Freehills

Notice of initial substantial holder in relation to Grange Resources Limited

149 (including this one)
Company Announcements Office, ASX

We attach copies of notices of initial substantial holders on behalf of Shagang International Holdings Limited, RGL Holdings Co. Ltd and Pacific International Co. Pty Ltd, in respect of their holdings in Grange Resources Limited.

If you are not the intended recipient:

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please phone the sender immediately (reverse charges)
you must not disclose or use the information

QV.1 Building 250 St Georges Terrace Perth WA 6000 Australia Telephone +61 8 9211 7777 Facsimile +61 8 9211 7878 www.freehills.com

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Form 603 Corporations Act 2001
Section 671B

Notice of initial substantial holder

To Company Name/Scheme		Grange Resources Limited (Grange)
ACNIARSN	009 132 405

Details of substantial holder (1) 1.
Name			Shagang International Holdings Ltd (Shagang) and each of the entities and persons set out in Annexure A (Associates)
ACN/ARSN (if applicable)	Not applicable
The holder became a substantial holder on		2 January 2009
Details of voting power 2.

The total number of votes attached to all the voting shares in the company or voting interests in the scheme that the substantial holder or an associate (2) had a relevant interest (3) in on the date the substantial holder became a substantial holder are as follows:

Class of securities (4)	Number of securities	Person's votes (5)	Voting power (6)
Ordinary	343.038.639	343.038.639	69.3%, based on 495,343,653 lordinary shares on issue as at 2 Uanuary 2009

3. Details of relevant interests

The nature of the relevant interest the substantial holder or an associate had in the following voting securities on the date the substantial holder became a substantial holder are as follows:

Holder of relevant interest	Nature of relevant interest (7)	Class and number of securities
Shagang and Associates	Relevant interest under subsections [608(1) (holder) of the Corporations Act 2001 (Cth).	343,038,639 fully paid ordinary shares

4. Details of present registered holders

The persons registered as holders of the securities referred to in paragraph 3 above are as follows:

Holder of relevant interest	Realstered holder of securities	Person entitled to be registered as holder (8)	Class and number of securities
Shagang and Associates	Shagang International Holdings IL ta	Shagang International Holdings .td	232.575.639
Shagang and Associates	RGL Holdings Co. Ltd	RGL Holdings Co. Ltd	68,404,600
Shagang and Associates	Pacific International Co. Pty Ltd	Pacific International Co. Pty Ltd	41.042.760
Shagang and Associates		Ever Lucky Developments Limited Ever Lucky Developments Limited 1,015,640

5. Consideration

The consideration paid for each relevant interest referred to in paragraph 3 above, and acquired in the four months prior to the day that the substantial holder became a substantial holder is as follows: .
.................................... an kalendari dan kecamatan di kecamatan di kecamatan di kecamatan di kecamatan di kecamatan di kecamatan di ke
Kecamatan di kecamatan di kecamatan di kecamatan di kecamatan di kecamatan di kecamatan di kecamatan di kecama ______________________________________

Holder of relevant interest	Date of acquisition	Consideration (9)		Class and number of securities
	a sa	Gash	Non-cash
Shagang and Associates	2 January 2009	The consideration is the transfer by Shagang, RGL Holdings Co. Ltd and Pacific International Co. Pty Ltd of 100% of the total issued capital of Ever Green Resources Co. Ltd to Grange Resources Limited on the terms of the Share Sale Agreement and Merger Implementation Agreement both dated 24 September 2008, and attached as Annexure B and Annexure C respectively.	1188	342,022,999 ordinary Ishares

1712574

6. Associates

The reasons the persons named in paragraph 3 above are associates of the substantial holder are as follows:

Name and ACN/ARSN (if applicable)	Nature of association
RGL Holdings Co. Ltd and Pacific international Co. Pty Ltd (ACN 133 363 265)	Shagang, RGL Holdings Co. Ltd and Pacific International Pty Ltd may in certain circumstances act jointly in respect of their investment where their interests are laligned, which means that they are deemed to be associates under section 12(2) of the Corporations Act 2001 (Cth).
Bodies corporate listed in Annexure A	Each of the bodies corporate and persons listed in Annexure A is a related body corporate or controller of either Shagang. RGL Holdings Co. Ltd or Pacific International Pty Ltd, therefore they are associates under section 12(2) of the Corporations Act 2001 (Cth).

7. Addresses

The addresses of persons named in this form are as follows:

Name	Address
Shagang	Uinfeng Town, Zhangjiagang City, Jiangsu Province in the People's Republic of China (Postcode 215626)
IRGL Holdings Co. Ltd	23/F, New Poly Plaza, No. 1 North Chaoyangmen Street, Dongcheng District, Beijing in the People's Republic of China
Pacific International Co. Pty Ltd	Unit 2102, 21F Sino Plaza, 255-257 Gloucester Road, Causeway Bay, Hong Kong

Signature

print name	Shen Bin		capacity	Director
sign here	.	- - -	-- -- . $\sim$ date	January 2009
		COLLECT

DIRECTIONS

If there are a number of substantial holders with similar or related relevant interests (eg. a corporation and its related corporations, or the manager and
trustee of an equity rrust), the names could be included in an ann $(1)$

$(3)$ See the definition of "relevant interest" in sections 608 and 671B(7) of the Corporations Act 2001.
$\left\langle 4 \right\rangle$ The voting shares of a company constitute one class unless divided into separate classes.
$\left(5\right)$ The total number of votes attached to all the voting shares in the company or voting interests in the scheme (if any) that the person or an associate has a relevant interest in.
$\langle 6 \rangle$ The person's votes divided by the total votes in the body corporate or scheme multiplied by 100.
Include details of: $(7)$
any relevant agreement or other circumstances by which the relevant interest was acquired. If subsection 671B(4) applies, a copy of any $(a)$ discussion and discussion of the terms of any relevant agreement, and a statement by the person giving full and accurate details of any contract, scheme or arrangement, must accumpany this form, together with a written sta
any qualification of the power of a person to exercise, control the exercise of, or influence the exercise of, the voting powers or disposal of the
securities to which the relevant interest relates (indicating clearly the $(b)$

See the definition of "relevant agreement" in section 9 of the Corporations Act 2001.

If the substantial holder is unable to determine the identity of the person (eg. if the relevant interest arises because of an option) write "unknown." $(8)$

\712574

See the definition of "associate" in section 9 of the Corporations Act 2001. $(2)$

Datails of the consideration must include any and all benefits, moneys and other, that any person from whom a relevant interest was acquired has, or
may, become entitled to receive in relation to that acquisition. Details $\langle 9 \rangle$

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Annexure A

Shagang International Holdings Limited

This is Annexure A of 3 pages referred to in Form 603 "Notice of Initial Substantial Holder" signed by me and dated 6 January 2009.

sian here

print name Shen Bin/Director

Ltd

Associates of Shagang International Holdings Ltd.

Zhangjiagang City Shagang Copper Evergain International Corporation Co., Ltd Zhangjiagang City Yong'an Steel Co., Ever Lucky Development Limited Ltd Zhangjiagang East Gas-making Fayuan Steel Burden Trade Co., Ltd. Corporation Hade Union (Zhangjiagang City) Petrochemical Industry Co., Ltd Zhangjlagang Haili-wharf Co., Ltd Hongrun Real Estate Development Co., Zhangjiagang Hengchang Neotype Tignum Co., Ltd Zhangjiagang Hengchang Precision Iron-making of Jiangsu Shagang Group Co., Ltd milling Co., Ltd Jiangsu Runzhong High-tech Zhangjiagang Hengle Neotype Tignum Corporation Co., Ltd Zhangjiagang Hongchang Gas-making Jiangsu Shagang Group Co., Ltd. Co., Ltd Jiangsu Shagang Group Huaigang Zhangjiagang Hongchang High-speed Special Steel Co., Ltd Wire Co., Ltd Jiangsu Shagang Group Xinrui Special Zhangjiagang Hongchang Pelletzing Steel Co., Ltd Co., Ltd Zhangjiagang Hongchang Ship-tearing Jiangsu Shagang Group Zhangjiagang Kaihua Press Co., Ltd Co., Ltd Zhangjiagang Hongchang Steel-bar Co., Jiangsu Shagang International Trade Co., Ltd Ltd Zhangjiagang Hongchang Steel-plate Jiangsu Yong Steel Group Co., Ltd Co., Ltd Zhangjiagang Hongfa Steel-making Co., Jiangyin City Runde Assets Co., Ltd Ltd

Jinde Trade Co., Ltd.

Qianyuan Metal Trade Co., Ltd

Rongde Trade Co., Ltd.

Runyuan Stainless Steel Co., Ltd.

Shagang (Singapore) Pte Ltd

Shagang Group Living-service Co., Ltd

Shagang International (Hong Kong) Co. Ltd.

Shagang International Holdings Ltd.

Shagang Mining (Australia) Pty Ltd

Shagang Occupation-service & Human resource Development Co., Ltd

Shagang Shipping Co., Ltd

Shagang SouthAsia (Hong Kong) Trading Co., Ltd

Shajing International Trade Co., Ltd

Mr Wenrong Shen

Zhangjiagang City Hongda Transportion Co., Ltd

Zhangjiagang City Huadong Scrap steel Trade Co., Ltd

Zhangjiagang City Pharmaceutical Factory

Zhangjiagang City Scrap Steel Processing & Supplying Company

Associates of RGL Holdings Co Ltd.

Alasan Meng Huaxi Trading Co., Ltd.

Alasan Meng Jinganglian Co., Ltd.

Alasan Meng RGL Industry Development Co., Ltd.

Zhangjiagang Hongxing High-speed Wire Co., Ltd

Zhangjiagang Huasha Autodevelopment Co., Ltd

Zhangjiagang Huasheng Iron-making Co., Ltd.

Zhangjiagang Jingde Steel-plate Co., Ltd

Zhangjiagang Posco Stainless Steel Co., Ltd

Zhangjiagang Pusha-wharf Co., Ltd

Zhangjiagang Rongde Stainless-steel Product Co., Ltd.

Zhangjiagang Rongsheng Steel-making Co., Ltd

Zhangjiagang Runzhong Steel Co., Ltd

Zhangjiagang Sanhe-Shagang Hightemperature Technology Co., Ltd

Zhangjiagang Shagang Tongxin Galvanized -steel Co., Ltd

Zhangjiagang Shajing Steel Co., Ltd

Zhangjiagang Shajing Wide & heavy Plate Co., Ltd

Zhangjiagang Shatai Steel Co., Ltd

Zhangjiagang Xiaosha Steel Processing Co., Ltd

Zhangjiagang Xingrong Coated Board Co., Ltd

Zhangjiagang Xingrong Iron-making Co., Ltd

Zhangjiagang Yongxin Steel Co., Ltd

RGL International Co., Ltd

Shanghai Jingxi Industry Co., Ltd.

Shanghai Ruixilian Industry Co., Ltd.

Beijing RGL Science Development Co., Ltd.	Shanghai Ruixilian Trading Co., Ltd.
Fujian RGL Trading Co., Ltd.	Shanghai Ruivelian Industry Co., Ltd.
Fuzhou RL Steel Co. Ltd.	Shenzhen RGL Industry Co., Ltd.
Fuzhou RL Trading Co., Ltd.	Wuhan RGL Industry and Trade Co., Ltd.
Jiaozuo Ruiwang Industry Co., Ltd.	Yiyang Yifeng Road and Bridge Development Co., Ltd.
RGL Group Co., Ltd.	Shanghai Huaxi Industry Co., Ltd.

Mr Zhenhua You

Associates of Pacific International Co Pty Ltd.

Acefair Pacific Limited	Pacific Minerals Investment Limited
Eastchoice Pacific Limited	Pacific Minerals Limited
Ever Green Resources Co., Limited. (Formerly known as Shagang Mining Co., Ltd.)	Pacific Minerals Trading Limited
Fastlane Limousine Co., Ltd. (Acefair Pacific Ltd. is 60% shareholder).	Pacific Shipping Limited
Mainway Resources Limited	Shanghai Pacific Minerals Limited
Mineral Power Limited	Suzhou Metallurgical Resources (Hong Kong) Company Limited
Pacific International Business Limited	Mr Cheung (Clement) Ko

Pacific International Co., Pty Ltd.

Annexure B

Shagang International Holdings Limited

This is Annexure B of 102 pages referred to in Form 603 "Notice of Initial Substantial Holder" signed by me and dated 6. January 2009.

The attached document is certified as a true copy.

sign here

print name Shen Bin/Director

Agreement

Share Sale Agreement

Great Period Limited Peak Scale Investments Limited Pacific International Co. Pty Ltd Stemcor Pellets Limited Grange Resources Limited Shagang International (Hong Kong) Co., Ltd RGL International Co., Ltd Stemcor Holdings Limited

Freehills

QV.1 Building 250 St Georges Terrace Perth WA 6000 Australia GPO Box U1942 Perth WA 6845 Australia

Telephone +61 8 9211 7777 Facsimile +61 8 9211 7878 www.freehills.com DX 104 Perth

Sydney Melbourne Perth Brisbane Singapore

Correspondent offices in Hanoi Ho Chi Minh City Jakarta

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Contents

	Table of contents	1
	The agreement	1
	Operative part	3
	Definitions and interpretation	3
1.1 1.2 1.3 1.4 1.5 1.6	Agreement components Definitions Interpretation provisions Inclusive expressions Obligations and rights of Sellers Authority to act
	Conditions Precedent	16
2.1 2.2 2.3 2.4 2.5 2.6 2.7	Conditions Best endeavours Waiver of conditions precedent Consultation on failure of condition precedent 19. Certain notices Cut Off Date No binding agreement for transfer
	Sale and purchase	20
3.1 3.2 3.3 3.4	Sale Shares Associated Rights Title and risk Consideration Shares	-20
	Period before Completion	21
4.2 4.3 4.4 4.5 4.6 4.7 4.8 4.9	4.1 Access for Grange Access for Shagang Carrying on of Transaction Entities Business Carrying on of Grange Group Business Permitted acts Locked Box Parent Guarantees Seller Obligations Savage River SPA Consideration	21
	Termination	26
5.1 5.2 5.3	Termination by Grange Termination by the Sellers Automatic termination

$\mathcal{A}^{\mathcal{A}}$

	5.4 5.5	Effect of termination No other right to terminate or rescind
6		Pre-Completion actions	27
	6.1	Board resolutions
7		Completion	28
	7.1	Time and Place
	7.2	Completion
	7.3	Sellers' obligations at Completion
	7.4	Grange's obligations at Completion
	7.5	Notice to complete
	7.6	Completion simultaneous
	7.7	Post Completion actions
8		Warranties and Indemnities	30
	8.1	Warranties by the Sellers and Ever Green Sellers
	8.2	Warranties by Grange
	8.3	Independent Warranties
	8.4	Reliance
	8.5 8.6	Indemnity for breach of Warranty Ever Green Sellers' Tax Indemnity
	8.7	Survival of representations
	8.8	Survival of indemnities
9		Qualifications and limitations on Claims	33
	9.1	Sellers' and Ever Green Sellers' liability
	9.2	Interpretation
	9.3	Disclosure
	9.4	No reliance
	9.5	Opinions, estimates and forecasts
	9.6	Maximum and minimum amounts
	9.7	Time limits
	9.8	Recovery under other rights and reimbursement
	9.9	No double claims
		9.10 Mitigation of loss
	9.11	General limitations Limitations in relation to Tax
	9.12 9.13	Sole remedy
	9.14	Independent limitations
10		Procedures for dealing with Claims	39
	101	Notice of Claims
	10.2	Third Party Claims
		10.3 Tax Demands
11		Period after Completion	42
		11.1 Pre-Completion tax returns
		11.2 Treatment of Tax refunds
12	GST		45
	12.1	Definitions
	12.2	GST
	12.3	Tax invoices and adjustment notes
		12.4 Reimbursements

		12.5 Information, returns and accounting to end GST Group
	12.6	Supplies between former members of the GST Group
13		Guarantee by Shagang Guarantor and RI Guarantor	47
	13.1	Guarantee and indemnity
	13.2	Extent of guarantee and indemnity
	13.3	Principal and independent obligation
	13.4	Continuing guarantee and indemnity
	13.5	Waiver of Rights
	13.6	No withholdings
	13.7	Currency
	13.8	Guarantor's Liability
	13.9	Restrictions on Guarantor's Dealings
14		Guarantee by Stemcor Guarantor	49
	14.1	Guarantee
	14.2	Extent of guarantee
	14.3	Principal and independent obligation
	14.4	Continuing guarantee
	14.5	No withholdings
	14.6	Currency
	14.7	Guarantor's Liability
	14.8	Termination of Guarantor's Liability
15		Escrow restrictions	50
	15.1	Restrictions during the Escrow Period
	15.2	Holding Lock
	15.3	Notice
	15.4	Consequences of breaching this clause 15
16		Duty, costs and expenses	51
	16.1	Stamp duty
		16.2 Costs and expenses
17		Confidentiality	52
18	General		53
	18.1	No representation or reliance
	18.2	No merger
	18.3	Prohibition and enforceability
	18.4	Severability
	18.5	Consents
	18.6	Notices
	18.7	Service of process
	18.8	Governing law and jurisdiction
	18.9
		18.10 Variation
		18.11 Assignment
		18.12 Further action
		18.13 Entire agreement
		18.14 Counterparts
		Table of contents	57

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Warranties	58
Definitions	58
Individual Seller Warranties	64
2.1 No legal impediment 2.2 Corporate Authorisations 2.3 Power and capacity Incorporation 2.4 2.5 Seller Group Members 2.6 65 2.7 Enforceability 2.8 The Sale Shares Breach or default 2.9 2.10 86/wency 2.11
	67
Breach or default 3.1 3.2 Consents Shares and share capital 3.3 68. Corporate matters 3.4 Conduct of business 3.5 3.6 69. Assets, liabilities and financing arrangements 3.7 3.8 Contracts Real property and environmental 3.9 3.10 Mining Tenements Intellectual property and confidential information 3.11 3.12 Systems 3.13 Employees 3.14 80. Superannuation Legal proceedings 3.15 3.16 18 msurance 3.17 81. Disclosure 3.18
Grange Warranties 4.1 No legal impediment 4.2 85. 4.3 Power and capacity 4.4 185. Theoryoration 65. Grange Group Members 4.5 4.6 No trust 4.7 Enforceability No material proceedings 4.8 No threatened material proceedings 4.9 4.10 No outstanding orders 4.11 Undertakings 4.12 Compliance with laws 4.13 Authorisations 4.14 Compliance with Authorisations 4.15 Termination	85 85
	Shareholder Loan Agreements Ever Green Warranties 4.16 No revocations

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4.17	No prejudice of Material Authorisations
4.18	Compliance
4.19	This agreement
4.20	Disclosure
4.21	Information provided
4.22	Tax paid
4.23	Provision in Accounts
4.24	Withholding tax
4.25	No capital gains tax relief
4.26	Records
4.27	89. Returns submitted
4.28 4.29	No Tax audit No disputes
4.30	Franking credits
4.31	Stamping
4.32	No tainting
4.33	GST
4.34	Contracts
4.35	00
	Schedule 2	91
	Schedule of Capital	91
	Ever Green	91
SMAPL		91
	Beviron Pty Ltd	91
	Goldamere Pty Ltd	92
	Signing page	93
	Executed as an agreement	93

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The agreement

Share Sale Agreement

Date $\blacktriangleright$

Between the parties
Sellers	Great Period Limited
	(soon to be named Shagang International Holdings Limited) registration number 1497243 of PO Box 957, Offshore Incorporations Centre, Road Town, Tortola, British Virgin Islands
	(Shagang)
	Peak Scale Investments Limited
	(soon to be named RGL Holdings Co., Ltd) registration number 1497715 of PO Box 957, Offshore Incorporations Centre, Road Town, Tortola, British Virgin Islands
	(RI)
	Pacific International Co. Pty Ltd
	ACN 133 363 265 of 60 Wilmot Street, Burnie, Tasmania
	(PI)
	Stemcor Pellets Limited
	registered no. 2188847 of Level 27, City Point, 1 Ropemaker Street, London, EC2 Y9ST, United Kingdom
	(Stemcor)
Grange	Grange Resources Limited
	ACN 009 132 405 of Level 11, 200 St Georges Terrace, Perth WA 6000
	(Grange)
Guarantors	Shagang International (Hong Kong) Co., Ltd
	registration number 1257375 of Unit 2902, 29/F, Far East Finance Centre, 16 Harcourt Road, Admiralty Hong Kong
	(Shagang Guarantor)
	RGL International Co., Ltd
	registration number 1273053 of 23/F, New Poly Plaza, No. 1 North Chaoyangmen Street, Dongcheng District, Beijing, in the People's

The agreement

	Republic of China
	(RI Guarantor)
	Stemcor Holdings Limited
	registered no. 1038435 of Level 27, City Point, 1 Ropemaker Street, London, EC2 Y9ST, United Kingdom
	(Stemcor Guarantor)
	(together, the Guarantors)
Background	The Sellers own the Sale Shares. 1
	The Sellers have agreed to sell and Grange has agreed to buy $\overline{2}$ the Sale Shares on the terms and conditions of this agreement.
	This agreement records the sale and purchase of the Sale 3 Shares.
	The Shagang Guarantor has agreed to guarantee the obligations 4 of Shagang, the RI Guarantor has agreed to guarantee the obligations of RI under this agreement and the Stemcor Guarantor has agreed to guarantee the obligations of Stemcor under this agreement.
The parties agree	as set out in the operative part of this agreement, in consideration of, among other things, the mutual promises contained in this agreement.

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Operative part

Definitions and interpretation $\mathbf 1$

$1.1$ Agreement components

This agreement includes any schedule.

$1.2$ Definitions

In this agreement capitalised expressions have the meanings set out below. This agreement will be interpreted in accordance with clause 1.3.

Term	Meaning
ABM	Goldamere Pty Ltd (a wholly owned subsidiary of Beviron Pty Ltd), a company trading under the name "Australian Bulk Minerals".
Accounts Date	30 June 2008.
Approved Payments	any payment of the Fixed Consideration, the Head Agreement Consideration and the Deferred Consideration, as those terms are defined in the Savage River Sale and Purchase Agreement, required under the Savage River Sale and Purchase Agreement; and
	any repayment of all or part of the amount of the balance owing to Evergain International Corporation (Evergain) in respect of a prepayment by Evergain for iron ore pellet shipments which balance was stated as A\$21,237,186 as of 30 June 2008.
ASIC	the Australian Securities and Investments Commission.
ASX	the Australian Securities Exchange operated by ASX Limited (ACN 008 624 691).
Authorisation	any approval, licence, consent, authority, registration or permit.
Base Case Assumptions	the key valuation assumptions in respect of the Southdown Project in the agreed form.
Beviron Pty Ltd	Beviron Pty Ltd ACN 078 197 323.

