds raised from the issue of the First Tranche Shares were used to further advance existing exploration at the Lynn Lake Nickel Sulphide Project in Canada and for general working capital purposes.

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3. reSoLUtion 2 – PLaCeMent – ShareS

3.1 general

Resolution 2 seeks Shareholder approval for the allotment and issue of up to 21 million Shares at an issue price of $0.12 per Share to raise up to $2.52 million.

A summary of ASX Listing Rule 7.1 is set out in Section 2.1 above.

The effect of Resolution 2 will be to allow the Directors to issue the Second Tranche Shares pursuant to the Share Placement 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 7.1

Pursuant to and in accordance with ASX Listing Rule 7.3, the following information is provided in relation to the issue of the Second Tranche Shares:

• (a) the maximum number of Shares to be issued is 21 million;

• (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 will be $0.12 per Share;

• (d) the Shares will be allotted and issued to investors who are clients of Hartleys and who satisfy the requirements of either Sections 708(8), 708(10) or 708(11) of the Corporations Act and therefore fall within one of the exclusions for the requirement for the Shares to be issued under a disclosure document. None of the subscribers will 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 Second Tranche Shares to further advance existing exploration at the Lynn Lake Nickel Sulphide Project in Canada and for general working capital purposes.

4. reSoLUtion 3 – PLaCeMent – oPtionS

4.1 general

Resolution 3 seeks Shareholder approval for the allotment and issue of 5 million Options ( option Placement ).

A summary of ASX Listing Rule 7.1 is set out in Section 2.1 above.

The effect of Resolution 3 will be to allow the Directors to issue the Options pursuant to the Option Placement 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 Option Placement:

• (a) the maximum number of Options to be issued is 5 million;

• (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 intended that allotment will occur on the same date;

• (c) the Options will be issued for nil cash consideration;

• (d) the Options will be allotted and issued to Zenix Nominees Pty Ltd, who is not 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 Option Placement.

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gLoSSarY

$ means Australian dollars.

aSX means ASX Limited.

aSX Listing rules means the Listing Rules of ASX.

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 Corazon Mining Limited (ACN 112 898 825).

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.

First tranche Shares means the 15 million Shares that were issued on or about 14 November 2011 pursuant to the Share Placement.

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

hartleys means Hartleys Limited (ACN 104 195 057), a licensed securities dealer (AFSL 230052).

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.

optionholder means a holder of an Option.

option Placement means the 5 million Options that the Company intends to issue, subject to Shareholder approval of Resolution 3.

Peloton means Peloton Capital Pty Ltd (ACN 149 540 018), a licensed securities dealer (AFSL 406040).

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.

Second tranche Shares means the 21 million Shares that the Company intends to issue, subject to Shareholder approval of Resolution 2, pursuant to the Share Placement.

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

Shareholder means a holder of a Share.

Share Placement means the placement of up to approximately 36 million Shares at an issue price of $0.12 per Share to raise up to approximately $4.32 million.

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 holder to subscribe for Shares on the following terms and conditions:

• (a) Each Option gives the Optionholder the right to subscribe for one Share.

• (b) Each Option will expire at 5.00pm (WST) on 1 December 2014 ( expiry date ). An Option not exercised before the Expiry Date will automatically lapse on the Expiry Date.

• (c) Subject to paragraph (k), the amount payable upon exercise of each Option will be $0.20 ( exercise Price ).

• (d) The Options held by each Optionholder may be exercised in whole or in part, and if exercised in part, multiples of 1,000 must be exercised on each occasion.

• (e) An Optionholder may exercise their Options by lodging with the Company, before the Expiry Date:

• (i) a written notice of exercise of Options specifying the number of Options being exercised; and

• (ii) a cheque or electronic funds transfer for the Exercise Price for the number of Options being exercised;

(collectively, exercise notice ).

• (f) An Exercise Notice is only effective when the Company has received the full amount of the Exercise Price in cleared funds.

• (g) Within 10 Business Days of receipt of the Exercise Notice accompanied by the Exercise Price, the Company will allot the number of Shares required under these terms and conditions in respect of the number of Options specified in the Exercise Notice.

• (h) The Options are not transferable except with the prior written consent of the board of directors of the Company.

• (i) All Shares allotted upon the exercise of Options will upon allotment rank pari passu in all respects with other Shares.

• (j) The Company will not apply for quotation of the Options on ASX. However, the Company will apply for quotation of all Shares allotted pursuant to the exercise of Options on ASX within 10 Business Days after the date of allotment of those Shares.

• (k) If at any time the issued capital of the Company is reconstructed, all rights of an Optionholder are to be changed in a manner consistent with the Corporations Act and the ASX Listing Rules at the time of the reconstruction.

• (l) There are no participating rights or entitlements inherent in the Options and Optionholders will not be entitled to participate in new issues of capital offered to Shareholders during the currency of the 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. This will give Optionholders the opportunity to exercise their Options prior to the date for determining entitlements to participate in any such issue.

• (m) An Option does not confer the right to a change in Exercise Price or a change in the number of underlying securities over which the Option can be exercised.

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