Term	Meaning
BNP Paribas Facility Drawdown	the drawdown of up to \$40 million under the Facility Agreement between Goldamere Pty Ltd and BNP Paribas (ABN 23 000 000 117) dated 12 June 2008.
Business Day	a day on which banks are open for business in Perth, other than a Saturday, Sunday or public holiday in Perth.
Business Records	all original and certified copies of the books, records, documents, information, accounts and data (whether machine readable or in printed form) owned by or relating to a Transaction Entity or the property of a Transaction Entity and any source material used to prepare them.
Claim	any claim, demand, legal proceedings or cause of action including any claim, demand, legal proceedings or cause of action:
	based in contract (including breach of warranty); 1
	based in tort (including misrepresentation or negligence); 2
	under common law; or 3
	under statute (including Part V or VI of the Trade Practices Act 1974 (Cth)), 4 or like provisions in any state or territory legislation,
	in any way relating to this agreement or the Transaction and includes a claim, demand, legal proceedings or cause of action arising from a breach of Warranty, under an indemnity in any Transaction Agreement.
Completion	completion of the sale and purchase of the Sale Shares under clause 7.
Completion Date	the date on which Completion occurs.
Confidentiality Agreement	the confidentiality agreement dated 24 December 2007 between Ever Green Resources Co., Ltd (formerly, Shagang Mining Company Limited (Hong Kong)) and Grange.
Consideration	Grange issuing the Consideration Shares to the Sellers.
Consideration Shares	380,025,554 fully paid ordinary shares in Grange.
Consolidated Group	a Consolidated Group or a MEC group as those terms are defined in section 995-1 of the ITAA 1997.
Corporations Act	the Corporations Act 2001 (Cth).
Cut Off Date	31 December 2008.

$\sim$

Term	Meaning
Demand	a written notice of, or demand for, an amount payable.
Dispose	in respect of any Consideration Share, means to: dispose of, or agree or offer to dispose of, that Consideration Share or any 1 legal beneficial or economic interest in that Consideration Share; sell, transfer, assign, mortgage, encumber (including by creating a 2 mortgage, charge, pledge, lien, encumbrance, security interest, title retention, preferential right, trust arrangement, contractual right of set-off or any other security agreement or arrangement in favour of any person) or otherwise dispose (as defined in the Listing Rules) of, or agree or offer to dispose of (including by way of option); create, or agree or offer to create any Security Interest in that Consideration 3 Share or any legal, beneficial or economic interest in that Consideration Share; or do, or omit to do, any act if the act or omission would have the effect of 4 transferring effective ownership or control of that Consideration Share or any legal, beneficial or economic interest in that Consideration Share.
Disputing Action	in respect of Tax Demand, any action to cause the Tax Demand to be withdrawn, reduced or postponed or to avoid, resist, object to, defend, appear against or compromise the Tax Demand and any judicial or administrative proceedings arising out of that action.
Duty	any stamp, transaction or registration duty or similar charge imposed by any Governmental Agency and includes any interest, fine, penalty, charge or other amount imposed in respect of any of them, but excludes any Tax.
Encumbrance	an interest or power: reserved in or over an interest in any asset including any retention of title; or 1 created or otherwise arising in or over any interest in any asset under a bill $\mathbf{2}$ of sale, mortgage, charge, contractual right of set-off, lien, pledge, trust or power, by way of security for the payment of a debt, any other monetary obligation or the performance of any other obligation, and includes, but is not limited to, any agreement to grant or create any of the above (whether registered or unregistered).
Ever Green	Ever Green Resources Co., Ltd registration number 1133902.
Ever Green Sellers	RI, PI and Shagang.
Ever Green Sale Shares	the Shagang Shares, the RI Shares and the PI Shares.
Ever Green Shareholder Loan Agreements	the Shagang Shareholder Loan Agreement, the RI Shareholder Loan Agreement and the PI Shareholder Loan Agreement.

Term	Meaning
Ever Green Warranties	the representations and warranties in Schedule 1 given by the Ever Green Sellers under the section entitled 'Ever Green Warranties'.
Existing Tenements	the mining leases 2M/2001 and 14M/2007 and exploration licences 30/2003, 19/2005 and 46/2007.
FATA	the Foreign Acquisitions and Takeovers Act 1975 (Cth).
Goldamere Pty Ltd	Goldamere Pty Ltd ACN 073 634 581.
Governmental Agency	any government or governmental, administrative, monetary, fiscal or judicial body, department, commission, authority, tribunal, agency or entity in any part of the world.
Grange Disclosure Materials	all documents and information that were at any time during the period from 1. 14 January 2008 up to and including 5 days before the execution of this agreement contained in the electronic data room established at https://www.clients.claytonutz.net/Grange. and the hard copy data room maintained at Grange's offices at Level 11, 200 St Georges Terrace, Perth WA 6000 and made available to the Sellers, their representatives or advisers and any additional material provided directly to the Sellers' advisers by Grange or Grange's advisers; and all information set out, or referred to, in any document or email provided by 2 any Grange Group Member or any of their agents, advisers or representatives to the Sellers or any of their agents, advisers or representatives in connection with the negotiations for the Transaction.
Grange Group	Grange and each of its Related Bodies Corporate (other than the Transaction Entities) and Grange Group Member means any member of Grange Group.
Grange Group Accounts	in respect of each Grange Group Member the audited balance sheet of that Grange Group Member as at the Accounts Date and the audited profit and loss account of that Grange Group Member for the year ending on the Accounts Date.
Grange Group Business	the business carried out by the Grange Group.
Grange Material Adverse Change	a change to the business, financial or trading position or prospects of Grange Group or the operations or assets of Grange Group which occurs between 1 July 2008 and Completion that has, or is reasonably likely to have, a material adverse effect on any Grange Group Member, other than:
	a change resulting from financial market fluctuations (including the Grange 1 share price), changes in interest rates and changes in tax, securities or other applicable laws;
	a change resulting from the Transaction Agreements or the Transaction; 2 a change resulting from conditions affecting the iron ore industry, including 3

Term	Meaning
	changes affecting the iron ore pellet price, concentrate price and chip price (but not changes in steel prices);
	a change to the Base Case Assumptions regarding capital expenditure and 4 operational expenditure where the magnitude of the change is an increase of less than 20% and 15% respectively from the Base Case Assumption level. In assessing the magnitude of any change to the Base Case Assumptions for this purpose, that proportion of any change which is due to either of the following must be excluded:
	(a) movements in exchange rates; or
	(b) changes from the agreed scope of the Southdown Project (as agreed in writing by Shagang); or
	(c) changes relating to the Kemaman Pellet Project;
	a change regarding timing milestones where the magnitude of the change 5 results in a delay of the Southdown production date of less than 6 months from 30 June 2013, assuming the Transaction completes before 31 December 2008. The production date will be delayed by the same period as any delay in Completion post 31 December 2008. In assessing the magnitude of any change regarding timing milestones for this purpose, that proportion of any change which is due to changes from the agreed scope of the Southdown Project (as agreed in writing by Shagang) or movements in exchange rates or changes relating to the Kemaman Project must be excluded; or
	a change which restricts the ability to develop the Kemaman Pellet Project. 6
	For clarity, a deterioration in the share price of Grange does not constitute a change to the business, financial or trading position or prospects of Grange Group or the operations or assets of Grange Group.
Grange NOM	a notice of meeting and explanatory memorandum (including the Independent Expert's Report and any accompanying documents) convening the extraordinary general meeting of Grange to approve the Transaction.
Grange Shareholders	the shareholders of Grange.
Grange Warranties	the representations and warranties in Schedule 1 given by Grange under the section entitled 'Grange Warranties'.
GST	goods and services tax or similar value added tax levied or imposed in Australia under the GST Law or otherwise on a supply.
GST Act	the A New Tax System (Goods and Services Tax) Act 1999 (Cth).
GST Group	has the same meaning as that term is defined in the GST Act.
GST Law	has the same meaning as in the GST Act.

$\bar{z}$

Term	Meaning
Guarantee	any guarantee, bond, security, deposit, letter of credit or suretyship or any other obligation to pay, purchase or provide funds (whether by the advance of money, the purchase of or subscription for shares or other securities, the purchase of assets or services, or otherwise) for the payment or discharge of, to indemnify against the consequences of default in the payment of, or otherwise be responsible for, any indebtedness of, obligation of, liability of or the insolvency of any other person.
Immediately Available Funds	cash, bank cheque or telegraphic or other electronic means of transfer of cleared funds into a bank account nominated in advance by the payee.
Independent Expert's Report	a report prepared by a suitably qualified independent expert stating whether the Transaction is fair and reasonable to Grange's Shareholders.
Individual Seller Warranties	the representations and warranties in Schedule 1 given by the Sellers under the section entitled 'Individual Seller Warranties'.
ITAA 1997	the Income Tax Assessment Act 1997 (Cth).
Kemaman Pellet Project	the Kemaman Iron Ore Pellet Plant Project located in the state of Terengganu, Malaysia in which Grange holds a controlling interest.
Listing Rules	the ASX Listing Rules.
Loss	in relation to any fact, matter or circumstance, all losses, liabilities, damages, costs, charges, penalties and expenses and includes Taxes, Duties and Tax Costs, arising out of that fact, matter or circumstance and includes all legal and professional expenses on a solicitor client basis incurred in connection with investigating, disputing, defending or settling any claim, action or demand or proceeding relating to that fact, matter or circumstance (including any claim, action, demand or proceeding based on the terms of this agreement).
Material Adverse Effect	when used in a Warranty in relation to an entity, a material and adverse effect on the financial condition, or operations or prospects of that entity (when compared to what the financial condition, or operations or prospects of that entity would be if the Warranty were true).
Material Authorisations	in respect of a Transaction Entity, as defined in Ever Green Warranty 3.6(b); and in respect of Grange or a Grange Group Member, as defined in Grange Warranty 4.13.
Material Proceedings	is defined in Grange Warranty 4.8.
Merger Implementation	the agreement entered into on or about the date of this agreement by Shagang

Term	Meaning
Agreement	and Grange.
Off-Take Resolutions	the resolutions described in clause $4.1(b)(2)$ of the Merger Implementation Agreement.
Outstanding Savage River Payments	the value of the consideration (the Fixed Consideration, the Head Agreement Consideration and the Deferred Consideration, as those terms are defined in the Savage River Sale and Purchase Agreement) which is payable, as at the date of entering into this agreement, by SMAPL under the Savage River Sale and Purchase Agreement.
Parent Guarantees	any guarantees, indemnities, charges or other securities fairly disclosed in the Sellers Disclosure Materials given by a Seller Group Member to a third party to better secure the performance of a Transaction Entity or required for the benefit of a Transaction Entity.
PI Shareholder Loan Agreement	the loan agreement between PI and Ever Green dated 24 September 2008.
PI Shares	360,000 ordinary shares in Ever Green held by PI at the date of this agreement.
Pre Completion Returns	is defined in clause 11.1.
Pre-sale Transactions	the pre-sale transactions advised by each of Shagang, RI and PI separately to Grange in writing prior to the date of this agreement.
Proper ASTC Transfer	has the meaning given to that term in the Corporations Regulations 2001 (Cth).
Proposal	any offer or proposal in respect of any transaction (by joint venture, purchase, merger, amalgamation, arrangement, business combination, liquidation, dissolution, recapitalisation, takeover bid or otherwise) that would, if completed substantially in accordance with its terms, result in a third party acquiring more than 50% of the issued share capital in Grange or Grange disposing of or charging 50% or more of its interest in its material assets.
Reference Date	30 June 2008.
Reference Date Balance Sheet	the consolidated balance sheet of the Transaction Entities as at the Reference Date initialled by each of the parties prior to signing of this agreement.
Related Body Corporate	has the meaning given in section 9 of the Corporations Act.

$\sim$

$\mathcal{L}_{\mathcal{A}}$

Term	Meaning
RI Shareholder Loan Agreement	the loan agreement between RI and Ever Green dated 24 September 2008.
RI Shares	600,000 ordinary shares in Ever Green held by RI at the date of this agreement.
Sale	the sale and purchase of the Sale Shares in accordance with clause 3.
Sale Shares	the Ever Green Sale Shares and the Stemcor Shares.
Savage River Sale and Purchase Agreement	the sale and purchase agreement dated 12 April 2007 for the sale of shares in Beviron Pty Ltd, as novated per the deed of novation dated 7 August 2007 to SMAPL as the Substitute Buyer (as defined in that agreement).
Security Interest	an interest or power:
	reserved in or over an interest in any Consideration Shares including, but 1 not limited to, any retention of title;
	created or otherwise arising in or over any interest in any Consideration 2 Shares under a bill of sale, mortgage, charge, lien, pledge, trust or power by way of security for the payment of debt or any other monetary obligation or the enforcement of any other obligation; and
	any agreement to grant or create any interest or power referred to in 3 paragraphs 1 or 2 of this definition.
Seller Group	each Seller and its Related Bodies Corporate (other than the Transaction Entities) and Seller Group Member means any member of either of the Seller Groups.
Seller Information	information regarding the Sellers, the Transaction Entities and ABM provided by the Sellers, the Transaction Entities and ABM to Grange for inclusion in the Grange NOM.
Sellers	the Ever Green Sellers and Stemcor.
Sellers Disclosure Materials	all documents and information that were at any time during the period from 1. 14 May 2008 up to and including 5 days before execution of this agreement contained in the online data room established at ftp://mail.ausbm.com.au and made available to Grange, its representatives or advisers and any additional material provided directly to Grange's advisers by the Transaction Entities, ABM or the Sellers' advisers; and all information set out, or referred to, in any document or email provided by $\mathbf{2}$ any Seller Group Member or Transaction Entity or any of their agents, advisers or representatives to Grange or any of its agents, advisers or representatives in connection with the negotiations for the Transaction.

$\mathcal{A}^{\pm}$

Term	Meaning
Seller's GST Group	the GST Groups which includes a Seller as a member.
Settlement Rules	ASTC Settlement Rules as amended from time to time.
Shagang Shareholder Loan Agreement	the loan agreement between Shagang and Ever Green dated 24 September 2008.
Shagang Shares	2,040,000 ordinary shares in Ever Green held by Shagang at the date of this agreement.
Shareholder Loan Agreements	the Ever Green Shareholder Loan Agreements and the Stemcor Shareholder Loan Agreement.
SMAPL	Shagang Mining (Australia) Pty Ltd ACN 124 436 335.
Sojitz	Sojitz Resources & Technology Pty Ltd (ABN 91 125 884 326).
Sojitz Joint Venture Agreement	the Joint Venture Implementation Agreement between Grange and Sojitz Australia Limited (ABN 16 000 213 132) on behalf of Sojitz.
Southdown Project	the Southdown Magnetite (Iron Ore) Project located near Albany in Western Australia (WA) in which Grange holds a controlling interest.
Stemcor Shareholder Loan Agreement	the loan agreement between Stemcor and SMAPL dated 16 August 2007.
Stemcor Shares	2,000,000 ordinary shares in SMAPL held by Stemcor at the date of this agreement.
Straddle Returns	is defined in clause 11.1.
Superior Proposal	a Proposal which is: on terms that are not less favourable to Grange than the Transaction; and 1 from a financial perspective, is superior for Grange compared to the 2 Transaction.
Тах	any tax, levy, charge, impost, fee, deduction, goods and services tax, or withholding, that is assessed, levied, imposed or collected by any Governmental Agency and includes any interest, fine, penalty, charge, fee or any other amount imposed on, or in respect of any of the above but excludes Duty.

$\bar{\gamma}$

Term	Meaning
Tax Act	means, as the context requires, the Income Tax Assessment Act 1997 and/or the Income Tax Assessment Act 1936 and, to the extent applicable, the Taxation Administration Act 1953.
Tax Claim	any claim, demand, legal proceedings or cause of action including, any claim, demand, legal proceedings or cause of action:
	based in contract (including breach of Warranty); 1
	based in tort (including misrepresentation or negligence); 2
	under common law; or 3
	under statute, 4
	arising from a breach of a Tax Warranty.
Tax Claim Amount	means:
	the amount Grange or a Transaction Entity (as applicable) is required to pay 1 in Tax to a Governmental Agency as a result of a Tax Demand (including any amount payable by reason of a self-assessment made by Grange or a Transaction Entity (as applicable)); and
	the amount of any credit, rebate, refund, right of set-off or right to repayment 2 of Tax denied to Grange or a Transaction Entity (as applicable) as a result of a Tax Demand.
Tax Cost	all costs, and expenses incurred in:
	managing an inquiry; or 1
	conducting any Disputing Action in relation to a Tax Demand, 2
	in relation to a Tax or Duty, but does not include a Tax or Duty.
Tax Demand	a Demand or assessment from a Governmental Agency requiring the 1 payment of any Tax or Duty for which the Sellers may be liable under this agreement;
	any document received from a Governmental Agency administering any Tax 2 or Duty assessing, imposing, claiming or indicating an intention to claim any Tax or Duty;
	a notice to a contributing member of a Consolidated Group given under 3 section 721-15(5) or (5A) of the ITAA 1997; or
	lodgement of a tax return or a request for an amendment under a law about 4 self-assessment of Tax.
Tax Indemnity	the indemnity provided in clause 8.6.
Tax Invoice	includes any document or record treated by the Commissioner of Taxation as a tax invoice or as a document entitling a recipient to an input tax credit.

$\hat{\boldsymbol{\beta}}$

Term	Meaning
Tax Law	any law relating to either Tax or Duty as the context requires.
Tax Payor	is defined in clause 10.3.
Tax Provision	the provision for current Tax in the Reference Date Balance Sheet.
Tax Warranty	the warranties at clauses 3.17 and 4.22 to 4.35 of Schedule 1.
Tax Year	means income year, tax year, franking year, and any part of such years, or any period of time relevant to Tax.
Third Party	any person or entity (including a Governmental Agency) other than a Seller Group Member, a Grange Group Member or a Transaction Entity.
Third Party Claim	any claim, Demand, legal proceedings or cause of action made or brought by a Third Party, other than a Tax Demand.
Transaction	the transactions contemplated under this agreement and the Merger Implementation Agreement. For the avoidance of doubt, this does not include the Pre-sale Transactions.
Transaction Agreements	this agreement, the Confidentiality Agreement and the Merger Implementation Agreement.
Transaction Entities	Ever Green and each of its subsidiaries which are, as at the date of this agreement: SMAPL: 1 Beviron Pty Ltd; and 2 Goldamere Pty Ltd, 3 and Transaction Entity means any of them.
Transaction Entities Accounts	in respect of each Transaction Entity the audited balance sheet of that Transaction Entity as at the Accounts Date and the audited profit and loss account of that Transaction Entity for the year ending on the Accounts Date.
Transaction Entities Business	the business carried out by the Transaction Entities.
Transaction Entity Material Adverse Change	a change to the business, financial or trading position or prospects of the Transaction Entities or the operations or assets of the Transaction Entities which occurs between 1 July 2008 and Completion that has, or is reasonably likely to have, a material adverse effect on any Transaction Entity, other than a change

Term	Meaning
	resulting from: financial market fluctuations, changes in interest rates and changes in tax, securities or other applicable laws; the Transaction Agreements or the Transaction; or 2 conditions affecting the iron ore industry, including changes affecting the 3 iron ore pellet price, concentrate price and chip price (but not changes in steel prices).
Warranties	the Individual Seller Warranties, the Ever Green Warranties and the Grange Warranties.

$1.3$ Interpretation provisions

In this agreement headings and words in bold are inserted for convenience and do not affect the interpretation of this agreement and unless the contrary intention appears:

a reference to this agreement or another instrument includes any variation or $(a)$ replacement of any of them;
$(b)$ a reference to a statute, ordinance, code or other law includes regulations and other instruments under it and consolidations, amendments, re-enactments or replacements of any of them;
$(c)$ the singular includes the plural and vice versa:
the word 'person' includes a firm, a body corporate, an unincorporated association or an $(d)$ authority;
$(e)$ a reference to a person includes a reference to the person's executors, administrators, successors, substitutes (including persons taking by novation) and assigns;
if a period of time is specified and dates from a given day or the day of an act or event, it $(f)$ is to be calculated exclusive of that day;
$(q)$ a reference to a day is to be interpreted as the period of time commencing at midnight and ending 24 hours later;
$(h)$ if an act prescribed under this agreement to be done by a party on or by a given day is done after 5.00pm on that day, it is taken to be done on the next day;
if an event must occur on a stipulated day that is not a Business Day then the stipulated $(i)$ day will be taken to be the next Business Day;
a reference to time is a reference to Perth time; $(i)$
$(k)$ a reference to any thing (including any amount) is a reference to the whole and each part of it and a reference to a group of persons is a reference to any one or more of them;
$(1)$ a reference to a part, clause, party, attachment, exhibit or schedule is a reference to a part and clause of, and a party, attachment, exhibit and schedule to, this agreement and a reference to this agreement includes any attachment, exhibit and schedule; and
$(m)$ a reference to \$ is to Australian currency unless denominated otherwise.

$1.4$ Inclusive expressions

Specifying anything in this agreement after the words 'including', 'includes' or 'for example' or similar expressions does not limit what else is included unless there is express wording to the contrary.

$1.5$ Obligations and rights of Sellers

Without limiting clause 9.1, in this agreement: $(a)$
each obligation of a Seller is several not joint; $(1)$
$(2)$ each right of the Sellers is held by each of them severally not jointly; and
except in such instances in which the context requires otherwise, any other $(3)$ reference to the Sellers is a reference to each of the Sellers separately and as to itself, so that (for example):
- $(A)$ a representation, warranty or undertaking given by the Sellers is given by each of the Sellers separately about itself or its Seller Group or its Sale Shares or the Transaction Entities (as the case may be); and
- $(B)$ a representation, warranty or undertaking given by the Sellers as to their knowledge or awareness is given by each Seller only as to its own knowledge or awareness of the fact, matter or circumstance and the knowledge or awareness of the fact, matter or circumstance that it would reasonably be expected to have if, on the date the representation, warranty or undertaking is given it had made all reasonable enquiries as to the accuracy of the representation, warranty or undertaking.
$(b)$ Except for Claims in respect of Warranties, which are dealt with in clause 9.1, if:
$(1)$ a right is conferred on more than one Seller; or
an obligation is imposed on more than one Seller; or $(2)$
$(3)$ a Claim is able to be made against more than one Seller.

that right is conferred on, obligation is imposed on, or Claim is to be made against, (as the case may be) the relevant Sellers severally and in the following proportions:

$(4)$ Shagang: 61.2%;
RI: 18%; $(5)$
PI: 10.8%; and $(6)$
$(7)$ Stemcor: 10%.

1.6 Authority to act

Each of RI, PI and Stemcor authorise Shagang, at Shagang's option, to act on behalf of $(a)$ RI. PI and Stemcor in respect of the obligations and rights under this agreement of any or all of the Sellers, in the name of and on behalf of each of RI, PI and Stemcor.
Shagang may act pursuant to clause 1.6(a): $(b)$
$(1)$ in the best interests of each Seller, acting reasonably; and
$(2)$ without consulting with or seeking the instructions of the other Sellers.
Any acts of Shagang pursuant to clause 1.6(a) binds (if acting on behalf of a Seller) the $(c)$ relevant Seller and (if acting on behalf of two or more Sellers) those other Sellers.
Each Seller acknowledges that Grange has entered into this agreement and the Merger $(d)$ Implementation Agreement on the reliance, without inquiry, that any action of Shagang pursuant to clause 1.6(a) is in accordance with any required authorisations, consents or instructions from the other Sellers.
$(e)$ Despite clause 1.6(a) each of the Sellers remains liable in respect of its obligations and rights under this agreement, including any obligation or right in respect of which Shagang acts on behalf of another Seller pursuant to clause 1.6(a), and nothing in clause 1.6(a) makes Shagang:
responsible for any failure by another Seller to perform its obligations under this $(1)$ agreement: or
$(2)$ liable in respect of any obligation of, or action required to be undertaken by. another Seller.
RI and PI indemnify Shagang against any Loss which Shagang pays, suffers, incurs or is $(f)$ liable for in respect of Shagang in acting on behalf of any or all of the other Sellers pursuant to clause 1.6(a), except to the extent attributable to Shagang's fraud, wilful misconduct or negligence.
Notwithstanding clause 1.6(b)(2), to the extent reasonably practicable, Shagang will $(q)$ consult with Stemcor prior to acting under clause 1.6(b) in relation to any material decisions.

Conditions Precedent 2

$2.1$ Conditions

Subject to this clause 2.1, clauses 3 and 7 do not become binding on the parties and are of no force or effect unless and until the following conditions precedent have been satisfied or waived in accordance with clause 2.3.

(Foreign Investment Review Board approval): $(a)$

$(1)$ Grange and the Sellers have each received a written notice under the FATA. by or on behalf of the Treasurer of the Commonwealth of Australia stating that

the Commonwealth Government does not object to the Transaction either unconditionally or on terms that do not impose unduly onerous obligations on Grange and the Sellers respectively;

$(2)$ the Treasurer of the Commonwealth of Australia becomes, or is, precluded from making an order in respect of the subject matter of the Transaction under the FATA: or
$(3)$ if an interim order is made under the FATA in respect of the Transaction, the subsequent period for making a final order prohibiting the Transaction elapses without a final order being made.
$(b)$ (People's Republic of China approvals): all regulatory approvals required in the People's Republic of China in order to carry out the Transaction.
(Independent Expert's Report): The directors of Grange commission an Independent $(c)$ Expert's Report and the Independent Expert's Report concludes that the Transaction is fair and reasonable to Grange's Shareholders.
$(d)$ (Shareholder approval): Grange Shareholders approve:
the Transaction by the necessary majority required by law and the Listing Rules $(1)$ at a meeting of Grange Shareholders (in accordance with any applicable Listing Rules and applicable law, including item 7 section 611 of the Corporations Act); and
$(2)$ the Off-Take Resolutions (if required under applicable laws (including the Corporations Act and Listing Rules)) by the necessary majority required by law and the Listing Rules at a meeting of Grange Shareholders (in accordance with any applicable Listing Rules and applicable law).
$(e)$ (Grange Material Adverse Change): There has been no Grange Material Adverse Change.
(Transaction Entity Material Adverse Change): There has been no Transaction Entity $(f)$ Material Adverse Change.
(Recommendation of Superior Proposal): No director of Grange recommends a $(g)$ Superior Proposal to Grange's Shareholders.
(Third Party Consents change of control of Grange): Grange obtains any consent $(h)$ which is required by a Third Party under a material contract to which a Grange Group Member is a party in a form reasonably satisfactory to the Sellers.
(Third party consents change of control): The Sellers obtain any consent to the $(i)$ Transaction which is required by a Third Party under a material contract to which a Seller Group Member or a Transaction Entity is a party in a form reasonably satisfactory to Grange.
$(i)$ (Tax ruling): The Sellers obtain a tax ruling from the Australian Tax Office in a form satisfactory to the Sellers in relation to roll-over relief implications of the Transaction.
(Merger Implementation Agreement): Shagang and Grange enter into the Merger $(k)$ Implementation Agreement.

$2.2$ Best endeavours

$(a)$ The parties must use their best endeavours to ensure that the conditions in clause 2.1 are satisfied as expeditiously as possible and in any event on or before the Cut Off Date.
$(b)$ The parties must keep each other informed of the progress towards satisfaction of the conditions.
$(c)$ Each party must cooperate with each other party in approaching the relevant regulatory bodies for the purposes of satisfying the conditions in clause 2.1.
$(d)$ Each party must provide all reasonable assistance to the other as is necessary to satisfy the conditions.
Each party must file all notices and applications which are required to be filed by that $(e)$ party for approval necessary to satisfy the conditions.
$(f)$ Each party must provide all information as may be reasonably requested by the other party in connection with any notices and applications for approval.

$2.3$ Waiver of conditions precedent

The conditions in clauses $2.1(a)$ , $2.1(b)$ , $2.1(h)$ and $2.1(k)$ are for the joint benefit of the $(a)$ Sellers and Grange and may only be waived by written agreement between the Sellers and Grange.
$(b)$ The conditions in clauses $2.1(d)(2)$ , $2.1(e)$ , $2.1(g)$ and $2.1(j)$ are for the benefit of the Sellers and may only be waived by written agreement of the Sellers.
The conditions in clauses $2.1(c)$ , $2.1(d)(1)$ , $2.1(f)$ , and $2.1(i)$ are for the benefit of Grange $(c)$ and may only be waived by Grange.
If a party or parties (as the case may be) waive the breach or non-fulfilment of any $(d)$ condition precedent in clause 2.1, that waiver does not prevent it or them (as the case may be) from suing the other parties or party (as the case may be) for any breach of this agreement that resulted in the breach or non-fulfilment of the condition precedent.

$2.4$ Consultation on failure of condition precedent

$(a)$ (Consultation): If any event occurs which would prevent any of the conditions precedent in clause 2.1 being satisfied, or there is an occurrence that is reasonably likely to prevent the condition precedent being satisfied by the Cut Off Date, the parties must consult in good faith to:
determine whether the Transaction may proceed by way of alternative means $(1)$ or methods: or
$(2)$ extend the Cut Off Date.
(Termination): If the parties are unable to reach agreement under clause 2.4(a) within $(b)$ 10 Business Days of becoming aware of the relevant occurrence or relevant date, then unless that condition precedent is waived by the relevant party or parties as provided in clause 2.3, any party may terminate this agreement without any liability to any other party because of that termination, unless the relevant occurrence or the failure of the condition

precedent to be satisfied arises out of a breach by the terminating party or parties of this clause 2.4.

$2.5$ Certain notices

(Notice of failure of condition precedent): $(a)$

$(1)$ If, before the time specified for satisfaction of a condition precedent, any event that will prevent any of the conditions precedent in clause 2.1 being satisfied occurs, the party with knowledge of that event must immediately give the other parties written notice of that event.
$(2)$ A party must give written notice to the other parties as soon as possible (and in any event no later than 5 Business Days) after giving or receiving notice of the relevant event, as to whether or not it waives the breach or non-fulfilment of any condition precedent resulting from the occurrence of that event, specifying the condition in question.
$(b)$ (Waiver): A waiver of a breach or non-fulfilment in respect of one condition precedent does not constitute:
$(1)$ a waiver of breach or non-fulfilment of any other condition precedent resulting from the same event; or
$(2)$ a waiver of breach or non-fulfilment of that condition precedent resulting from any other event.
(Notice of changes): Each party must promptly advise each other party orally and in $(c)$ writing of any change or event causing, or which, so far as can reasonably be foreseen. would cause:
$(1)$ a representation or warranty provided in this agreement to be false;
$(2)$ a breach or non-fulfilment of any of the conditions precedent; or
$(3)$ a material breach of this agreement.

$2.6$ Cut Off Date

A party may, by not less than 2 Business Days' notice to the other parties, terminate this agreement at any time before Completion if:

the conditions in clause 2.1 are not satisfied, or waived in accordance with clause 2.3, by $(a)$ the Cut Off Date; or
the conditions in clause 2.1 become incapable of satisfaction or the parties agree that any $(b)$ of the conditions in clause 2.1 cannot be satisfied.

$2.7$ No binding agreement for transfer

For the avoidance of doubt, nothing in this agreement will cause a binding agreement for the transfer or issue of shares to arise unless and until the conditions in clause 2.1 have been satisfied or waived in accordance with clause 2.3 and no person will obtain rights in

relation to shares as a result of this agreement unless and until those conditions have been satisfied.

3 Sale and purchase

$3.1$ Sale Shares

On the day for Completion determined under clause 7.1:

$(1)$ Stemcor must sell, and Grange must buy, the Stemcor Shares free and clear of all Encumbrances;
$(2)$ Stemcor must assign to Grange, and Grange must accept the assignment of, the Stemcor Shareholder Loan Agreement;
the Ever Green Sellers must sell, and Grange must buy, the Ever Green Sale $(3)$ Shares free and clear of all Encumbrances; and
$(4)$ the Ever Green Sellers must assign to Grange, and Grange must accept the assignment of, the Ever Green Shareholder Loan Agreements,

for the Consideration.

$3.2$ Associated Rights

$(1)$ Stemcor must sell the Stemcor Sale Shares;
$(2)$ Shagang must sell the Shagang Sale Shares;
$(3)$ RI must sell the RI Sale Shares: and
$(4)$ PI must sell the PI Sale Shares:

to Grange together with all rights:

$(5)$ attached to them as at the date of this agreement; and
$(6)$ that accrue between the date of this agreement and Completion.

$3.3$ Title and risk

Title to and risk in the Stemcor Shares passes to Grange on completion of the step described in clause 3.1(1) and title to and risk in the Ever Green Sale Shares passes to Grange on completion of the step described in clause 3.1(3).

Consideration Shares $3.4$

The Consideration Shares to be issued to the Sellers in the following proportions:

$(a)$ Shagang - 232,575,639 Consideration Shares;

$(b)$ RI-68,404,600 Consideration Shares;
PI-41.042.760 Consideration Shares; and $(c)$
$(d)$ Stemcor - 38,002,555 Consideration Shares. will:
$(1)$ be issued as fully paid;
be free of Encumbrances: $(2)$
$(3)$ rank equally in all respects with the other ordinary shares on issue in the capital of Grange as at the date of Completion.

Period before Completion $\overline{4}$

$4.1$ Access for Grange

$(a)$ Subject to clause 4.1(b), during the period between the date of this agreement up to the earlier of Completion and termination of this agreement, the Sellers must ensure that Grange and a reasonable number of persons authorised by Grange:
$(1)$ are given reasonable, non-disruptive access during normal business hours and on reasonable notice, to employees, offices and other facilities, and to the books and records, of the Transaction Entities; and
$(2)$ have reasonable access to senior management of the Transaction Entities,

for the purpose of implementing the Transaction.

$(b)$ Grange must ensure that any persons provided with the access referred to in clause 4.1(a) comply with the reasonable requirements of the Sellers or any relevant third party in respect of the access and do not interfere with the business or operations of the Sellers.

$4.2$ Access for Shagang

Subject to clause 4.2(b) and any confidentiality obligation of Grange under any $(a)$ agreement or arrangement with any Third Party, during the period between the date of this agreement up to the earlier of Completion and termination of this agreement, Grange must ensure that Shagang and a reasonable number of persons nominated by Shagang and authorised by Grange:
$(1)$ are given reasonable, non-disruptive access during normal business hours and on reasonable notice, to employees, offices and other facilities, and to the books and records, of Grange and its subsidiaries; and
$(2)$ have reasonable access to senior management of Grange and its subsidiaries,

for the purpose of implementing the Transaction.

$(b)$ Shagang must ensure that any persons provided with the access referred to in clause 4.2(a) comply with the reasonable requirements of Grange or any relevant third party in respect of the access and do not interfere with the business or operations of Grange.

4.3 Carrying on of Transaction Entities Business

Subject to clause 4.5, between the date of this agreement and the earlier of Completion $(a)$ and termination of this agreement, the Sellers must use reasonable endeavours to ensure that the Transaction Entities Business is conducted materially in the ordinary course and, in particular, that no Transaction Entity:
$(1)$ issues any shares, options or securities that are convertible into shares in that Transaction Entity:
$(2)$ pays or declares any dividends or makes any other distributions of their profits (except for any Approved Payments or extraordinary budgeted expenses related to normal operations);
$(3)$ engages in any capital reorganisation;
$(4)$ enters into, terminates or varies a material or unusual contract;
changes any senior executive arrangements: $(5)$
$(6)$ sells or acquires any material assets;
$(7)$ repays any Shareholder Loan Agreements;
$(8)$ incurs any unusual debt;
$(9)$ alters its constitution:
buys back or redeems any shares or otherwise reduces its share capital or $(10)$ provides financial assistance for the acquisition of its own shares or shares in its holding company;
$(11)$ disposes of or creates any Encumbrance over, or declares itself the trustee of. any material asset (including the Existing Tenements) except in the ordinary course of business;
$(12)$ incurs or enters into commitments to incur capital expenditure in excess of \$1,000,000 above the level of capital expenditure disclosed in the capital expenditure budget contained in the Sellers Disclosure Materials;
does or omits to do anything which might result in the variation, termination, $(13)$ revocation or non-renewal of any Authorisation held by a Transaction Entity which is material to the operation of the Transaction Entities Business:
incurs any indebtedness exceeding \$5,000,000, excluding the following: $(14)$
- $(A)$ borrowing under its existing bank facilities;
- $(B)$ the conversion to a loan of any outstanding obligation to repay all or part of the balance owing to Evergain International Corporation (Evergain) in respect of a prepayment by Evergain for iron ore pellet

shipments which balance was stated as A\$21,237,186 as of 30 June 2008; and

$(C)$ margin calls relating to foreign exchange hedging activities undertaken by the Transaction Entities fully and fairly disclosed to Grange as part of the Sellers Disclosure Materials.

of which clauses $4.3(a)(14)(B)$ and (C) will not be undertaken without reasonable consultation with Grange;

$(15)$ exceeds any limitation on indebtedness imposed by, or breaches any other material covenant given in favour of, any lender or other financier to a Transaction Entity;
$(16)$ enters into any new bank facilities or other financial accommodation except in the ordinary course of business:
$(17)$ enters into any Guarantee or indemnity on behalf of any person or provide security for the obligations of any person;
$(18)$ enters into any profit sharing or profit or equity participation arrangement with any employee, agent, distributor, representative, director or other person,;
$(19)$ revalues any of its assets, except as required under the Accounting Standards or any other accounting policy applicable to the Transaction Entities or for stamp duty purposes;
$(20)$ changes any accounting policies or practices unless such change is required by law:
$(21)$ does or omits to do anything which may place any of the mining tenements or exploration licences held by it in jeopardy or render them liable to cancellation or failure:
$(22)$ terminates or permits the termination or amendment of, or fails to renew on its expiry, any insurance policy held by that Transaction Entity as at the date of this agreement: or
$(23)$ authorises, or agree conditionally or otherwise to do, any of the things referred to in this clause 4.3.
The Sellers must promptly notify Grange of any abnormal or unusual events with respect $(b)$ to the Transaction Entities Business or the occurrence of any event outside the ordinary course of business.

4.4 Carrying on of Grange Group Business

$(a)$ Subject to clause 4.5, between the date of this agreement and the earlier of the date of Completion and termination of this agreement, Grange must ensure that its business and the business of its subsidiaries is conducted materially in the ordinary course and, in particular Grange must not and must procure that its subsidiaries do not:
$(1)$ issue any shares, options or securities that are convertible into shares in any Grange Group Member; pay or declare any dividends or makes any other distributions of their profits:
$(2)$ engage in any capital reorganisation;
$(3)$ enter into material or unusual contracts (including but not limited to joint venture agreements and off take agreements);
$(4)$ change any senior executive arrangements:
$(5)$ sell or acquire any material assets (other than the disposal of 30% of its interest in Exploration Licence 70/2512 to Sojitz in accordance with the Sojitz Joint Venture Agreement);
$(6)$ incur any unusual debt;
alter its constitution; $(7)$
$(8)$ incur any capital or operational expenditure in a manner inconsistent with the budgets and plans provided as part of the Grange Disclosure Materials;
delay or suspend any internal, environmental and governmental approval $(9)$ procedures; or
does or omits to do anything which may place any of the mining tenements or $(10)$ exploration licences held by it in jeopardy or render them liable to cancellation or failure.
Grange must promptly notify the Sellers of any abnormal or unusual events with respect $(b)$ to its business or the business of its subsidiaries or the occurrence of any event outside the ordinary course of business.

4.5 Permitted acts

Nothing in clause 4.3 restricts the Sellers or any Transaction Entity from doing anything: $(a)$
$(1)$ that is permitted in any Transaction Agreement or required in order to carry out the Transaction (provided that Grange is aware of the matter prior to the date of this agreement): or
$(2)$ approved by Grange, such approval not to be unreasonably withheld or delayed.
$(b)$ Nothing in clause 4.4 restricts Grange from doing anything:
$(1)$ that is permitted in any Transaction Agreement or required in order to carry out the Transaction (provided that Shagang is aware of the matter prior to the date of this agreement); or
$(2)$ approved by Shagang, such approval not to be unreasonably withheld or delaved.

$4.6$ Locked Box

The Sellers must ensure that, in respect of the period between 1 July 2008 and the $(a)$ Completion Date:

$(1)$ the working capital reflected in the Reference Date Balance Sheet, including cash generated by the Transaction Entities Business, has been and is retained within that Transaction Entities Business (and no dividends or distributions are made by the Transaction Entities Business other than the Approved Payments);
$(2)$ liabilities of the Transaction Entities Business have been and are met through the earnings of that Transaction Entities Business and have been and are not materially increased beyond the liabilities reflected in the Reference Date Balance Sheet (except as a result of the BNP Paribas Facility Drawdown or foreign exchange hedging activities undertaken by the Transaction Entities fully and fairly disclosed to Grange as part of the Sellers Disclosure Materials): and
$(3)$ all the material assets of the Transaction Entities Business reflected in the Reference Date Balance Sheet have been and are retained within the Transaction Entities Business.
$(b)$ If the Sellers become aware that any transaction has taken place that is inconsistent with clause $4.6(a)$ :
the Sellers must inform the other parties as soon as practicable; $(1)$
$(2)$ the parties must determine the optimal method of reversing the effect of the transaction: and
$(3)$ the parties must give effect to the determination.

$4.7$ Parent Guarantees

$(a)$ Before Completion the Sellers and Grange must take all reasonable steps to ensure that, effective from Completion, each Seller Group Member is released from any actual, contingent liabilities under a Parent Guarantee given by it in respect of any liabilities that arise out of any acts or omissions that take place after Completion. For the purposes of this clause 4.7, 'reasonable steps' includes Grange or (at the request of the relevant third party) another Grange Group Member providing the relevant third party with a replacement quarantee or security on terms reasonably acceptable to Grange.
$(b)$ For the avoidance of doubt, this clause 4.7 does not oblige Grange to take any steps in respect of any liabilities that accrue under a Parent Guarantee in relation to any period prior to Completion.

Seller Obligations 4.8

The Sellers must:

$(a)$ as soon as practicable after the date of this agreement, prepare and provide to Grange, for inclusion in the Grange NOM, the Seller Information in a form and to the level of detail reasonably required by Grange (giving consideration to any applicable laws and the Listing Rules); and
$(b)$ give all necessary assistance which Grange may reasonably require to implement the Transaction as soon as reasonably practicable.

4.9 Savage River SPA Consideration

Grange acknowledges and agrees that the Consideration to be paid by Grange has been $(a)$ discounted for the value of the Outstanding Savage River Payments owed by the Transaction Entities and the Outstanding Savage River Payments will be funded by SMAPL.
To the extent that Shagang or any of its Related Bodies Corporates are required to pay $(b)$ any part of the Outstanding Savage River Payments that are properly due and payable by SMAPL without dispute solely due to the default of SMAPL of its payment obligations under the Savage River Sale and Purchase Agreement. Grange will indemnify Shagang or its relevant Related Body Corporate to the extent of any such payment that is made.

5 Termination

$5.1$ Termination by Grange

Subject to clause 5.5 Grange may terminate this agreement at any time before Completion by notice in writing to the Sellers if the Sellers are in breach (including any breach of the Individual Seller Warranties or Ever Green Warranties), in any material respect, of any of their obligations under this agreement, and that breach is not remedied within 5 Business Days of being informed in writing of the breach.

$5.2$ Termination by the Sellers

Subject to clause 5.5 the Sellers may terminate this agreement at any time before Completion by notice in writing to Grange and the other Sellers if Grange is in breach (including any breach of the Grange Warranties), in any material respect, of any of its obligations under this agreement, and that breach is not remedied within 5 Business Days of being informed in writing of the breach.

5.3 Automatic termination

This agreement terminates immediately upon the Merger Implementation Agreement being terminated in accordance with its terms.

$5.4$ Effect of termination

If this agreement is terminated under clause 2.4(b), 2.6 or this clause 5, then:

the parties will procure that each Transaction Agreement (if permitted by the terms of that $(a)$ contract) that has already been executed is terminated in accordance with its terms;
each party is released from its obligations to further perform its obligations under the $(b)$ Transaction Agreements, except those expressed to survive termination;
each party retains the rights it has against the other in respect of any breach of this $(c)$ agreement occurring before termination;
$(d)$ each party must return to the other party all documents and other materials obtained from the other party in accordance with the terms of the Confidentiality Agreement; and
$(e)$ the rights and obligations of each party under each of the following clauses and schedules will continue independently from the other obligations of the parties and survive termination of this agreement:
$(1)$ clause 1 (Definitions and Interpretation):
clause 5 (Termination); $(2)$
clauses 8 (Warranties and Indemnities), 9 (Qualifications and limitations on $(3)$ Claims) and 10 (Procedures for dealing with Claims);
$(4)$ clause 12 (GST);
clause 16 (Duty, costs and expenses); $(5)$
$(6)$ clause 17 (Confidentiality); and
clause 18 (General). $(7)$

5.5 No other right to terminate or rescind

No party may terminate or rescind this agreement (including on the grounds of any breach of Warranty or misrepresentation that occurs or becomes apparent before Completion) except as permitted under clause 2.4(b), 2.6 or this clause 5.

Pre-Completion actions 6

$6.1$ Board resolutions

On or before Completion the Sellers must ensure that a meeting of the directors of each Transaction Entity is convened and approves (subject to Completion occurring):

$(a)$ the:
registration of Grange as the holder of the Sale Shares in its register of $(1)$ shareholders; and
$(2)$ issue of new share certificates for the Sale Shares in the name of Grange,

subject only to receipt of the executed share transfers referred to in clause 7.3(a)(2) and to payment of any Duty on the transfer of Sale Shares; and

$(b)$ the assignment of the Shareholder Loan Agreements from the Sellers to Grange, subject only to execution of the documents referred to in clauses 7.3(a)(3) and 7.4(f) and to payment of any Duty on the assignment of the Shareholder Loan Agreements; and
in the case of Ever Green, the resignation of the existing directors of Ever Green and $(c)$ appointment of new directors of Ever Green as agreed by Grange and Shagang at least 10 Business Days prior to Completion.

$\overline{7}$ Completion

Time and Place $7.1$

Subject to clause 4.8, Completion must take place in Perth at the office of Freehills at 9.00am on the day that is 5 Business Days after satisfaction or waiver of the last of the conditions in clause 2.1, or such other place, time and date as the Sellers and Grange agree.

$7.2$ Completion

On or before Completion, each party must carry out the steps referable to it in clauses 7.3 $(a)$ and 7.4.
$(b)$ Completion is taken to have occurred when each party has performed all of its obligations under this clause 7.

$7.3$ Sellers' obligations at Completion

$(a)$ At Completion, the Sellers must give Grange the following documents:
(share certificates) share certificates for the Sale Shares and any other $(1)$ documents necessary to establish Grange's title to the Sale Shares and that may be required by a Transaction Entity for registration of the transfer of the Sale Shares to Grange:
(share transfers) completed share transfers of the Sale Shares to Grange, $(2)$ executed by or on behalf of the Sellers; and
(assignment of Shareholder Loan Agreement) the deeds of assignment and $(3)$ any other documents necessary to effect the assignment of the Shareholder Loan Agreement from the Sellers to Grange, duly executed by the Sellers.
$(b)$ At Completion, the Sellers must make available to Grange:
(corporate documents) the certificate of incorporation, common seal, $(1)$ duplicate seal, all prescribed registers, all statutory, minute and other Business Records of each Transaction Entity and all unused share certificate forms;
(books and ledgers) all ledgers, journals and books of account of each $(2)$ Transaction Entity;
(cheque books) all cheque books of each Transaction Entity and a list of all $(3)$ bank accounts maintained by each Transaction Entity in its name; and
$(4)$ (title documents) all documents of title in the possession of a Transaction Entity relating to the ownership of a Transaction Entity's assets.

$7.4$ Grange's obligations at Completion

At Completion Grange must:

$(a)$ issue the Consideration Shares to the Sellers;
$(b)$ apply to ASX for quotation of the Consideration Shares in accordance with the Listing Rules within 2 Business Days of Completion;
deliver to the Sellers a draft of the Cleansing Statement to be lodged with ASX within 5 $(c)$ Business Days of the issue of the Consideration Shares to the Sellers in accordance with section 708A(5) of the Corporations Act in relation to the issue of the Consideration Shares or, if Grange is unable to comply with each of the obligations required to issue a Cleansing Statement, a draft of the disclosure document complying with part 6D.2 of the Corporations Act to be lodged within 5 Business Days of Completion;
deliver to the Sellers a holding statement in respect of the Consideration Shares; $(d)$
$(e)$ execute and deliver for registration the share transfers of the Sale Shares; and
accept the assignment of the Shareholder Loan Agreements by duly executing the $(f)$ necessary documents to effect the assignment of the Shareholder Loan Agreements from the Sellers to Grange.

7.5 Notice to complete

If a party (Defaulting Party) fails to satisfy its obligations under clauses 7.2, 7.3 and 7.4 $(a)$ on the day and at the place and time for Completion determined under clause 7.1 then the other party (Notifying Party) may give the Defaulting Party a notice requiring the Defaulting Party to satisfy those obligations within a period of 10 Business Days from the date of the notice and declaring time to be of the essence.
If the Defaulting Party fails to satisfy those obligations within those 10 Business Days the $(b)$ Notifying Party may, without limitation to any other rights it may have, terminate this agreement by giving written notice to the Defaulting Party.

7.6 Completion simultaneous

Subject to clauses 7.6(b) and 7.6(c), the actions to take place as contemplated by this $(a)$ clause 7 are interdependent and must take place, as nearly as possible, simultaneously. If one action does not take place, then without prejudice to any rights available to any party as a consequence:
there is no obligation on any party to undertake or perform any of the other $(1)$ actions:
to the extent that such actions have already been undertaken, the parties must $(2)$ do everything reasonably required to reverse those actions; and
$(3)$ the Sellers and Grange must each return all documents delivered to it under clause 6 and this clause 7 to the party which provided the documents and must each repay payments received by it under this clause 7 to the party which made the payments, without prejudice to any other rights any party may have in respect of that failure.
Grange may, in its sole discretion, waive any or all of the actions that the Sellers are $(b)$ required to perform under clause 7.3 and the Sellers may, in their sole discretion, waive any or all of the actions that Grange is required to perform under clause 7.4.

$(c)$ Notwithstanding this clause 7.6, the parties acknowledge that the registration of the transfer of the Stemcor Shares will take place before the registration of the transfer of the Ever Green Sale Shares.

$7.7$ Post Completion actions

Immediately following Completion Grange and the Sellers must procure that:

forms referred to in this clause 7 are lodged with the appropriate Governmental Agency: $(a)$ and
$(b)$ . relevant ASIC forms are lodged to reflect the actions taken under this clause 7.

Warranties and Indemnities 8

$8.1$ Warranties by the Sellers and Ever Green Sellers

Subject to the qualifications and limitations in clause 8.5(d):

$(1)$ each Seller separately gives the Individual Seller Warranties in favour of Grange; and
$(2)$ the Ever Green Sellers give the Ever Green Warranties in favour of Grange:

and:

in respect of each Warranty that is expressed to be given on a particular date, $(3)$ on that date; and
$(4)$ in respect of each other Warranty, on the date of this agreement and immediately before Completion.

$8.2$ Warranties by Grange

Subject to the qualifications and limitations in clause 8.5(d). Grange gives the Grange Warranties in favour of the Sellers:

$(1)$ in respect of each Warranty that is expressed to be given on a particular date, on that date; and
$(2)$ in respect of each other Warranty, on the date of this agreement and immediately before Completion.

8.3 Independent Warranties

Each of the Warranties is to be construed independently of the others and is not limited by reference to any other Warranty.

8.4 Reliance

The Sellers acknowledge that Grange has entered into this agreement and will complete $(a)$ this agreement in reliance on the Individual Seller Warranties.
The Ever Green Sellers acknowledge that Grange has entered into this agreement and $(b)$ will complete this agreement in reliance on the Ever Green Warranties.
$(c)$ Grange acknowledges that the Sellers have entered into this agreement and will complete this agreement in reliance on the Grange Warranties.

8.5 Indemnity for breach of Warranty

The Sellers indemnify Grange against any Loss suffered or incurred by Grange as a $(a)$ result of a breach of an Individual Seller Warranty, except to the extent that the Warranty or the Sellers' liability for the Loss are limited or qualified under clause 9 (including, without limitation, clause 9.1(a)), and this will be the sole remedy of Grange in respect of any such breach.
$(b)$ The Ever Green Sellers indemnify Grange against any Loss suffered or incurred by Grange as a result of a breach of an Ever Green Warranty (other than a Tax Warranty), except to the extent that the Warranty or the Ever Green Sellers' liability for the Loss are limited or qualified under clause 9 (including, without limitation, clause 9.1(b)), and this will be the sole remedy of Grange in respect of any such breach.
$(c)$ Grange indemnifies the Sellers against any Loss suffered or incurred by the Sellers as a result of a breach of a Grange Warranty, except to the extent that the Warranty or Grange's liability for the Loss is limited or qualified under clause 9, and this will be the sole remedy of the Sellers in respect of any such breach.
Any amount payable by Grange to the Sellers under this clause 8 will be payable in the $(d)$ following proportions:
$(1)$ Shagang $-61.2\%$ ;
$(2)$ $RI - 18%$
$PI 10.8\%$ $(3)$
Stemcor-10%. $(4)$

Ever Green Sellers' Tax Indemnity 8.6

Subject to clause $8.6(b)$ , the Ever Green Sellers agree that if at any time (whether before $(a)$ or after the Completion Date) any Transaction Entity, the Sellers or Grange receives, suffers or is affected by a Tax Demand as a direct result of which:
$(1)$ the Transaction Entities or Grange is liable to make a payment in respect of any Tax:
- $(A)$ on or in respect of or calculated by reference to any assessable income derived by the Transaction Entity (determined on the assumption that the Transaction Entity is not a member of a tax

consolidated group) with respect to any period up to and including the Completion Date; or

$(B)$ in respect of any act, transaction, event, matter or thing referable to a time prior to or to any period ending on or before the Completion Date in connection with the Transaction Entity or its activities; or
$(2)$ the Transaction Entities or Grange:
$(A)$ are deprived of any relief, allowance, credit, rebate, deduction, loss carry forward, refund, right of set off or right to repayment of Tax, claimed or obtained at any time up until the Completion Date; or
are required to make an adverse cost base adjustment in respect of $(B)$ assets within the Transaction Entities with respect to any period up to and including the Completion Date,

then if and to the extent that the Tax Claim Amount in respect of that Tax Demand is not the subject of a Tax Provision the Ever Green Sellers and Grange agree a Tax Claim Amount which the Ever Green Sellers must pay to Grange and the Ever Green Sellers must pay that agreed Tax Claim Amount to Grange in accordance with clause 10.3. If the parties cannot agree on any amount to be paid under the Tax Indemnity, clause 10.3(f) will apply.

$(b)$ The Tax Indemnity does not extend to any Tax payable in relation to any of the Transaction Entities ceasing to be members of the Australian Consolidated Group (as that term is defined in Schedule 1).

8.7 Survival of representations

Each Warranty:

$(a)$ is severable;
$(b)$ survives the termination of this agreement; and
is given with the intention that liability under it is not confined to breaches which are $(c)$ discovered before the date of termination of this agreement.

8.8 Survival of indemnities

Each indemnity in this agreement:

$(a)$ is severable;
$(b)$ is a continuing obligation;
constitutes a separate and independent obligation of the party giving the indemnity from $(c)$ any other obligations of that party under this agreement; and
survives the termination of this agreement. $(d)$

Qualifications and limitations on Claims 9

$9.1$ Sellers' and Ever Green Sellers' liability

$(a)$ Each Seller gives the Individual Seller Warranties separately in respect of itself, its Seller Group Members and its Sale Shares. No other Seller is liable under a Claim for any Individual Seller Warranty given by another Seller.
The Ever Green Sellers are severally liable under a Claim in respect of the Ever Green $(b)$ Warranties in the following proportions:
$(1)$ Shagang: 68%;
$(2)$ RI: 20%; and
PI: 12%. $(3)$

$9.2$ Interpretation

In clauses 9.3 to 9.14 and clause 10:

Warrantee means the party (or parties) to whom a Warranty has been given; $(a)$
Warrantor means the party (or parties) who have given a Warranty; $(b)$
$(c)$ Relevant Warranties means the Warranties given by the Warrantor;
Warrantee Group means the Seller Group or Grange Group (as the case may be) of the $(d)$ Warrantee and Warrantee Group Members means any one of them;
Warrantor Group means the Seller Group or Grange Group (as the case may be) of the $(e)$ Warrantor and Warrantor Group Members means any one of them;
$(f)$ Warrantor Disclosure Materials means (where the Warrantor is the Sellers or Ever Green Sellers) the Sellers Disclosure Materials and (where the Warrantor is Grange) the Grange Disclosure Materials;
Warrantor Business means (where the Warrantor is the Sellers or Ever Green Sellers) $(g)$ the Transaction Entities Business and (where the Warrantor is Grange) the Grange Group Business; and
Warrantor Accounts means (where the Warrantor is the Sellers or Ever Green Sellers) $(h)$ the Transaction Entities Accounts and (where the Warrantor is Grange) the Grange Group Accounts.

Disclosure 9.3

The Warrantee acknowledges and agrees that the Warrantor has disclosed or is deemed $(a)$ to have disclosed against the Relevant Warranties, and the Warrantee is aware of, and will be treated as having actual knowledge of, all facts, matters and circumstances that:
$(1)$ are provided for or described in a Transaction Agreement;
$(2)$ are fairly disclosed in, or otherwise evident from the information contained in, the Warrantor Disclosure Materials:
$(3)$ are disclosed on any public record (including any records maintained by any Governmental Agency or judicial or administrative body that are available for inspection by the public); or
$(4)$ are within the actual knowledge of a Warrantee Group Member or its advisers in relation to the Transaction.
$(b)$ The Warranties (other than the Tax Warranties) are given subject to the disclosures or deemed disclosures described in clause 9.3(a). The Warrantor will have no liability under the Relevant Warranties (other than the Tax Warranties) to the extent that disclosure is made or is deemed to have been made against the Relevant Warranties under this clause 9.3.
$(c)$ The Warrantee must not make a Claim (other than a Tax Claim), and it shall not be a breach of Warranty (other than a Tax Warranty), if the facts, matters or circumstances giving rise to such Claim are disclosed or are deemed to have been disclosed under clause $9.3(a)$ .

No reliance 9.4

The Warrantee acknowledges, and represents and warrants to each Warrantor Group Member. that:

$(a)$ at no time has:
any Warrantor Group Member or any person on its behalf, made or given; or $(1)$
$(2)$ any Warrantee Group Member relied on,

any representation, warranty, promise or undertaking in respect of the future financial performance of prospects of (if the Warrantor is the Sellers or Ever Green Sellers) the Transaction Entities or (if the Warrantor is Grange) the Grange Group Members or otherwise except those expressly set out in this agreement (including in the Relevant Warranties):

$(b)$ no representations, warranties, promises, undertakings, statements or conduct:
$(1)$ have induced or influenced the Warrantee to enter into, or agree to any terms or conditions of, this agreement;
$(2)$ have been relied on in any way as being accurate by a Warrantee Group Member:
$(3)$ have been warranted to a Warrantee Group Member as being true; or
$(4)$ have been taken into account by the Warrantee as being important to its decision to enter into, or agree to any or all of the terms of, this agreement,

except those expressly set out in this agreement (including in the Relevant Warranties);

it has entered into this agreement after satisfactory inspection and investigation of the $(c)$ affairs of (if the Warrantor is the Sellers or Ever Green Sellers) the Transaction Entities or (if the Warrantor is Grange) the Grange Group Members, including a detailed review of all the Warrantor Disclosure Materials: and

$(d)$ it has made, and it relies upon, its own searches, investigations, enquiries and evaluations in respect of the Warrantor Business, except to the extent expressly set out in this agreement (including in the Relevant Warranties).

9.5 Opinions, estimates and forecasts

The parties acknowledge that no Warrantor Group Member is under any obligation to provide any Warrantee Group Member or its advisers with any information on the future financial performance or prospects of (if the Warrantor is the Sellers or Ever Green Sellers) the Transaction Entities or (if the Warrantor is Grange) the Grange Group Members, If a Warrantee Group Member has received opinions, estimates, projections, business plans, budget information or other forecasts in respect of (if the Warrantor is the Sellers or Ever Green Sellers) the Transaction Entities or (if the Warrantor is Grange) the Grange Group Members, the Warrantee acknowledges and agrees that:

there are uncertainties inherent in attempting to make these estimates, projections, $(a)$ business plans, budgets and forecasts and the Warrantee is familiar with these uncertainties:
$(b)$ the Warrantee is taking full responsibility for making its own evaluation of the adequacy and accuracy of all estimates, projections, business plans, budgets and forecasts furnished to it; and
$(c)$ the Warrantor is not liable under any Claim arising out of or relating to any opinions, estimates, projections, business plans, budgets or forecasts in respect of (if the Warrantor is the Sellers or Ever Green Sellers) the Transaction Entities or (if the Warrantor is Grange) the Grange Group Members.

9.6 Maximum and minimum amounts

$(a)$ A Warrantor is not liable under a Claim (other than a Tax Claim) unless the amount finally agreed or adjudicated to be payable in respect of that Claim:
$(1)$ exceeds \$1,000,000; and
either alone or together with the amount finally agreed or adjudicated to be $(2)$ payable in respect of other Claims exceeds \$17,000,000.

in which event, subject to clauses $9.6(b)$ and $9.6(c)$ , the Warrantor is liable for all of that amount.

$(b)$ The maximum aggregate amount that the Warrantor is required to pay in respect of all Claims (in respect of the Relevant Warranties) whenever made is limited to the \$435,000,000.
For the purposes of clause $9.6(a)(1)$ : $(c)$
Claims arising out of separate sets of facts, matters or circumstances will not $(1)$ be treated as one Claim, even if each set of facts, matters or circumstances may be a breach of the same Warranty; and
$(2)$ Claims of the same or similar nature arising out of the same or similar facts, matters and circumstances will be treated as one Claim.

Time limits 9.7

A Warrantor is not liable under a Claim if:

the Warrantee does not notify the Warrantor of the Claim in accordance with clause $(a)$ 10.1(a) within:
5 years after Completion in the case of a Tax Claim; or $(1)$
$(2)$ 12 months after Completion in all other cases; and
within 6 months (or such longer period as may be agreed) of the date the Warrantee is $(b)$ required to notify the Warrantor of the Claim under clause 10.1(a):
the Claim has not been agreed, compromised or settled; and $(1)$
$(2)$ the Warrantee has not issued or served legal proceedings against the Warrantor in respect of the Claim.

9.8 Recovery under other rights and reimbursement

A Warrantor is not liable under a Claim for any Loss that a Warrantee Group Member or $(a)$ (only in the case where the Warrantor is the Sellers or Ever Green Sellers) a Transaction Entity is, or would be but for this clause 9.8, entitled to recover, or be compensated for by any other means, from another source whether by way of contract, indemnity or otherwise (including under a policy of insurance or from a Governmental Agency). In this clause 9.8 reference to entitlement to recover under a policy of insurance includes an entitlement that would have existed but for any change in the terms of insurance since Completion. Warrantee must notify its insurers of this clause 9.8.
$(b)$ If, after a Warrantor has made a payment in respect of a Claim, a Warrantee Group Member or (only in the case where the Warrantor is the Sellers or Ever Green Sellers) a Transaction Entity recovers or is compensated for by any other means, any Loss that gave rise to the Claim, the Warrantee must immediately pay to the Warrantor in Immediately Available Funds the lesser of:
$(1)$ the amount of the Loss that was recovered or compensated for; and
$(2)$ the amount paid by the Warrantor in respect of the Claim.

less any Tax payable by the Warrantee on that amount net of any deduction or offset allowable in respect of the payment to the Warrantor.

9.9 No double claims

A Warrantor is not liable under a Claim for any Loss that a Warrantee Group Member or $(a)$ (only in the case where the Warrantor is the Sellers or Ever Green Sellers) a Transaction Entity recovers, or is compensated for, under a Transaction Agreement.
$(b)$ This clause 9.9 does not prevent a Warrantee Group Member or (only in the case where the Warrantor is the Sellers or Ever Green Sellers) any Transaction Entity entitled to make a claim under a Transaction Agreement from commencing that claim. However, if for any reason more than one amount is paid in respect of the same Loss, the Warrantee must procure that the additional amount is immediately repaid to one or more Warrantor Group Members nominated by the Warrantor so as to give full effect to clause 9.9(a).

9.10 Mitigation of loss

$(a)$ The Warrantee must:
take, and procure that each other Warrantee Group Member and (only in the $(1)$ case where the Warrantor is the Sellers or Ever Green Sellers) Transaction Entity takes, all reasonable actions to mitigate any Loss that may give rise to a Claim: and
not omit, and procure that no other Warrantee Group Member or (only in the $(2)$ case where the Warrantor is the Sellers or Ever Green Sellers) Transaction Entity omits, to take any reasonable action that would mitigate any Loss that may give rise to a Claim.
If the Warrantee does not comply with clause 9.10(a) and compliance with clause 9.10(a) $(b)$ would have mitigated the Loss, the Warrantor is not liable for the amount by which the Loss would have been reduced.

General limitations 9.11

A Warrantor is not liable under a Claim, other than a Tax Claim, for any Loss to the extent that Loss:

(provisions in accounts): has been included as a provision, allowance, reserve or $(a)$ accrual in the Warrantor Accounts or that arises in respect of a matter that has been noted in the Warrantor Accounts;
(contingent losses): is contingent, unless and until the Loss becomes an actual Loss $(b)$ and is due and payable;
(pre Completion actions): arises from an act or omission by or on behalf of a Warrantor $(c)$ Group Member or (only in the case where the Warrantor is the Sellers or Ever Green Sellers) a Transaction Entity before Completion that was done or made:
with the knowledge of a Warrantee Group Member and Warrantee did not $(1)$ object to the act or omission;
$(2)$ with the written consent of a Warrantee Group Member; or
at the written direction or instruction of a Warrantee Group Member; $(3)$
$(d)$ (change of law or interpretation): arises from:
$(1)$ the enactment or amendment of any legislation or regulations;
$(2)$ a change in the judicial or administrative interpretation of the law; or
a change in the practice or policy of any Governmental Agency, $(3)$

after the date of this agreement, including legislation, regulations, amendments, interpretation, practice or policy that has a retrospective effect;

(change in ownership): would not have arisen but for a change in ownership of (if the $(e)$ Warrantor is the Sellers or Ever Green Sellers) the Transaction Entities or (if the Warrantor is Grange) the Grange Group Members, or a restructure of the Warrantor Business, on or after Completion;

$(f)$ (change in accounting policy): would not have arisen but for a change after Completion in any accounting policy or practice of a Warrantee Group Member or (if the Warrantor is the Sellers or Ever Green Sellers) a Transaction Entity or (if the Warrantor is Grange) a Grange Group Member that applied before Completion unless the change is to bring the accounting principles or practices into line with the generally accepted accounting principles and practices in Australia in relation to the business of the type carried on by the relevant company;
(change of Warrantor Business): arises out of the cessation or alteration of the $(q)$ Warrantor Business after Completion: or
$(h)$ (remediable loss): is remediable, provided it is remedied to the satisfaction of the Warrantee, acting reasonably, within 30 Business Days after the Warrantor receives written notice of the Claim in accordance with clause 10.1(a).

Limitations in relation to Tax 9.12

A Warrantor is not liable under a Claim for any Loss that: $(a)$
(inconsistent position): arises from (if the Warrantor is the Sellers or Ever $(1)$ Green Sellers) a Transaction Entity or (if the Warrantor is Grange) a Grange Group Member taking a position in relation to the application of a Tax Law that is inconsistent with the position taken by that entity before Completion (including any position adopted in relation to the preparation of any Pre Completion Returns), unless the relevant entity is required to adopt an inconsistent position to comply with a Tax Law; or
(failure to take action): arises from a (if the Warrantor is the Sellers or Ever $(2)$ Green Sellers) a Transaction Entity's or (if the Warrantor is Grange) a Grange Group Member's failure to take any action after Completion required by, or that should reasonably be taken under, any applicable Tax Law in relation to any Tax or Duty (including any failure to take any such action within the time allowed); or
$(3)$ (change in ownership or accounting policy): arises from a change in ownership of (if the Warrantor is the Sellers or Ever Green Sellers) the Transaction Entities or (if the Warrantor is Grange) the Grange Group Members, or a restructure of the Warrantor Business, on or after Completion, or any change after Completion in the accounting policy or practice of a Warrantee Group Member or (if the Warrantor is the Sellers or Ever Green Sellers) a Transaction Entity or (if the Warrantor is Grange) a Grange Group Member that applied before Completion unless the change is to bring the accounting principles or practices into line with the generally accepted accounting principles and practices in Australia in relation to the business of the type carried on by the relevant company; or
(cessation or alteration of the Warrantor Business): arises from the $(4)$ cessation or alteration of the Warrantor Business after Completion.
The Warrantee must notify the Warrantor of any change described in clause 9.12(a)(1) $(b)$ specifying the circumstances of the inconsistent position, at least 21 days before the relevant entity adopts it.

9.13 Sole remedy

$(a)$ It is the intention of the parties that the Warrantee's and the Warrantee Group's sole remedies in connection with the Transaction will be as set out in the Transaction Agreements.
$(b)$ No Warrantor Group Member has any liability to a Warrantee Group Member or (only in the case where the Warrantor is the Sellers or Ever Green Sellers) a Transaction Entity:
$(1)$ in connection with the Transaction or the matters the subject of the Transaction Agreements or the Warrantor Disclosure Materials; or
$(2)$ resulting from or implied by conduct made in the course of communications or negotiations in respect of the Transaction or the matters the subject of the Transaction Agreements or the Warrantor Disclosure Materials,

under a Claim unless the Claim may be made under the terms of the Transaction Agreements or arises out of a statutory right or other claim that cannot be excluded by contract.

$(c)$ The Warrantee must not, and must procure that each Warrantee Group Member and (only in the case where the Warrantor is the Sellers or Ever Green Sellers) each Transaction Entity does not, make a Claim:
$(1)$ that Warrantee would not be entitled to make under the Transaction Agreements or that is otherwise inconsistent with the Warrantee's entitlement to make a Claim under this agreement;
$(2)$ against any current or former director, officer or employee of any Warrantor Group Member; or
against a Warrantor Group Member that is not a party to the Transaction $(3)$ Agreements.

and Warrantee acknowledge that to do so would be to seek to circumvent the parties' intention expressed in clause 9.13(a).

9.14 Independent limitations

Each qualification and limitation in this clause 9 is to be construed independently of the others and is not limited by any other qualification or limitation.

Procedures for dealing with Claims 10

$10.1$ Notice of Claims

$(a)$ (Actual Claims): A Warrantee must promptly notify the Warrantor in writing if:
$(1)$ it decides to make a Claim against the Warrantor that either alone or together with other Claims exceeds any applicable thresholds set out in clause 9.6(a);or
$(2)$ a Third Party Claim or Tax Demand is made that may give rise to a Claim against the Warrantor.
$(b)$ (Details required): The Warrantee must include in a notice given under clause 10.1(a) such details as available to the Warrantee including as far as reasonably practicable an estimate of the maximum amount of the Claim;
(Extracts): The Warrantee must also include in a notice given under clause 10.1(a) an $(c)$ extract of:
$(1)$ any part of a Demand (including a Tax Demand) that identifies the liability or amount to which the Claim relates or other evidence of the amount of the Demand to which the Claim relates: and
$(2)$ if available or relevant, any corresponding part of any adjustment sheet or other explanatory material issued by a Governmental Agency that specifies the basis for the Demand to which the Claim relates or other evidence of that basis.
(Compliance) If the Warrantee does not fully comply with this clause 10 in respect of a $(d)$ Claim, the Warrantor is not liable under the Claim to the extent that the non compliance has materially increased the amount of the Claim.

$10.2$ Third Party Claims

The Warrantee must procure that any Warrantee Group Member or (only in the case where the Warrantor is the Sellers or Ever Green Sellers) Transaction Entity that is conducting any proceedings or actions in respect of a Third Party Claim:

$(1)$ acts in good faith:
$(2)$ liaises with the Warrantor in relation to the defence of the Third Party Claim;
$(3)$ provides the Warrantor with reasonable access to a copy of any notice. correspondence or other document relating to the Third Party Claim: and
$(4)$ acts reasonably in all the circumstances, including, having regard to the likelihood of success and the effect of the proceedings or actions on the goodwill or reputation of the business of the Warrantor Group.

Tax Demands $10.3$

(No admission): The Warrantee must not, and must ensure that each Warrantee Group $(a)$ Member does not:
$(1)$ accept, compromise or pay,
$(2)$ agree to arbitrate, compromise or settle; or
$(3)$ make any admission or take any action in relation to,

a Tax Demand that may lead to liability on the part of a Warrantor under a Claim without the Warrantor's prior written approval (which must not be unreasonably withheld or delayed). However, the Warrantee or Warrantee Group Member may pay any Tax or Duty to a Governmental Agency by the due date for payment without affecting any of its rights under this agreement.

$(b)$ (Payment if not contesting a Tax Demand): If a Warrantor does not advise the Warrantee that it wishes to contest the Tax Demand then the Warrantor must pay in Immediately Available Funds the Tax Claim Amount notified by the Warrantee by the later $of:$
$(1)$ 2 Business Days before the due date for payment to the Governmental Agency: or
10 Business Days after receipt of the notice given by the Warrantee under $(2)$ clause 10.1.
(Contesting a Tax Demand): Following receipt of a notice under clause 10.1 in respect $(c)$ of a Claim that arises from or involves a Tax Demand, the Warrantor may, by written notice to the Warrantee no later than 5 Business Days before the due date for payment of the relevant Tax or Duty advise Grange that it wishes to contest the Tax Demand.
$(d)$ (Procedure for contesting a Tax Demand): If a Warrantor advises the Warrantee that it wishes to contest the Tax or Duty the subject of the Tax Demand then:
$(1)$ (Payment of Tax) the Warrantor must pay the Warrantee, in Immediately Available Funds, so much of the Tax or Duty as is required by the relevant Governmental Agency to be paid while any action is being taken under this clause 10.3 by the date that is the later of 2 Business Days before the due date for payment to the Governmental Agency and 10 Business Days after receipt of the notice given by the Warrantee under clause 10.1;
(Payment of Tax to a Governmental Agency) the amount paid by the $(2)$ Warrantor to the Warrantee pursuant to clause 10.3(d)(1) must be paid to the relevant Governmental Agency by the Warrantee; and
(Objection to Tax Demand or Disputing Action) at the Warrantor's written $(3)$ request, the Warrantee must take, or procure that the person required to pay the Tax or Duty (Tax Payor) takes such Disputing Action in a timely manner in relation to the Tax Demand as the Warrantor may reasonably require.
(Conduct of proceedings by the Warrantor): If the Warrantor contests the Tax or Duty $(e)$ the subject of a Tax Demand then the Warrantee must follow, and must procure that each Warrantee Group Member follows, all reasonable directions of the Warrantor relating to the conduct of any Disputing Action referred to in clause 10.3(d) and in this clause 10.3(e), including using professional advisers nominated by the Warrantor. In making any directions under this clause 10.3(e), the Warrantor must:
$(1)$ act in good faith:
$(2)$ liaise with the Warrantee in relation to conduct of Disputing Action referred to in clause $10.3(d)$ and clause $10.3(e)$ ;
provide the Warrantee with reasonable access to a copy of any notice, $(3)$ correspondence of other document relating to that Disputing Action; and
$(4)$ act reasonably in all the circumstances, including, having regard to the likelihood of success and the effect of the directions on the goodwill or reputation of the Warrantor Business or any party to this agreement.
(Expert Determination): $(f)$
$(1)$ If the Warrantee or the Warrantor cannot agree on any amount to be paid under the Tax Indemnity within 60 Business Days of a dispute arising, or within such further time as may be agreed between them, then either the Warrantee or the Warrantor may refer the agreement to an expert with the request that the expert make a decision on the disagreement as soon as practicable after receiving any submissions from the Warrantee and the Warrantor.
$(2)$ The expert is to be a person with over 15 years experience in Tax agreed by the parties, or failing such agreement, nominated by the President of the Tax Institute of Australia following a request by a party that the expert be appointed by him or her.
$(3)$ The decision of the expert is to be conclusive and binding on the parties in the absence of manifest error.
Unless the expert makes a determination regarding costs, the Warrantee and $(4)$ the Warrantor agree to each pay one half of the expert's costs and expenses in connection with the reference.
$(5)$ The expert is appointed as an expert and not as an arbitrator.
$(6)$ The procedures for determination are to be decided by the expert in its absolute discretion.
(Access): The Warrantee must provide, and must procure that each Warrantee Group $(q)$ Member provides, the Warrantor with all reasonable assistance requested by it in relation to the Tax Demand and the Disputing Action contemplated by clause 10.3(d) and clause 10.3(e) including providing, at the Warrantor's cost, access to witnesses and documentary or other evidence relevant to the Tax Demand or the Disputing Action, allowing it and its legal advisers to inspect and take copies of all relevant books, records, files and documents, and providing it with reasonable access to the personnel, premises and chattels of the Warrantor Group Members.

11 Period after Completion

$11.1$ Pre-Completion tax returns

The parties will co-operate in connection with the preparation and filing of any Tax return $(a)$ or Tax statement of a Transaction Entity with respect to a period or part period before the Completion Date and any administrative proceeding involving any such Tax return or Tax statement.
$(b)$ The Sellers will, at their own cost and expense, have the sole conduct and control of the preparation and filing of all Tax returns, forms or statements of each Transaction Entity to the extent they relate to any periods (or part periods) ending on or before the Completion Date (Pre Completion Returns).
The Sellers must deliver each Pre Completion Return to Grange as soon as it is available $(c)$ but no later than 20 Business Days (except in relation to the lodgement of BAS returns for GST, in which case no later than 4 Business Days) before it is due to be filed (taking into account any extension of time to file the Pre Completion Return that has been properly obtained) for Grange's review and comment. If Grange objects to any items set forth in the Pre Completion Return it must notify the Sellers of the objection as soon as it is

aware of the objection but no later than 10 Business Days (except in relation to the lodgement of BAS returns for GST, in which case no later than 2 Business Days) before the Pre Completion Return is due to be filed.

$(d)$ Grange will, at its own cost and expense, have the sole control of the preparation and filing of all Tax returns, forms or statements of each Transaction Entity for any period that includes, but does not end on or before the Completion Date (Straddle Returns).
Grange must procure that each Straddle Return is prepared in a manner consistent with $(e)$ the requirements of any Tax Law and must deliver each Straddle Return to the Sellers as soon as it is available but no later than 20 Business Days (except in relation to the lodgement of BAS returns for GST, in which case no later than 4 Business Days) before it is due to be filed for the relevant Seller's review and comment. If a Seller objects to any items set forth in the Straddle Return it must notify Grange of the objection as soon as it is aware of the objection but no later than 10 Business Days (except in relation to the lodgement of BAS returns for GST, in which case no later than 2 Business Days) before the Straddle Return is due to be filed.
$(f)$ If a Seller or Grange notifies the other parties of an objection to a Pre Completion Return or Straddle Return as applicable, the parties must attempt in good faith to resolve the dispute. If the parties cannot resolve any such dispute within 10 Business Days of the objection being notified, then:
$(1)$ the parties must appoint an expert agreed to by the parties, or, if they cannot agree on an expert within a further 5 Business Days, the parties must request the President for the time being of the Institute of Chartered Accountants in Australia to appoint an expert, to determine the proper amounts for the items remaining in dispute;
$(2)$ the expert's determination is, in the absence of manifest error, final and binding on the parties and a party must not commence court proceedings or arbitration in relation to the dispute; and
$(3)$ the expert's costs and expenses in connection with the dispute resolution proceedings will be borne by the parties in a manner determined by the expert (and either party may request that determination) and in the absence of such a determination will be borne by the relevant Seller and Grange equally.

The expert appointed under this clause 11.1(f) acts as an expert and not as an arbitrator. The dispute resolution proceedings under this clause 11.1(f) are not arbitration proceedings under the Commercial Arbitration Act 1985 (WA).

Grange must procure that each Straddle Return and (subject to the relevant Seller $(q)$ complying with clause 11.1(c) each Pre Completion Return is filed by the due date for filing. If a Pre Completion Return or Straddle Return is due before the date a disputed item is resolved under this clause 11.1. Grange must procure that the return is filed as prepared and must procure that an amended return, which reflects the resolution or the disputed items (either as resolved by agreement or by the expert), is filed immediately after the disputed items are resolved.
$(h)$ Except in relation to the preparation of Pre Completion Returns and Straddle Returns (to which clauses 11.1(b) to 11.1(q) apply) the parties agree that for the purposes of an audit by a Governmental Agency it is the intention for the Sellers to have the right to determine, control and where appropriate participate in the disclosure (including manner of disclosure) of any material or information to a Governmental Agency and any other dealings with the Governmental Agency in relation to Tax to the extent such disclosure or other dealings is in respect of any event, act, matter or transaction or amount derived (or

deemed to be derived) or expenditure incurred before, on, or as a result of, Completion (Pre Completion Tax Event).

Without limiting clause 11.1(h), from and after Completion Grange agrees that it will, and $(i)$ will procure that each Transaction Entity and Grange Group Member will:

$(1)$ not disclose any information or material to a Governmental Agency in relation to a Pre Completion Tax Event without the prior written consent of the relevant Seller (which consent will not be unreasonably withheld or delaved), except as required by law;
$(2)$ not make any admission of liability, or any agreement, compromise or settlement with a Governmental Agency in relation to a Pre Completion Tax Event without the prior written consent of the Sellers (such approval not to be unreasonably withheld or delayed); and
$(3)$ promptly provide the Sellers with copies of any correspondence with, or material provided to or by, a Governmental Agency and keep the Sellers informed of any oral discussions with a Governmental Agency in relation to a Pre Completion Tax Event.
$(4)$ If Grange provides a notice under clause 10.1 in respect of a Claim that arises from or involves a Tax Demand, then at all times from the date of receipt of that notice the provisions of clause 10.3 will apply to that Tax Demand or the Tax or Pre Completion Tax Event the subject of that Tax Demand and not this clause 11.1.

$11.2$ Treatment of Tax refunds

$(a)$ Grange must use reasonable diligence to pursue any entitlement to payment, credit, refund, rebate or reimbursement allowed by a Governmental Agency in respect of:
any Tax paid by the Transaction Entities before Completion or provided for in $(1)$ the Reference Date Balance Sheet except to the extent that the credit, refund, rebate or reimbursement is already provided for; or
$(2)$ any Tax paid by the Transaction Entities after Completion to the extent that any member of Grange Group has received an amount under a Tax Warranty for such Tax or an indemnity amount pursuant to the Tax Indemnity.
$(b)$ The Sellers must:
$(1)$ indemnify Grange against all costs, expenses that are or may be incurred by Grange from 1 July 2008 in pursuing any entitlement referred to in clause $11.2(a)$ ; and
$(2)$ pay to Grange any Tax which is required to be paid to a Governmental Agency to enable such entitlement to be pursued,

whether or not any amount has been or will be received by Grange in respect of doing SO.

$(c)$ Subject to receipt of the amounts referred to in clause 11.2(b). Grange must pay to the Sellers promptly any amounts received from a Government Agency in respect of any entitlement referred to in clause 11.2(a).

$(d)$ For the avoidance of doubt, clause 11.2(a) includes the benefit of any taxation loss not recognised in the Reference Date Balance Sheet, provided such taxation loss is available for utilisation by the SMAPL tax consolidated group (or the Grange tax consolidated group) from 1 July 2008 onwards. In the case of such taxation loss, Grange will make payment under this clause 11.2 at such time as the benefit of the taxation loss is realised.
Any amount paid by Grange to the Sellers under this clause will be in addition to and an $(e)$ increase in the Consideration.

$12$ GST

$12.1$ Definitions

Words used in this clause 12 that have a defined meaning in the GST Law have the same meaning as in the GST Law unless the context indicates otherwise.

$12.2$ GST

Unless expressly included, the consideration for any supply under or in connection with a $(a)$ Transaction Agreement does not include GST.
$(b)$ To the extent that any supply made under or in connection with a Transaction Agreement is a taxable supply (other than any supply made under another agreement that contains a specific provision dealing with GST), the recipient must pay, in addition to the consideration provided under a Transaction Agreement for that supply (unless it expressly includes GST) an amount (additional amount) equal to the amount of that consideration (or its GST exclusive market value) multiplied by the rate at which GST is imposed in respect of the supply. The recipient must pay the additional amount at the same time as the consideration to which it is referable.
$(c)$ Whenever an adjustment event occurs in relation to any taxable supply to which clause $12.2(b)$ applies:
$(1)$ the supplier must determine the amount of the GST component of the consideration payable; and
$(2)$ if the GST component of that consideration differs from the amount previously paid, the amount of the difference must be paid by, refunded to or credited to the recipient, as applicable.
$(d)$ If Grange is entitled to any input tax credit or decreasing adjustment in respect of any relevant transaction for which the Sellers have borne the related economic liability or cost, the Sellers reserve the unconditional right to recover from Grange an amount equal to the relevant input tax credit or decreasing adjustment in respect of the relevant transaction.

Tax invoices and adjustment notes $12.3$

The supplier must issue a Tax Invoice to the recipient of a supply to which clause 12.2 $(a)$ applies no later than 7 days following payment of the GST inclusive consideration for that supply under that clause.

$(b)$ The supplier must issue an adjustment note to the recipient of a supply whenever an adjustment event to which clause 12.2(c) occurs, no later than 7 days after the supplier becomes aware of the adjustment event.

$12.4$ Reimbursements

If a party is entitled under a Transaction Agreement to be reimbursed or indemnified by another party for a cost or expense incurred in connection with a Transaction Agreement, the reimbursement or indemnity payment must not include any GST component of the cost or expense for which an input tax credit may be claimed by the party being reimbursed or indemnified, or by its representative member.

$12.5$ Information, returns and accounting to end GST Group

After Completion:

Grange must ensure that each Transaction Entity gives the representative member of $(a)$ each Seller's GST Groups on a timely basis, all information that the Transaction Entity holds that is needed to lodge any GST return; and
$(b)$ each Seller must ensure that the representative member of the Seller's GST Groups:
$(1)$ applies to the Commissioner of Taxation to revoke the approval of the Transaction Entity as a member of the Seller's GST Groups; and
$(2)$ lodges the GST returns for the final period in which the Transaction Entity was a member of the Seller's GST Groups and remits all amounts in respect of GST to the Commissioner of Taxation as and when required by the GST Law.

12.6 Supplies between former members of the GST Group

If:

before Completion a Transaction Entity is a member of a Seller's GST Group: $(a)$
$(b)$ the Transaction Entity has made a supply to, or has been the recipient of a supply made by, another member of that Seller's GST Group;
due to Completion the Transaction Entity ceases to be eligible to be a member of that $(c)$ Seller's GST Group with effect from a date prior to the Completion Date;
because the supply would have been to another member of the Seller's GST Group, the $(d)$ supply would not have been treated as a taxable supply if it had been made while the Transaction Entity was a member of that Seller's GST Group;
$(e)$ the supply is pursuant to an agreement made before Completion;
that agreement does not contain a provision requiring the recipient to pay to the supplier $(f)$ any amount in respect of GST in addition to the consideration otherwise payable for the supply; and
the consideration negotiated by the parties for the supply was not calculated to include $(g)$ GST,

then after Completion, the relevant Seller (if the recipient of a taxable supply is not the Transaction Entity) or Grange (if the recipient of a taxable supply is the Transaction Entity) must ensure that the recipient of a taxable supply indemnifies the supplier of a taxable supply for any GST payable in respect of a supply and pays the amount of that GST in addition to the consideration for the supply.

Guarantee by Shagang Guarantor and RI Guarantor 13

$13.1$ Guarantee and indemnity

In this clause 13, a reference to: $(a)$
the Guarantor means each of the Shagang Guarantor and the RI Guarantor; $(1)$ and
$(2)$ the Guaranteed Party means Shagang (where the Guarantor is the Shagang Guarantor) and RI (where the Guarantor is the RI Guarantor).
The Guarantor: $(b)$
unconditionally and irrevocably guarantees to Grange on demand, the due and $(1)$ punctual performance of all present and future obligations of the Guaranteed Party under each Transaction Agreement and the payment of all present and future liabilities of the Guaranteed Party under each Transaction Agreement and must, on demand by Grange, perform such obligations or pay such liabilities in the manner specified in the relevant Transaction Agreement if the Guaranteed Party fails to do so on the due date; and
as a separate and additional liability, indemnifies Grange against all Loss, $(2)$ actions, proceedings and judgments of any nature, incurred by, brought, made or recovered against Grange arising from or in connection with any default or delay in the due and punctual performance of the Guaranteed Party's obligations under any Transaction Agreement.

$13.2$ Extent of guarantee and indemnity

The liability of the Guarantor under this clause 13 is not affected by anything which, but for this clause 13 might operate to release or exonerate the Guarantor in whole or in part from its obligations including any of the following, whether with or without the consent of the Guarantor:

the grant to the Guaranteed Party, the Guarantor or any other person of any time, waiver $(a)$ or other indulgence, or the discharge or release of the Guaranteed Party, the Guarantor or any other person from any liability or obligation;
any transaction or arrangement that may take place between the Guaranteed Party, the $(b)$ Guarantor, Grange or any other person;
$(c)$ Grange exercising or refraining from exercising its rights under any security or any other rights, powers or remedies against the Guaranteed Party or any other person;
$(d)$ the amendment, replacement, extinguishment, unenforceability, failure, loss, release, discharge, abandonment or transfer either in whole or in part and either with or without consideration, of any security now or in the future held by Grange from the Guaranteed Party, the Guarantor or any other person or by the taking of or failure to take any security;
the failure or omission or any delay by the Guaranteed Party or Grange to give notice to $(e)$ the Guarantor of any default by the Guaranteed Party under this agreement; and
any legal limitation, disability, incapacity or other circumstances related to the $(f)$ Guaranteed Party, the Guarantor or any other person.

Principal and independent obligation $13.3$

This clause 13 is a principal obligation and is not to be treated as ancillary or collateral to any other right or obligation and extends to cover this agreement as amended, varied, supplemented, renewed or replaced.

$13.4$ Continuing guarantee and indemnity

This clause 13 is a continuing obligation of the Guarantor, despite Completion, and remains in full force and effect for so long as the Guaranteed Party has any liability or obligation to Grange under this agreement and until all of those liabilities or obligations have been fully discharged.

13.5 Waiver of Rights

The Guarantor must not exercise any right of indemnity or subrogation which it might otherwise be entitled to claim and enforce against or in respect of the Guaranteed Party and irrevocably waives all of those rights or indemnity or subrogation it may have.

No withholdings 13.6

The Guarantor must make all payments that become due under this clause 13, free and $(a)$ clear and without deduction of all present and future withholdings (including taxes, duties, levies, imposts, deductions and charges of Australia or any other jurisdiction).
$(b)$ If the Guarantor is compelled by law to deduct any withholding, then in addition to any payment due under this clause 13, it must pay to Grange such amount as is necessary to ensure that the net amount received by Grange after withholding equals the amount Grange would otherwise been entitled to if not for the withholding.

$13.7$ Currency

The Guarantor must pay all moneys that it becomes liable to pay under this clause 13 in the currency in which they are payable under this agreement and free of any commissions and expenses relating to foreign currency conversion or any other charges or expenses.

13.8 Guarantor's Liability

The Guarantor's liability in respect of any Claim shall not exceed the Guaranteed Party's liability in respect of that Claim.

13.9 Restrictions on Guarantor's Dealings

The Guarantor irrevocably appoints Grange as its attorney to provide in the insolvency of the Guaranteed Party for all money to which the Guarantor may be entitled from that Guaranteed Party for all money to which the Guarantor may be entitled from that Guaranteed Party up to an amount which does not exceed the amount which may be payable by the Guarantor under any Transaction Agreement. The Guarantor acknowledges that Grange may, subject to the terms of this agreement, retain any money which Grange may receive from any proof on account of the Guarantor's liability under this clause 13.

14 Guarantee by Stemcor Guarantor

$14.1$ Guarantee

$(a)$ In this clause 14, a reference to:
$(1)$ the Guarantor means the Stemcor Guarantor; and
the Guaranteed Party means Stemcor. $(2)$
Subject to clause 14.8, the Guarantor unconditionally and irrevocably quarantees to $(b)$ Grange on demand, the due and punctual performance of the Guaranteed Party's obligations under this agreement.

$14.2$ Extent of guarantee

The liability of the Guarantor under this clause 14 is not affected by anything which, but for this clause 14 might operate to release or exonerate the Guarantor in whole or in part from its obligations including any of the following, whether with or without the consent of the Guarantor:

the grant to the Guaranteed Party, the Guarantor or any other person of any time, waiver $(a)$ or other indulgence, or the discharge or release of the Guaranteed Party, the Guarantor or any other person from any liability or obligation;
$(b)$ any transaction or arrangement that may take place between the Guaranteed Party, the Guarantor, Grange or any other person:
Grange exercising or refraining from exercising its rights under any security or any other $(c)$ rights, powers or remedies against the Guaranteed Party or any other person;
the amendment, replacement, extinguishment, unenforceability, failure, loss, release, $(d)$ discharge, abandonment or transfer either in whole or in part and either with or without consideration, of any security now or in the future held by Grange from the Guaranteed Party, the Guarantor or any other person or by the taking of or failure to take any security;
$(e)$ the failure or omission or any delay by the Guaranteed Party or Grange to give notice to the Guarantor of any default by the Guaranteed Party under this agreement; and
any legal limitation, disability, incapacity or other circumstances related to the $(f)$ Guaranteed Party, the Guarantor or any other person.

$14.3$ Principal and independent obligation

This clause 14 is a principal obligation and is not to be treated as ancillary or collateral to any other right or obligation and extends to cover this agreement as amended, varied, supplemented, renewed or replaced.

14.4 Continuing guarantee

Subject to clause 14.8, this clause 14 is a continuing obligation of the Guarantor, despite Completion, and remains in full force and effect for so long as the Guaranteed Party has any liability or obligation to Grange under this agreement and until all of those liabilities or obligations have been fully discharged.

14.5 No withholdings

The Guarantor must make all payments that become due under this clause 14, free and $(a)$ clear and without deduction of all present and future withholdings (including taxes, duties, levies, imposts, deductions and charges of Australia or any other jurisdiction).
If the Guarantor is compelled by law to deduct any withholding, then in addition to any $(b)$ payment due under this clause 14, it must pay to Grange such amount as is necessary to ensure that the net amount received by Grange after withholding equals the amount Grange would otherwise been entitled to if not for the withholding.

14.6 Currency

The Guarantor must pay all moneys that it becomes liable to pay under this clause 14 in the currency in which they are payable under this agreement and free of any commissions and expenses relating to foreign currency conversion or any other charges or expenses.

$14.7$ Guarantor's Liability

The Guarantor's liability in respect of any Claim shall not exceed the Guaranteed Party's liability in respect of that Claim and in any event \$43,500,000.

14.8 Termination of Guarantor's Liability

The Guarantor's liability under this clause 14 ceases and has no force or effect on and after the first anniversary of the Completion Date.

15 Escrow restrictions

15.1 Restrictions during the Escrow Period

During the period of 12 months from the date of this agreement (the Escrow Period), the Ever Green Sellers must not do any of the following without the written consent of Grange Dispose of the Consideration Shares.

15.2 Holding Lock

Each Ever Green Seller agrees that, to the extent permitted by the Listing Rules, including Listing Rule 8.10.1(i), a holding lock may be placed on the Consideration Shares on CHESS or any other register to prevent Proper ASTC Transfer of the Consideration Shares.

15.3 Notice

If an Ever Green Seller becomes aware:

that a dealing that is prohibited by clause 15.1 has occurred, or is likely to occur, during $(a)$ the Escrow Period; or
of any matter which is likely to give rise to such a prohibited dealing. $(b)$

that Ever Green Seller must notify Grange as soon as practicable after becoming aware of the dealing or the matters giving rise to the dealing, providing full details.

15.4 Consequences of breaching this clause 15

If it appears to Grange that an Ever Green Seller may breach this clause 15, Grange may $(a)$ take all steps permitted by the Listing Rules and the Settlement Rules and that are necessary to prevent the breach, or to enforce this clause 15.
If an Eyer Green Seller breaches this clause 15, each of the following applies: $(b)$
Grange may take all steps permitted by the Listing Rules and the Settlement $(1)$ Rules and that are necessary to enforce that Ever Green Seller's obligations under this clause 15, or to rectify a breach of this clause 15;
Grange may refuse to acknowledge, deal with, accept or register any sale, $(2)$ assignment, transfer or conversion of any of the Consideration Shares. This is in addition to other rights and remedies of Grange;
that Ever Green Seller will cease to be entitled to or receive any dividends or $(3)$ distributions or to exercise voting rights while the breach continues, and Grange must not pay any dividend or distribution to that Ever Green Seller while the breach continues; and
$(4)$ Grange will immediately notify, and make an announcement to, ASX regarding the breach of this clause 15 and, if necessary, immediately notify any other regulatory authorities of the breach.

$16$ Duty, costs and expenses

16.1 Stamp duty

Grange must:

pay all Duty and any fines and penalties with respect to Duty in respect of this agreement $(a)$ or the Transaction or the steps to be taken under this agreement or the Transaction; and

$(b)$ indemnify the Sellers against any liability arising from failure to comply with clause 16.1(a).

16.2 Costs and expenses

Except as otherwise provided in this agreement, each party must pay its own costs and expenses in connection with the negotiation, preparation, execution and performance of this agreement and the proposed, attempted or actual implementation of this agreement, the Transaction and the Transaction Agreements.

$17$ Confidentiality

Each party (recipient) must keep secret and confidential, and must not divulge or $(a)$ disclose any information relating to another party or its business (which is disclosed to the recipient by the other party, its representatives or advisers), this agreement or any Transaction Agreement or the terms of the Transaction other than to the extent that:
the information is in the public domain as at the date of this agreement (or $(1)$ subsequently becomes in the public domain other than by breach of any obligation of confidentiality binding on the recipient);
$(2)$ the recipient is required to disclose the information by applicable law or the rules of any recognised stock exchange on which its shares or the shares of any of its Related Bodies Corporate are listed or proposed to be listed. provided that the recipient has to the extent possible having regard to the required timing of the disclosure consulted with the provider of the information as to the form and content of the disclosure;
the disclosure is made by the recipient to its financiers or lawyers, accountants, $(3)$ investment bankers, consultants or other professional advisers to the extent necessary to enable the recipient to properly perform its obligations under this agreement or to conduct their business generally, in which case the recipient must ensure that such persons keep the information secret and confidential and do not divulge or disclose the information to any other person;
$(4)$ the disclosure is necessary to seek satisfaction of any of the conditions in clause 2.1 or for the purposes of clause 10.3(a), provided that the relevant Governmental Agency is made aware of the confidential nature of the information and is instructed to keep the information secret and confidential and does not divulge or disclose the information to any other person:
the disclosure is required for use in legal proceedings regarding this agreement $(5)$ or the Transaction:
$(6)$ the party to whom the information relates has consented in writing before the disclosure of the information relating to that party or its business; or
the other parties have consented in writing before the disclosure of any $(7)$ information relating to this agreement or any Transaction Agreement or the terms of the Transaction.
$(b)$ Each recipient must ensure that its directors, officers, employees, agents, representatives and Related Bodies Corporate comply in all respects with the recipient's obligations under this clause 17.
$(c)$ From Completion, Grange may disclose confidential information relating to the business of a Transaction Entity except to the extent that such information relates to a Seller Group Member or its business.

18 General

$18.1$ No representation or reliance

Each party acknowledges that no party (nor any person acting on its behalf) has made $(a)$ any representation or other inducement to it to enter into this agreement, except for representations or inducements expressly set out in this agreement and, in relation to Shagang and Grange only, the Merger Implementation Agreement.
$(b)$ Each party acknowledges and confirms that it does not enter into this agreement in reliance on any representation or other inducement by or on behalf of any other party, except for any representation or inducement expressly set out in this agreement and, in relation to Shagang and Grange only, the Merger Implementation Agreement.
Each party acknowledges and confirms that clauses 18.1(a) and (b) do not prejudice any $(c)$ rights a party may have in relation to information which has been filed by the other party with the ASIC or ASX.

18.2 No merger

The rights and obligations of the parties do not merge on completion of the Transaction. They survive the execution and delivery of any assignment or other document entered into for the purpose of implementing the Transaction.

18.3 Prohibition and enforceability

Any provision of, or the application of any provision of, this agreement that is prohibited in $(a)$ any jurisdiction is, in that jurisdiction, ineffective only to the extent of that prohibition.
Any provision of, or the application of any provision of, this agreement that is void, illegal $(b)$ or unenforceable in any jurisdiction does not affect the validity, legality or enforceability of that provision in any other jurisdiction or of the remaining provisions in that or any other jurisdiction.

18.4 Severability

Any provision in this agreement that is invalid or unenforceable in any jurisdiction is to be read down for the purpose of that jurisdiction, if possible, so as to be valid and enforceable, and otherwise shall be severed to the extent of the invalidity or unenforceability, without affecting the remaining provisions of this agreement or affecting the validity or enforceability of that provision in any other jurisdiction.

18.5 Consents

Any consent referred to in, or required under, this agreement from any party may not be unreasonably withheld, unless this agreement expressly provides for that consent to be given in that party's absolute discretion.

18.6 Notices

Any communication under or in connection with this agreement:

$(a)$ must be in writing;

must be addressed as shown below: $(b)$

Grange
Name:	Grange Resources Limited
Address:	Level 11, 200 St Georges Terrace, Perth WA 6000
Fax no:	(08) 9321 1523
For the attention of:	Russell Clark, Managing Director and Chief Executive Officer
Shagang
Name:	Shagang International Holdings Limited
Address:	Unit 2902, 29/F Far East Finance Centre, 16 Harcourt Road, Admiralty, Hong Kong
Fax no:	00852-28875082 (Tel: 00852-28875081)
For the attention of:	Mr. Peter Chen
RI
Name:	RGL Holdings Co., Ltd
Address:	23/F, New Poly Plaza, No. 1 North Chaoyangmen Street, Dongcheng District, Beijing 100010, People's Republic of China
Fax no:	+86 10 84193770
For the attention of:	Ms Gong Hong or Ms Du Fang
ΡI
Name:	Pacific International Co. Pty Ltd
Address:	Unit 2102, 21/F Sino Plaza, 255-257 Gloucester Road, Causeway Bay, Hong Kong
Fax no:	(852) 2907 6833
For the attention of:	Ko Cheung Clement
Stemcor
Name:	c/o Stemcor Europe AG
Address:	Grafenauweg 4
	6300 Zug
	Switzerland

Fax no:

For the attention of:

00 41 41 619 8787

Paul Whitehead, Director of Mining and

Graham Donnell, General Counsel

(or as otherwise notified by that party to the other party from time to time);

$(c)$ must be signed by the party making the communication or by a person duly authorised by that party;
$(d)$ must be delivered or posted by prepaid post to the address, or sent by fax to the number, of the addressee, in accordance with clause 18.6(b); and
is regarded as received by the addressee: $(e)$
$(1)$ if sent by prepaid post, on the third Business Day after the date of posting to an address within Australia, and on the fifth Business Day after the date of posting to an address outside Australia:
$(2)$ if sent by fax, at the local time (in the place of receipt of that fax) which then equates to the time at which that fax is sent as shown on the transmission report which is produced by the machine from which that fax is sent and which confirms transmission of that fax in its entirety, unless that local time is not a Business Day, or is after 5.00pm on a Business Day, when that communication will be regarded as received at 9.00am on the next Business Day; and
if delivered by hand, on delivery at the address of the addressee as provided in $(3)$ clause 18.6(b), unless delivery is not made on a Business Day, or after 5.00pm on a Business Day, when that communication will be regarded as received at 9.00am on the next Business Day.

18.7 Service of process

Without preventing any other mode of service, any document in an action (including, any $(a)$ writ of summons or other originating process or any third or other party notice) may be served on any party by being delivered to or left for that party at its address for service of notices under clause 18.6.
$(b)$ The Sellers irrevocably appoint Freehills of Level 36, QV.1 Building, 250 St Georges Terrace, Perth, WA 6000 as their agent for the service of process in Australia in relation to any matter arising out of this agreement. If Freehills ceases to be able to act as such or have an address in Australia, the Sellers agree to appoint a new process agent in Australia and deliver to the other parties within 20 Business Days a copy of a written acceptance of appointment by the process agent, upon receipt of which the new appointment becomes effective for the purpose of each Transaction Agreement. The Sellers must inform the other parties in writing of any change in the address of its process agent within 20 Business Days of the change.

18.8 Governing law and jurisdiction

This agreement is governed by the laws of Western Australia. $(a)$
$(b)$ Each party irrevocably submits to the non-exclusive jurisdiction of the courts of Western Australia and courts competent to hear appeals from those courts.

18.9 Waivers

$(a)$ Failure to exercise or enforce, a delay in exercising or enforcing, or the partial exercise or enforcement of any right, power or remedy provided by law or under this agreement by any party does not in any way preclude, or operate as a waiver of, any exercise or enforcement, or further exercise or enforcement, of that or any other right, power or remedy provided by law or under this agreement.
Any waiver or consent given by any party under this agreement is only effective and $(b)$ binding on that party if it is given or confirmed in writing by that party.
No waiver of a breach of any term of this agreement operates as a waiver of another $(c)$ breach of that term or of a breach of any other term of this agreement.

18.10 Variation

This agreement may only be varied by a document signed by or on behalf of each of the parties.

18.11 Assignment

A party may not assign, novate or otherwise transfer any of its rights or obligations under this agreement without the prior written consent of the other party.

Further action 18.12

Each party will do all things and execute all further documents necessary to give full effect to this agreement.

18.13 Entire agreement

This agreement supersedes all previous agreements in respect of its subject matter and, together with the Merger Implementation Agreement in respect of Grange and Shagang, embodies the entire agreement between the parties.

18.14 Counterparts

$(a)$ This agreement may be executed in any number of counterparts.
$(b)$ All counterparts, taken together, constitute one instrument.
$(c)$ A party may execute this agreement by signing any counterpart.

Schedules

$\hat{\mathcal{A}}$

Schedule 1 - Warranties Schedule 2 - Schedule of Capital

$\bar{\mathcal{A}}$

Schedule 1

Warranties

Definitions $\mathbf 1$

In sections 1, 2 and 3 of this Schedule 1, the capitalised terms have the meaning set out below and, where no definition is set out below, it has the meaning set out in section 1 of this agreement.

Term	Meaning
ABM Cares Manual	means the ABM Cares Manual provided in the Sellers Disclosure Materials.
Accounting Standards	means, at any time:
	(a) the requirement of the Corporations Act about the preparation and contents of financial reports;
	(b) the accounting standards approved under the Corporations Act; and
	(c) generally accepted accounting principles, policies, practices and procedures in Australia to the extent not inconsistent with the accounting standards described in paragraph (b).
Approval	means any licence, permit, consent, certificate, notification, declaration or other authorisation required for the lawful use and occupation of the Mining Tenements.
Asset	means each asset owned or held by the Transaction Entity or used in the Business, including any assets held under financing or operating lease.
Australian Consolidated Group	means the tax consolidated group formed by SMAPL and its wholly-owned Australian subsidiaries from 16 August 2007 in accordance with Part 3-90 of the Tax Act.
Australian Group Company	means SMAPL and any subsidiary members of the Australian Consolidated Group as defined in Part 3-90 of the Tax Act.
Authorised Purpose	means any purpose for which that the holder of a Mining Tenement is authorised to use or occupy a Mining Tenement, whether under the terms of the relevant Mining Tenement or under the MRD Act and Regulations.

$\mathcal{L}_{\mathcal{A}}$

Term	Meaning
AWA	means an Australian Workplace Agreement.
Business	means the business conducted by the Transaction Entities as at the Completion Date.
Confidential Information	means:
	(a) all information treated by any Transaction Entity as confidential relating to the operations or affairs of any Transaction Entity including all financial or accounting information, all customer names and lists, sales records, marketing research and reports and other marketing information and all trade secrets, know how, operating procedures and technical information; and
	(b) all other information treated by any Transaction Entity as confidential or the disclosure of which might cause loss or damage to or otherwise adversely affect any Transaction Entity,
	in whatever form.
Contamination	means a solid, liquid, gas, odour, heat, sound, vibration, radiation, substance or matter present in, on or under land, air or water at a concentration above the concentration at which it is naturally present in, on or under land, air or water (as the case may be) in the same locality, that presents, or has the potential to present, a material risk of harm to human health, or could give rise to a material risk of non-compliance with any Environmental Law.
Employee	the employees of the Transaction Entities as disclosed in the schedule of employees contained in the Sellers Disclosure Materials.
Environment	means the physical, biological and social aspects and conditions of earth, including:
	(a) land, water, air, atmosphere, climate, living organisms and other matter, things made or altered by humans, ecosystems and social groupings;
	(b) the social, economic and cultural aspects of a thing specified in paragraph (a); and
	(c) the interaction of any 2 or more things specified in paragraphs (a) and (b).
Environmental Law	means any law (including statutes, regulations, by-laws ordinances and other delegated legislation, any statutory permit, licence, notice or direction and any rule of common law, contract, tort or equity and their enforcement and administration) relating to the Environment or its protection including those relating to:
	(a) the discharge or emission of substances, including, but not limited to,

$\mathcal{L}$

Term	Meaning
		greenhouse gases;
	(b)	the generation of odour, heat, sound, vibration, or radiation;
	(c)	Contamination;
	(d)	the production, use, handling, storage, disposal or transport of waste, hazardous substances, radioactive substances or dangerous goods;
	(e)	the presence of asbestos;
	(f)	threatened or endangered flora, fauna, ecological communities
	(g)	biodiversity; or
	(h)	environmental heritage.
Fund	means each superannuation fund to which the Transaction Entity contributes, or is required to contribute, in respect of any Employee or consultant engaged by that Transaction Entity.
Freehold Properties	means each of the properties described below:
	(a)	Lot 2 on Plan 23483 (Corinna Road, Savage River, Tasmania);
	(b)	Lot 1 on Plan 55114 ("ABM Lodge" Corinna Road, Savage River, Tasmania);
	(c)	Lot 2 on Plan 55114 (Corinna Road, Savage River, Tasmania);
	(d)	Lot 3 on Plan 55114 (Corinna Road, Savage River, Tasmania);
	(e)	Lot 234 on Plan 55117 (Corinna Road, Savage River, Tasmania);
	(f)	Lot 1 on Plan 65928 (Meredith Crescent, Savage River, Tasmania);
	(g)	Lot 1 on Plan 66530 (Corinna Road, Savage River, Tasmania);
	(h)	Lot 2 on Plan 66530 (Corinna Road, Savage River, Tasmania);
	(i)	Lot 101 on Plan 6887 (Meredith Crescent, Savage River, Tasmania);
	$\left( j\right)$	Lot 1 on Plan 14503 (Meredith Crescent, Savage River, Tasmania);
	(k)	Lot 1 on Plan 22140 (Corinna Road, Savage River, Tasmania),
	$\left( 1\right)$	Lot 1 on Plan 251431 (Meredith Crescent, Savage River, Tasmania); and
	(m)	Lot 1 on Plan 64188 (Corinna Road, Savage River, Tasmania).

$\hat{\mathcal{L}}$

Term	Meaning
Goldamere Pty Ltd	means Goldamere Pty Ltd ACN 073 634 581
Group Liability	has the meaning given in section 721-10 of the Tax Act.
Head Company	has the meaning given in section 995-1 of the Tax Act.
Insurance Manual	the insurance manual disclosed in the Sellers Disclosure Materials.
Intellectual Property Rights	means:
	(a) the various intellectual property rights conferred by statute, common law and equity, including patents of any kind, inventions, utility models, designs, copyright, trade marks, trade names, business names, corporate names, logos and get up, circuit layouts, Know- how, trade secrets and confidential information and all other intellectual property rights as defined by Article 2 of the World Intellectual Property Organisation Convention of July 1967,
	and includes:
	(b) all applications for registration, extension, renewal or otherwise in respect of the rights and property referred to in paragraph (a) of this definition; and
	(c) all rights of action in respect of the rights or property referred to in paragraph (a) of this definition.
ITEA	means an Individual Transitional Staff Employment Agreement.
Know-how	means knowledge, information and know-how in any form, whether that knowledge, information and know-how is confidential or otherwise, including, but not limited to:
	(a) drawings, technical drawings, specifications, schematic diagrams and plans;
	(b) documentation, manuals, instructions and data;
	(c) scientific or other processes, methods and techniques; and
	(d) expertise.
Last Accounts	means the accounts comprising the audited consolidated general purpose accounts for the period from 16 August 2007 to 31 December 2007.
Last Balance Date	means 31 December 2007.

Term	Meaning
Leases	means the leases which are disclosed in the Sellers Disclosure Materials to which a Transaction Entity is a party.
Leasehold Properties	means each of the following leased properties.
	(a) 58-60 Wilmot Street, Burnie, Tasmania; and
	(b) 1025 Ridgley Highway, Ridgley, Tasmania,
	the subject of the Leases.
MRD Act and Regulations	means the Mineral Resources and Development Act 1995 (Tas) and the Mineral Resources Regulations 1996 (Tas).
Mining Tenements	means:
	(a) mining leases 2M/2001 and 14M/2007; and
	(b) exploration licenses 30/2003, 19/2005 and 46/2007.
Properties	means the Freehold Properties and Leasehold Properties.
Records	means all originals and copies of all books, records, reports, correspondence, files, manuals and other documents and information created by, owned by, or relating to any Transaction Entity, whether in printed, electronic or any other form and including all:
	Authorisations;
	statutory books and registers, minute books, nooks of accounts, trading and financial records, employee records, tax returns and related correspondence:
	customer lists, supplier lists, pricing models and sales and marketing materials;
	title deeds and other documents of title; and
	contracts.
Regulatory Authority	means:
	(a) any government or local authority and any department, minister or agency of any government; and
	(b) any other authority, agency, commission or similar entity having powers or jurisdiction under any law or regulation or the listing rules of any recognised stock or securities exchange.
Related Entity	of a corporation means:

Term	Meaning
	(a) a related body corporate of that corporation within the meaning of section 50 of the Corporations Act; and (b) a unit trust in relation to which that corporation directly or indirectly: (1) controls the right to appoint the trustee; (2) is in a position to control the casting of, more than one half of the maximum number of votes that might be cast at a meeting of holders of units in the trust; or (3) holds or is in a position to control the disposal of more than one half of the issued units of the trust.
Representatives	means, in relation to a party, all officers, employees, professional advisers and agents of the party or of its Related Entities.
Reviewed Accounts	means the accounts comprising the reviewed interim accounts for the 6 months to 30 June 2008 for Ever Green and SMAPL.
Seller Group Member	means the Seller and each Related Entity of the Seller other than each Transaction Entity.
State	the State of Tasmania.
State Agreement	means the agreement between the Crown in Right of the State, Goldamere Pty Ltd and Ivanhoe Capital Pte Ltd dated 26 September 1996 and appended to the Goldamere Pty Ltd (Agreement) Act 1996 (Tas).
SRRP	means the Savage River Rehabilitation Project managed by the management committee referred to in schedule 3 of the Deed of Variation (dated 4 October 2000 between Goldamere Pty Ltd and the Crown in Right of the State of Tasmania) to the Goldamere Agreement (dated 10 December 1996 between Goldamere Pty Ltd and the Crown in Right of the State of Tasmania) provided in the Sellers Disclosure Materials.
Subsidiaries	means each of the Transaction Entities other than Ever Green.
Systems	means all information technology and communications systems used by any Transaction Entity in the conduct of the Business in the manner it is being conducted at the date of this agreement including all hardware, software, networks, mobile communications devices and peripherals.
Tax and other Fees	means any tax, levy, excise, duty, charge, surcharge, contribution, withholding tax, impost or withholding obligation of whatever nature, whether direct or indirect, by whatever method collected or recovered, together with any penalties, fines, interest or statutory charges.

$\ddot{\phantom{a}}$

Term	Meaning
Tax Act		means the Income Tax Assessment Act 1936 (Cth) and the Income Tax Assessment Act 1997 (Cth) or either of them.
Tax Funding Liabilities	means any liability to make payments or to fund a Head Company in respect of a Group Liability.
Tenement Obligations		means all obligations that Goldamere has in relation to the Mining Tenements, whether under the terms of the relevant Mining Tenement or the MRD Act and Regulations, including but not limited to:
	(a)	all obligations to effect and maintain insurances in relation to any Mining Tenement;
	(b)	all obligations to pay rents and royalties to the State applicable to each Mining Tenement;
	(c)	all obligations to pay all minimum expenditure requirements in respect of each Mining Tenement;
	(d)	all obligations to lodge and maintain any bonds and security payments applicable to each Mining Tenement; and
	(e)	all obligations to report to the State, and otherwise keep the State informed as to, all relevant activities on and production from each Mining Tenement.
Tenement Notice		means any actual or proposed claims, demands, actions, suits or orders concerning the Mining Tenements whether made by the State or otherwise.

Individual Seller Warranties $\overline{2}$

No legal impediment $2.1$

The execution, delivery and performance by each Seller of this agreement (and in the case of Shagang, the Merger Implementation Agreement):

complies with its constitution or other constituent documents; and $(a)$
does not constitute a breach of any law or obligation, or cause or result in a default under $(b)$ any agreement, or Encumbrance, by which it is bound and that would prevent it from entering into and performing its obligations under this agreement.

$2.2$ Corporate Authorisations

All necessary authorisations for the execution, delivery and performance by each Seller of this agreement (and in the case of Shagang, the Merger Implementation Agreement) in accordance with its terms have been obtained or will be obtained before Completion.

$2.3$ Power and capacity

Each Seller has full power and capacity to own its own assets and to enter into and perform its obligations under this agreement (and in the case of Shagang, the Merger Implementation Agreement).

$2.4$ Incorporation

Each Seller is validly incorporated, organised and subsisting in accordance with the laws of its place of incorporation.

$2.5$ Seller Group Members

Each Seller Group Member:

$(a)$ is duly incorporated under the laws of the place of its incorporation:
$(b)$ has the power to own its assets and carry on its business as it is being carried on at Completion:
is duly registered and authorised to do business in those jurisdictions that, by the nature $(c)$ of its business and assets, makes registration or authorisation necessary; and
$(d)$ has conducted its business in compliance with the constitution or other constituent documents of that Seller Group Member.

$2.6$ No trust

Each Seller enters into and performs this agreement (and in the case of Shagang, the Merger Implementation Agreement) on its own account and not as trustee for or nominee of any other person.

$2.7$ Enforceability

Each Seller's obligations under this agreement (and in the case of Shagang, the Merger Implementation Agreement) are enforceable in accordance with its terms.

$2.8$ The Sale Shares

As at the date of this agreement, each Seller holds full legal and beneficial ownership of the Sale Shares which are held by it, free and clear of all Encumbrances.

$(a)$ Grange will acquire at Completion:
the full legal and beneficial ownership of the Sale Shares free and clear of all $(1)$ Encumbrances, subject to registration of Grange in the register of shareholders:
$(2)$ the Sale Shares free of competing rights, including pre-emptive rights or rights of first refusal (except as expressly described in this agreement); and
the Sale Shares, all of which are fully paid and have no money owing in respect $(3)$ of them.
$(b)$ The Sale Shares, immediately after Completion, will:
in the case of the Shagang Shares, RI Shares and PI Shares, represent 100% $(1)$ of the issued share capital of Ever Green; and
$(2)$ in the case of the Stemcor Shares, represent 10% of the issued share capital of SMAPL.

2.9 Breach or default

The execution, delivery and performance of this agreement by each Seller does not and will not result in a breach of or constitute a default under:

$(a)$ any agreement to which the Seller is party;
$(b)$ any provision of the constitution of the Seller; or
any law or regulation or any order or judgment of any court or Regulatory Authority to $(c)$ which the Seller is a party or by which the Seller is bound.

2.10 Solvency

None of the following events has occurred in relation to each Seller:

$(a)$ a receiver, receiver and manager, liquidator, provisional liquidator, administrator, trustee or similar officer is appointed in respect of the Seller or any of its assets or an event occurs that gives any person the right to seek such an appointment;
an application is made to court or a resolution is passed or an order is made for the $(b)$ winding up or dissolution of the Seller or an event occurs that would give any person the right to make such an application;
$(c)$ the Seller proposes or takes any steps to implement a scheme of arrangement or other compromise or arrangement with its creditors or any class of them;
the Seller stops paying its debts when they become due or is declared or taken under any $(d)$ applicable law to be insolvent or the Seller's board of directors resolves that the Seller is, or is likely to become at some future time, insolvent; or
any person in whose favour the Seller has granted any Encumbrance becomes entitled to $(e)$ enforce any security under that Encumbrance or any floating charge under that Encumbrance crystallises.

$2.11$ Shareholder Loan Agreements

Other than the loans that are the subject of the Shareholder Loan Agreements, there are no loans between any Transaction Entity (or its Related Entity) and any Seller (or its Related Entity).

Ever Green Warranties 3

$3.1$ Breach or default

The execution, delivery and performance of this agreement by the Ever Green Sellers does not and will not result in:

a breach of or constitute a default under: $(a)$
$(1)$ any agreement to which any Transaction Entity is party; or
any law or regulation or any order or judgment of any court or Regulatory $(2)$ Authority to which any Transaction Entity is a party or by which any Transaction Entity is bound; or
any material adverse effect on the Business. $(b)$

$3.2$ Consents

Other than the consents referred to in clause 2.1 of this agreement which are required to be obtained as a condition precedent to this agreement, each Transaction Entity has, before the Completion Date, obtained all consents that are required under any applicable laws or any agreement to which a Transaction Entity is a party for the performance of each Transaction Document, including each party's obligation for Completion (including any consents or approvals that are required from the Crown in the right of Tasmania).

$3.3$ Shares and share capital

Ownership of shares in the Subsidiaries $(a)$

All of the shares in the Subsidiaries are legally and beneficially owned by a Transaction Entity.

Issue of further securities $(b)$

No person has any right to require the issue of any shares or other securities in any Transaction Entity and no Transaction Entity has made any offer that may result in any person having such a right, except pursuant to the Transaction.

Capital Structure $(c)$

The issued capital structure of each Transaction Entity immediately before Completion is set out in Schedule 2 and none of the Transaction Entities have granted any employee share options or share awards to any People's Republic of China nationals which are outstanding as at the date of this agreement.

$(d)$ Ever Green's ownership of 90% of SMAPL

Ever Green is the legal and beneficial owner of 90% of the issued share capital of SMAPL free and clear of all Encumbrances:

$(1)$ free of competing rights, including pre-emptive rights or rights of first refusal; and
$(2)$ these shares are fully paid and have no money owing in respect of them.

$3.4$ Corporate matters

Incorporation $(a)$

Each Transaction Entity is a company properly incorporated and validly existing under the laws of the country or jurisdiction of its incorporation and has the legal right and full corporate power to own its assets and to carry on its business as conducted at the date of this agreement.

$(b)$ Solvency

None of the following events has occurred in relation to any Transaction Entity:

$(1)$ a receiver, receiver and manager, liquidator, provisional liquidator, administrator, trustee or similar officer is appointed in respect of that Transaction Entity or any of its Assets or an event occurs that gives any person the right to seek such an appointment;
$(2)$ an application is made to court or a resolution is passed or an order is made for the winding up or dissolution of that Transaction Entity or an event occurs that would give any person the right to make such an application:
$(3)$ that Transaction Entity proposes or takes any steps to implement a scheme of arrangement or other compromise or arrangement with its creditors or any class of them;
$(4)$ that Transaction Entity stops paying its debts when they become due or is declared or taken under any applicable law to be insolvent or the board of directors of that Transaction Entity resolves that it is, or is likely to become at some future time, insolvent; or
any person in whose favour that Transaction Entity has granted any $(5)$ Encumbrance becomes entitled to enforce any security under that Encumbrance or any floating charge under any such Encumbrance crystallises.

Books and records $(c)$

All Records of each Transaction Entity:

have been fully and properly maintained and contain materially complete and $(1)$ accurate records of all matters required to be entered in them by any law or regulation or by the Accounting Standards;
$(2)$ are in the possession or control of the relevant Transaction Entity,

and no Transaction Entity has received any notice or allegation that any of them is materially incorrect or should be rectified or amended.

$3.5$ Conduct of business

Compliance $(a)$

Each Transaction Entity has since incorporation conducted its business and affairs in all material respects in accordance with its constitution and in accordance with all applicable laws and regulations.

Authorisations $(b)$

Each Transaction Entity has obtained and complied with the terms of all material Authorisations necessary to enable the Transaction Entities to conduct the Business in the locations and in the manner in which it is conducted at the date of this agreement (Material Authorisations). As far as the Ever Green Sellers are aware:

the acquisition by Grange of the Sale Shares will not result in, and no other $(1)$ circumstance exists which may result in, any Material Authorisation being terminated, suspended or modified in any material respect or not being renewed; and
$(2)$ no material work or expenditure is required to maintain or secure the ability of any Transaction Entity to renew any Material Authorisation.

$(c)$ Orders, directions and notices

No Transaction Entity has received or is in breach of any order, direction or notice from any Regulatory Authority in any jurisdiction or any other person requiring expenditure by any Transaction Entity or which might otherwise adversely affect the Business or the use of any Property by any Transaction Entity that has not been complied with in all material respects. As far as the Ever Green Sellers are aware, as at the date of this agreement no circumstance exists that may result in any such order being made or direction or notice being given.

$3.6$ Accounts

The Last Accounts $(a)$

The Last Accounts:

$(1)$ give a true and fair view of:
$(A)$ the consolidated financial position and the assets and liabilities of the Transaction Entities (excluding Ever Green) as at the Last Balance Date; and
$(B)$ the consolidated income, expenses, cashflows and operational results of the Transaction Entities (excluding Ever Green) for the financial period ended on the Last Balance Date;
$(2)$ have been prepared:
$(A)$ in compliance with the Corporations Act, the Accounting Standards and all other applicable laws and regulations; and
$(B)$ applying the same principles, policies, practices and procedures as were applied in preparing the equivalent accounts for the previous accounting period;
$(3)$ are not affected by any extraordinary, unusual or non recurring item or any other factor that might make the financial position or operational results of the Transaction Entities (excluding Ever Green) disclosed in the Last Accounts misleading or deceptive in any material respect; and
$(4)$ contain specific provisions adequate to cover, or full particulars in notes of, all liabilities of the Transaction Entities (excluding Ever Green) as at the Last Balance Date including all Tax Funding Liabilities and other liabilities in respect of Tax and other Fees and all contingent liabilities.

$(b)$ Position since 30 June 2008

Other than in respect of the Approved Payments and repayment of Stemcor UK Limited's loan regarding stockpile financing that was repaid, since 30 June 2008:

there has been no change in the financial position, turnover, cash flow, trading $(1)$ performance or prospects of any Transaction Entity which would have a Material Adverse Effect;
$(2)$ each Transaction Entity has carried on the Business in the ordinary and usual course consistent with its usual business practices and has not made any significant change to the nature or scale of any activity comprised in the Business:
no Transaction Entity has issued or allotted any shares or other securities, $(3)$ bought back or redeemed any shares or other securities or otherwise reduced its share capital, declared or paid any dividends or other distributions or authorised, or agreed conditionally or otherwise to do, any of those things other than in relation to the transactions under the Pre-sale Transactions or the Transaction:
no Transaction Entity has disposed of or created any Encumbrance over any $(4)$ material asset except in the ordinary course of business;
other than as fairly disclosed in the Seller Disclosure Materials, no Transaction $(5)$ Entity has incurred or entered into commitments to incur capital expenditure in excess of \$1,000,000 above the level of capital expenditure disclosed in the capital expenditure budget contained in the Sellers Disclosure Materials; and
$(6)$ there has been no material increase or decrease in the levels of debtors, creditors or inventory or in the average collection or payment periods for debtors and creditors of any Transaction Entity and:
$(A)$ no Transaction Entity has defaulted in paying any creditor or financier by the due date for payment; and
no debt owing to any Transaction Entity has been released or settled $(B)$ for an amount less than its full amount.

Reviewed Accounts and management accounts $(c)$

The Reviewed Accounts and the unaudited monthly management accounts of $(1)$ Goldamere Pty Ltd for the month ended 31 July 2008 fairly present the assets, liabilities, income and expenses of the Transaction Entities on an aggregated basis and are not misleading or deceptive in any material respect having regard to the basis of preparation and the purpose for which they were prepared.
$(2)$ The Reviewed Accounts in respect of Ever Green:
$(A)$ have been prepared:
- $i)$ in compliance with all applicable laws and regulations; and
- $\overline{ii}$ applying the same principles, policies, practices and procedures as were applied in preparing the equivalent accounts for the previous accounting period:
$(B)$ are not affected by any extraordinary, unusual or non recurring item or any other factor that might make the financial position or operational results of Ever Green disclosed in the Reviewed Accounts misleading or deceptive in any material respect; and
$(C)$ contain specific provisions adequate to cover, or full particulars in notes of, all liabilities of Ever Green as at the balance date for the Reviewed Accounts including all Tax Funding Liabilities and other liabilities in respect of Tax and other Fees and all contingent liabilities.

$3.7$ Assets, liabilities and financing arrangements

Assets $(a)$

Each of the assets disclosed in or included in the Last Accounts is legally and $(1)$ beneficially owned by a Transaction Entity free of any Encumbrance or other Third Party rights.
$(2)$ Upon Completion, Grange will own or have the right to use all the assets necessary to enable the Transaction Entities to conduct the Business in the manner in which it is conducted at the date of this agreement.

$(b)$ Debts owing to the Transaction Entities

No debt is owing to the Transaction Entities other than trade debts incurred in the ordinary course of business or as fairly disclosed in the Sellers Disclosure Materials and as far as the Ever Green Sellers are aware:

all debts owing to the Transaction Entities disclosed in the Last Accounts have $(1)$ been collected or will be collected in full except to the extent of any provision in the Last Accounts for bad and doubtful debts; and
all other debts owing to the Transaction Entities as at the date of this $(2)$ agreement will be collected in full.

$(c)$ Borrowings

Other than as fairly disclosed in the Sellers Disclosure Materials, no Transaction Entity owes any borrowings or other indebtedness under any bank facility, overdraft, bond, note, debenture, acceptance credit, sale and lease back, derivative instrument or other arrangement providing financial accommodation of any description and:

$(1)$ no Transaction Entity has received any notice requiring the repayment of any such borrowings which are repayable on demand or requiring any such borrowings to be repaid before their due date or derivative instrument closed out for any reason; and
$(2)$ there is no event of default and no other circumstance exists that may entitle any person to require early repayment of any such borrowings or to enforce any security given by any Transaction Entity in respect of any such borrowings or any derivative instrument to be closed out.

$(d)$ Other financial obligations

Other than as provided in the Sellers Disclosure Materials, no Transaction Entity has:

$(1)$ created or provided any Guarantee in relation to the obligations of any person;

$(2)$ created or provided any letter of comfort or made or given any representation, warranty or material undertaking to any person in relation to any liability or the solvency of any other person or in support of the provision of any material loan, credit or other financial accommodation;
$(3)$ entered into any option, swap, exchange or other derivative or hedging transaction which has not been fully closed out; or
$(4)$ entered into any agreement or arrangement for the purpose of obtaining any financial accommodation of a type that is not required to be disclosed as a liability under the Accounting Standards.

$3.8$ Contracts

Unusual, restrictive or onerous contracts $(a)$

No Transaction Entity:

$(1)$ is party to any contract that was entered into outside the ordinary course of business or is not on arm's length terms:
other than as contemplated by the Transaction Agreements, establishes any $(2)$ agency, distributorship, marketing, purchasing, manufacturing or licensing arrangement which restricts or limits the ability of that Transaction Entity to undertake any activity in any place in such manner as it determines; or
$(3)$ as far as the Ever Green Sellers are aware, cannot be performed by that Transaction Entity without undue or unusual expenditure or is expected to result in a loss to that Transaction Entity on completion of performance,

and no Transaction Entity has made or received any offer or proposal that remains open for acceptance and if accepted would result in that Transaction Entity being party to any contract within paragraph (1) above.

Validity $(b)$

As far as the Ever Green Sellers are aware, each material contract to which any Transaction Entity is a party:

$(1)$ is valid, binding and enforceable; and
$(2)$ in respect of such contracts which are provided in the Sellers Disclosure Materials, is valid, binding and enforceable in the form provided in the Sellers Disclosure Materials.

Breach or default $(c)$

No Transaction Entity is in breach of any contract to which it is party and as far as the Ever Green Sellers are aware no other party is in breach of such contract.

Termination $(d)$

At the date of this agreement, no party to any contract to which any Transaction Entity is party has given any notice terminating or purporting to or advising of an intention to terminate that contract and as far as the Ever Green Sellers are aware no circumstance exists that may entitle any person to do so.

Trading relationships $(e)$

No customer of or supplier to any Transaction Entity has at any time in the 12 months before the date of this agreement ceased to deal with that Transaction Entity or materially reduced the level of its custom from or supply to that Transaction Entity or indicated an intention to do so and as far as the Ever Green Sellers are aware no customer or supplier will take any such action as a result of the transactions contemplated by this agreement.

3.9 Real property and environmental

General $(a)$

The Properties comprise all of the real property owned, leased, occupied or used by the Transaction Entities and no Transaction Entity is party to any contract to acquire, lease or occupy any real property other than the Properties.

$(b)$ Freehold properties

Goldamere Pty Ltd is the sole legal and beneficial owner of each Freehold Property, has good and marketable title to each Freehold Property and has in its possession all documents of title to each Freehold Property.

$(c)$ Leasehold properties

True and complete copies of each Lease, each other deed or agreement affecting the terms of that Lease or the fitout of the Leasehold Property subject of that Lease and each notice served under that Lease have been disclosed to Grange in the Sellers Disclosure Materials and except as disclosed there are no incentives, rent free periods, reduced rent periods or other reductions or abatements of rent or outgoings in relation to any of the Leasehold Properties.

$(d)$ Leases

In relation to each Lease:

as far as the Ever Green Sellers are aware the Lease is valid, binding and $(1)$ enforceable and registered where required:
$(2)$ at the time the Lease was entered into, the relevant Transaction Entity entering into the Lease verified that the relevant landlord was the registered proprietor of the property subject to that Lease and was entitled to grant the Lease;
where applicable, each option to extend the Lease has been validly exercised $(3)$ by the relevant Transaction Entity, and the relevant Transaction Entity is not the lessee on an overholding basis;
$(4)$ the relevant Transaction Entity has made all payments required by the Lease, has otherwise complied with all terms of the Lease and all other covenants affecting the property subject of the Lease and has not received any notice alleging that any circumstance exists that may constitute a breach of the Lease; and
$(5)$ the lessor under the Lease has not given any notice terminating or purporting to or advising of an intention to terminate the lease and as far as the Ever Green Sellers are aware no circumstance exists that may entitle the lessor under the Lease to do so.

Encumbrances and Third Party rights $(e)$

Other than as provided in the Sellers Disclosure Materials, all right, title and interest of each Transaction Entity in each of the Properties is held free and clear of any Encumbrance and none of the Properties is subject to any lease, licence, option, caveat,

covenant, easement, overriding interest, restriction, condition, or other right in favour of any Third Party except for any easement registered on title.

$(f)$ Occupation and ancillary rights

Other than as provided in the Sellers Disclosure Materials, each Transaction Entity specified as the registered proprietor of a Freehold Property and as the lessee of a Leasehold Property has exclusive possession, occupation and quiet enjoyment of the land included in the relevant Property and holds any easements, rights, interests and privileges in connection with that land necessary to enable that Transaction Entity to carry on the Business.

$(q)$ Use

As far as the Ever Green Sellers are aware, the use of each of the Properties for carrying on the Business complies with and is permitted by all applicable laws and regulations and the terms of any relevant Lease.

$(h)$ Buildings and improvements

All buildings and improvements on any Property are in a good state of repair and condition and fit for their current use.

$(i)$ Disputes

No Transaction Entity is involved in any dispute with any landlord, tenant, neighbour or other person or with any Regulatory Authority in relation to the Properties or the operation of the Business from the Properties and as far as the Ever Green Sellers are aware no circumstance exists that is likely to give rise to any such dispute.

$(i)$ Nuisance and environmental complaints

The Transaction Entities' operation of the Business from the Properties has not caused and is not causing any nuisance and no Transaction Entity has received in the 12 months before the date of this agreement any complaint about the effects of the Transaction Entities' operations of the Business on the Environment since completion of the Savage River Sale and Purchase Agreement.

$(k)$ Contamination

$(1)$ No Transaction Entity is liable for, and each of the Properties, Freehold Properties and Leasehold Properties is materially free from, the presence in, on or under any air, land or water of any Contamination that might reasonably be expected to cause any Regulatory Authority or any other person to require that Transaction Entity, whether now or in the future:
$(A)$ to clean up, remove, remedy, treat, control or contain, monitor or otherwise manage that Contamination, or contribute to the cost of doing so: or
$(B)$ to pay compensation to any person in respect of that Contamination.
To the extent that any of the Mining Tenements comprises land that is not $(2)$ subject to the indemnity provided in clause 4.2 of the State Agreement, as far as the Ever Green Sellers are aware that land is materially free from the presence in, on or under any air, land or water of any Contamination that might reasonably be expected to cause any Regulatory Authority or any other person to require any Transaction Entity, whether now or in the future:
$(A)$ to clean up, remove, remedy, treat, control or contain, monitor or otherwise manage that Contamination, or contribute to the cost of doing so; or
$(B)$ to pay compensation to any person in respect of that Contamination.

$3.10$ Mining Tenements

General $(a)$

Goldamere Pty Ltd holds legal and beneficial title to the Mining Tenements. $(1)$ free and clear of any Encumbrances (except those disclosed to Grange prior to the date of this agreement).
$(2)$ The Mining Tenements are in good order and standing.
No Transaction Entity is a party to any agreement or arrangement in respect of $(3)$ the Mining Tenements under which it is bound to:
$(A)$ share the profits with or pay any royalties to third parties (other than to the State under the MRD Act and Regulations); or
$(B)$ waive or abandon any rights to which a Transaction Entity may be entitled.
$(4)$ As far as the Ever Green Sellers are aware, no Transaction Entity is, or will become liable, to any Third Party or the State in connection with any act or omission by the Transaction Entity on the Mining Tenements to the extent that such liability arises from the activities of any Transaction Entity on or within a Mining Tenement.

Compliance with Tenement Obligations $(b)$

$(1)$ All operations and activities on, within or in respect of the Mining Tenements have previously been and will continue to be conducted:
$(A)$ in compliance with the terms of the Mining Tenement and the provisions of the MRD Act and Regulation; and
$(B)$ only for Authorised Purposes.
$(2)$ Except where any relevant exemption applies, Goldamere Pty Ltd:
$(A)$ has always previously complied with all Tenement Obligations
$(B)$ is currently complying respects with all Tenement Obligations;
$(C)$ has not received any Tenement Notices; and
$(D)$ is not aware of any circumstances which might give rise to a Tenement Notice being issued.

in respect of the Mining Tenements.

$(3)$ Goldamere Pty Ltd:
$(A)$ has always previously held and fully complied with; and

$(B)$ currently holds and is complying with,

in all material respects, all Approvals in respect of or otherwise relating to the Mining Tenements.

$(4)$ As at the date of this agreement, no notice has been served on Goldamere Pty Ltd or any Transaction Entity in respect of the Mining Tenements which will or might reasonably be likely to:
$(A)$ materially impair, prevent or otherwise interfere in a material respect with the use of or any proprietary rights in the Mining Tenements; or
$(B)$ give rise to a material liability or obligation on the part of any Transaction Entity to the State or any Third Party.

$3.11$ Intellectual property and confidential information

$(a)$ No Intellectual Property Rights

As at the date of this agreement, the Transaction Entities do not own or have an enforceable right to use any material Intellectual Property Rights in respect of the Business.

$(b)$ Payment of royalties

Neither the Ever Green Sellers nor any Transaction Entity pays any royalty or other payment to any Third Party or require the permission of or consent of any Third Party in relation to the use of any Intellectual Property Rights.

No similar business or trade names or marks $(c)$

Neither the Ever Green Sellers nor any Transaction Entity has any knowledge or has received notice of any claims to the effect that any business or trade name or trade mark used or owned by any Transaction Entity and used in the Business is the same as, or is confusingly or deceptively similar to, the name of any other company or any business or trade name or trade mark owned or used by any other person.

$(d)$ Infringement of Third Party rights

As far as the Ever Green Sellers are aware none of the activities of or the processes now or at any time employed or the products now or at any time dealt in by the Business any Transaction Entity infringes or is likely to infringe any Intellectual Property Rights of any Third Party and, in the five (5) years prior to the date of this agreement, neither the Sellers nor any Transaction Entity has been given notice, written or otherwise, of any claim which has been asserted or is or may be pending or threatened by any person in respect of the use or the validity of any Intellectual Property Rights whether registrable or not.

$(e)$ Assignments

Each contractor engaged by any Transaction Entity for the purpose of undertaking any activity that has given rise to or may give rise to the creation of any Intellectual Property Right has executed a valid and binding agreement assigning any such Intellectual Property Right to the relevant Transaction Entity and any employee of any Transaction Entity who has devised any invention which is or may become the subject of any application for a patent or registered design outside Australia has executed an assignment of that invention, and the right to be granted a patent in relation to the invention, to that Transaction Entity.

Confidential Information $(f)$

No Ever Green Seller or any of its Related Bodies Corporate and no Transaction Entity has disclosed to any person other than Grange, a Grange Group Member or Grange's Representatives any Confidential Information except to the extent:

such disclosure was made in the ordinary course of business and where the $(1)$ recipient is either an employee of a Ever Green Seller or any of its Related Bodies Corporate or Transaction Entity which made such disclosure and has acknowledged the confidentiality of the Confidential Information and has agreed neither to use that Confidential Information nor disclose that Confidential Information to any person except for the purpose for which that Confidential Information was disclosed;
to financiers or lawyers, accountants, investment bankers, consultants or other $(2)$ professional advisers of the Ever Green Seller, a Ever Green Seller's Related Entity or a Transaction Entity who are bound by obligations of confidentiality by reason of their role as adviser:
$(3)$ where required or compelled by law; or
the information was already available in the public domain other than by breach $(4)$ of this warranty;
$(5)$ the disclosure was required by applicable law or the rules of any recognised stock exchange on which the disclosing entity's shares or the shares of any of its Related Bodies Corporate are listed or proposed to be listed;
$(6)$ the disclosure was necessary to seek implementation of the Pre-sale Transactions or the Transaction, satisfaction of any of the conditions in clause 2.1 of this agreement or for the purposes of clause 10.3(a) of this agreement. provided that the relevant Governmental Agency is made aware of the confidential nature of the information and was instructed to keep the information secret and confidential and did not divulge or disclose the information to any other person;
the disclosure was to Ever Lucky Development Limited (company number $(7)$ 1405866, incorporated in the British Virgin Islands) in connection with the Transaction; or
with Grange's consent. $(8)$

$3.12$ Systems

Ownership and control $(a)$

The Systems are owned by a Transaction Entity or leased or licensed to a Transaction Entity and (other than software and networks) are under the possession or control of a Transaction Entity and so far as the Ever Green Sellers are aware no circumstance exists at the date of this agreement that may entitle any person to terminate any lease or licence in relation to the Systems.

$(b)$ Support

The Systems (except for the Pulse Mining Systems) are maintained and supported by the relevant manufacturer or authorised reseller in accordance with the manufacturer's recommendations under valid, binding and enforceable support agreements.

$(c)$ Performance

The Systems are performing in all material respects at the date of this agreement and there has been no material unscheduled disruption to or failure in the operation or performance of the Systems in the period of 12 months before the date of this agreement.

$(d)$ Security and integrity

Each Transaction Entity has taken all reasonable commercially available precautions to preserve the security of the Systems and the data and information stored on them and as far as the Ever Green Sellers are aware, in the period of 12 months before the date of this agreement there has been no unauthorised access to the Systems or any of the data or information stored on them.

$3.13$ Employees

Terms of employment $(a)$

The Employees comprise all of the employees of the Transaction Entities as at $(1)$ the date of this agreement.
$(2)$ All employees, other than the employees referred to in paragraph (1), are paid in accordance with the relevant award, Australian Bulk Minerals Workplace Agreement (Tasmania) 2006, an ITEA or AWA lodged with the Workplace Authority.
$(3)$ No obligation in respect of the Transaction Entities' employees, other than pursuant to an award, Australian Bulk Minerals Workplace Agreement (Tasmania) 2006, an ITEA or AWA described in paragraph (1), regarding pay, conditions or employee entitlements is binding on a Transaction Entity. This includes any arrangement under which any employee or former employee of any Transaction Entity has received in the 12 months before the date of this agreement or may be entitled to receive any bonus or other payment or benefit (whether contractual or discretionary) that is calculated by reference to the performance of any Transaction Entity or any division of any Transaction Entity, the performance of the employee or former employee or any combination of these.
$(4)$ The accrued annual leave, long service leave and personal leave entitlements of each employee of each Transaction Entity has been accurately recorded, complies with all legislative and contractual entitlements, and sufficient provision is made in the financial accounts where such provision is required by the Accounting Standards.
$(5)$ The terms and conditions of all policies (including the ABM Cares Manual) and practices (whether contractual or discretionary) that are applicable to employment or the termination of employment of any employee of any Transaction Entity have been complied with by the Transaction Entities and. where required by the Accounting Standards, sufficient provision has been made for any financial obligations that may arise from these policies has been made.
$(6)$ All commitments given to any employee of any Transaction Entity in relation to change of ownership of Ever Green or the transactions contemplated by this agreement have been complied with and met.

$(b)$ Service agreements

$(1)$ True and complete copies of each of the following have been disclosed to Grange in the Sellers Disclosure Materials:
a schedule containing details of the remuneration for each Employee; $(A)$ and
$(B)$ each written agreement for the provision of consultancy services to any Transaction Entity.
$(2)$ Any equity participation plan established by a Transaction Entity since that Transaction Entity's incorporation, has been fully resolved and no Transaction Entity has any outstanding liability for share options to be issued to, or participation plans on which any current or former employee is entitled to participate.

Collective agreements $(c)$

Each Transaction Entity is party to or bound by the Australian Bulk Minerals Workplace Agreement (Tasmania) 2006, a number of ITEAs and AWAs lodged with the Workplace Authority and may be bound by other state or federal awards. No Transaction Entity has any other collective agreement, unregistered ITEAs or AWAs, or other registered or unregistered agreement with any group of employees or any trade union and there are no discussions or negotiations with any employees or trade unions or any of their representatives which would result in any Transaction Entity becoming party to or bound by any other agreement.

$(d)$ Notice periods

Each Transaction Entity that is the employer of any employee is legally entitled to terminate the employment of each of its employees by 1 month's notice or less. Compliance with obligations

Each Transaction Entity has:

$(1)$ paid all amounts due to each employee and former employee other than in respect of remuneration accrued for the current salary payment period and current expense claims:
$(2)$ otherwise complied in all material respects with all of its obligations in relation to the employment of its employees including all obligations arising under any contract, award or collective agreement and all obligations in relation to occupational health and safety and workers' compensation; and
$(3)$ made sufficient provision in the Last Accounts as at the Last Balance Date where such provisions is required by the Accounting Standards:
$(A)$ for all annual leave, long service leave and personal leave entitlements then due to all employees;
$(B)$ to meet any severance payment required; and
$(C)$ to meet any provisions for bonuses (including bonuses payable on the SRRP plan) provided to employees or consultants under any contract, agreement or policy.

Termination $(e)$

In the 6 months preceding the date of this agreement, no employee of or consultant to any Transaction Entity:

has been given notice of dismissal or termination by the relevant Transaction $(1)$ Entity:
$(2)$ has given notice resigning from employment with the relevant Transaction Entity or terminating that consultancy or has otherwise indicated an intention to terminate the employment or consultancy; or
$(3)$ has been placed on gardening leave or any equivalent arrangement,

that would, or would reasonably be likely to, have a Material Adverse Effect on the Transaction Entity.

$(f)$ Disputes

No Transaction Entity is involved in any industrial dispute or other dispute with any trade or industrial union or association, group of employees or individual employee, no such dispute has been threatened and, as far as the Ever Green Sellers are aware, no circumstance exists that is likely to give rise to any such dispute.

$3.14$ Superannuation

$(a)$ Compliance

Each Fund is a complying superannuation fund within the meaning of the Superannuation Industry (Supervision) Act 1993.

$(b)$ Contributions

Each Transaction Entity:

$(1)$ has made when due all contributions in respect of its employees to each Fund that the relevant Transaction Entity is obliged to make under its constituent documents or as required by any employment contract, employment policy or industrial instrument;
$(2)$ has not since the Last Balance Date increased the amount of the contributions to any Fund that the relevant Transaction Entity is obliged to make or has voluntarily committed to make; and
$(3)$ has made the prescribed minimum level of superannuation contributions required to avoid incurring a superannuation quarantee charge under the Superannuation Guarantee Charge Act 1992.

$3.15$ Legal proceedings

$(a)$ Litigation

As at the date of this agreement, other than as disclosed in the Sellers Disclosure Materials:

$(1)$ no Transaction Entity is a claimant or defendant in, or otherwise a party to, any litigation, arbitration or mediation proceedings other than as claimant for the collection of debts not exceeding \$1,000,000, and there are no such proceedings pending or threatened against any Transaction Entity;; and
$(2)$ as far as the Ever Green Sellers are aware no circumstance exists that is likely to give rise to any such proceedings.

$(b)$ Investigations and prosecutions

As at the date of this agreement, other than as fairly disclosed in the Sellers Disclosure Materials:

no Transaction Entity has been notified that it is the subject of any $(1)$ investigation, inquiry, prosecution or enforcement proceedings by any Regulatory Authority; and
$(2)$ as far as the Ever Green Sellers are aware no circumstance exists that is likely to give rise to any such investigation inquiry, prosecution or proceedings.

$(c)$ Orders and judgments

As at the date of this agreement there is no unsatisfied order, judgment or award by a court against any Transaction Entity.

3.16 Insurance

The business risks and assets owned by each Transaction Entity that are material for the conduct of the Business and are of an insurable nature are insured on the terms disclosed in the Insurance Manual.

$3.17$ Tax

Membership of Consolidated Group $(a)$

As at the date of this agreement, each Australian Group Company is a member of the Australian Consolidated Group.

$(b)$ Group Liabilities

All Group Liabilities of the Australian Consolidated Group that have become due and payable in respect of any period during which any Australian Group Company was a member of the Australian Consolidated Group have been paid by the Head Company to the proper Governmental Agency on or before the due date for such payment.

$(c)$ Tax Sharing Agreement

The Tax Sharing Agreement is a valid tax sharing agreement for the purposes of division 721 of the Tax Act and:

$(1)$ all Group Liabilities of the Australian Consolidated Group are covered by the Tax Sharing Agreement; and
each Australian Group Company has paid all amounts required to be paid and $(2)$ satisfied all other obligations under the Tax Sharing Agreement in order to enable each Australian Group Company to leave the Australian Consolidated Group at Completion clear of any Group Liabilities in respect of which the date the Group Liability is due and payable is after Completion in accordance with section 721-35 of the ITAA 1997.

Payments $(d)$

All:

$(1)$ Tax that has become lawfully due and payable by each Transaction Entity; and $(2)$ Tax Funding Liabilities that have become lawfully due and payable by each Australian Group Company.

for all periods up to the time immediately after Completion have been complied with.

$(e)$ Withholding

All amounts required by any Tax Law to be withheld by any Transaction Entity at source have been correctly withheld and accounted for to the proper Governmental Agency.

$(f)$ Returns and assessments

Each Transaction Entity has lodged by the due date all returns and other documents relating to Tax required to be lodged with any Governmental Agency and:

$(1)$ all information contained in those documents was complete and accurate in all material respects and not false, misleading or deceptive in any material respect; and
$(2)$ no dispute exists in relation to any of those documents and as far as the Ever Green Sellers are aware no circumstances exists which might give rise to such a dispute, that will, or would reasonably be likely to, have a Material Adverse Effect on a Transaction Entity.

$(g)$ Penalties

Except as disclosed in the Sellers Disclosure Materials, no Transaction Entity has in the 5 years before the date of this agreement paid or become liable to pay any penalty, fine or interest under any Tax Law relating to Tax in excess of \$250,000.

$(h)$ Investigations and disputes

Except as disclosed in the Sellers Disclosure Materials, no Transaction Entity has in the 5 years before the date of this agreement been the subject of any investigation in respect of Tax or audit in respect of Tax by, or in dispute in respect of Tax with, any Governmental Agency.

$(i)$ Rulings

Complete copies of all rulings, advices, consents, advance opinions and clearances from a Governmental Agency affecting a Transaction Entity (Rulings) have been disclosed to in the Sellers Disclosure Materials and:

$(1)$ all transactions carried into effect in reliance on any Ruling have been implemented in the manner disclosed in the application for the relevant Ruling; and
$(2)$ no Transaction Entity has and no member of the Australian Consolidated Group has taken any action which has or might alter or prejudice any arrangement which has been negotiated with a Governmental Agency or any Tax Ruling which has previously been obtained from or issued by any Governmental Agency.

$(i)$ Records

Each Transaction Entity has retained:

copies of all returns and other documents lodged with any Governmental $(1)$ Agency in relation to Tax which are material including a copy of the consolidated tax returns relating to the Australian Consolidated Group and information necessary to interpret the details contained in the consolidated tax returns to the extent that the information is material and relates to transactions or events that relate to that Transaction Entity;

$(2)$ all records and other documents that a reasonable person in the Transaction Entity's position would expect would be required by that Transaction Entity to calculate income tax liabilities, capital gains, capital losses, net capital gains and net capital losses after Completion; and
$(3)$ all other records and other documents required by any law or regulation relating to Tax to be retained by any Transaction Entity for the requisite period.

$(k)$ Franking accounts

Each Australian Group Company has accurately maintained a franking account in accordance with the Tax Act at all relevant times and:

complete and accurate details of the balance of each such franking account $(1)$ and any existing or pending franking debits have been provided to Grange in the Sellers Disclosure Materials:
$(2)$ each Australian Group Company franked all dividends in accordance with the benchmark franking rule; and
no Australian Group Company will have a franking deficit at Completion. $(3)$

Tainted share capital $(1)$

No Transaction Entity has a tainted share capital account.

Distributions $(m)$

No Australian Group Company has:

$(1)$ paid or credited an amount, transferred any property, made any distribution or loan or forgiven any debt which may be deemed to give rise to a dividend under the Tax Act; or
streamed any distribution or non share dividends for the purposes of division $(2)$ 204 of the Tax Act.

$(n)$ Remuneration and other payments

No Transaction Entity has paid or credited remuneration or an allowance, gratuity or compensation on retirement to an associated person in excess of a reasonable amount allowable as a deduction in computing the taxable income of the relevant Transaction Entity as a result of which deductions claimed or claimable by the relevant Transaction Entity may be denied that will, or would reasonably be likely to, have a Material Adverse Effect on a Transaction Entity.

Loans and debt forgiveness $(o)$

Except as disclosed in the Sellers Disclosure Materials, no Transaction Entity has:

$(1)$ paid or credited an amount on behalf of or for the benefit of an associate, made an advance or loan or loans that may be treated as an amalgamated loan, or forgiven all or part of a debt owed to the relevant Transaction Entity directly or through an interposed entity, in relation to which a dividend may be taken to have been paid or a franking debit may arise under the Tax Act; or

$(2)$ agreed to waive, forgive or otherwise not seek to recover any debt owing by any person.

that will, or would reasonably be likely to, have a Material Adverse Effect on a Transaction Entity.

Capital gains $(p)$

There has been no application of a provision of the Tax Act in respect of any asset acquired or deemed to have been acquired by any Australian Group Company before 20 September 1985 which would result in that asset being deemed to have been acquired by an Australian Group Company before 20 September 1985 (other than as a result of this agreement) and which will still be owned by any Transaction Entity immediately after Completion.

Rollover relief $(q)$

No Transaction Entity has sought capital gains tax rollover relief under the Tax Act with respect to any asset which it has acquired and owns at Completion.

$(r)$ Future income tax benefits

As at the date of this agreement no fact, matter or circumstances exist (excluding in relation to the ability of the Transaction Entities to join the Grange income tax consolidated group) which has prevented or might prevent any Transaction Entity from obtaining any future income tax benefit provided for in the Reference Date Balance Sheet. All tax losses and capital losses recorded in any tax working papers included in the Sellers Disclosure Materials (and whether disclosed in the Reference Date Balance Sheet or not) would be available to a Australian Group Company to use to reduce assessable income or capital gains at the Completion Date if the current Tax Year for the relevant Australian Group Company had sufficient income or capital gains for that Tax Year.

$(s)$ Interposed entity election

No Australian Group Company has made an interposed entity election within the meaning of schedule 2F of the Tax Act.

$3.18$ Disclosure

Reference Date Balance Sheet $(a)$

As at the relevant reference date at which the Reference Date Balance Sheet is provided, all information relating to the Transaction Entities and their assets contained in the Reference Date Balance Sheet is complete, accurate and not misleading in all material respects.

Completeness of Sellers Disclosure Materials $(b)$

$(1)$ The Sellers Disclosure Materials do not include any information that is misleading in any material respect and no information has been omitted from the Sellers Disclosure Materials that would render the Sellers Disclosure Materials misleading in any material respect.
$(2)$ The Ever Green Sellers have disclosed all information that a prospective party in the Grange's position would reasonably require for the purpose of making a decision whether to enter into the Transaction.

$(3)$ As at the date of this agreement, the Ever Green Sellers are not aware of any materially adverse information relating to the Transaction Entities Business that has not been made available to Grange before the date of this agreement.

Grange Warranties $\overline{4}$

$4.1$ No legal impediment

The execution, delivery and performance by Grange of the Transaction Agreements:

complies with its constitution or other constituent documents; and $(a)$
$(b)$ does not constitute a breach of any law or obligation, or cause or result in a default under any agreement, or Encumbrance, by which it is bound and that would prevent it from entering into and performing its obligations under the Transaction Agreements.

$4.2$ Corporate Authorisations

All necessary authorisations for the execution, delivery and performance by Grange of the Transaction Agreements in accordance with their terms have been obtained or will be obtained before Completion.

4.3 Power and capacity

Grange has full power and capacity to own its own assets and to enter into and perform its obligations under the Transaction Agreements.

$4.4$ Incorporation

Grange is validly incorporated, organised and subsisting in accordance with the laws of its place of incorporation.

4.5 Grange Group Members

Each Grange Group Member:

$(a)$ is duly incorporated under the laws of the place of its incorporation;
$(b)$ has the power to own its assets and carry on the Grange Group Business as it is being carried on at Completion;
is duly registered and authorised to do business in those jurisdictions that, by the nature $(c)$ of its business and assets, makes registration or authorisation necessary; and
has conducted the Grange Group Business in compliance with the constitution or other $(d)$ constituent documents of that Grange Group Member.

4.6 No trust

Grange enters into and performs the Transaction Agreements on its own account and not as trustee for or nominee of any other person.

4.7 Enforceability

Grange's obligations under the Transaction Agreements are enforceable in accordance with its terms.

4.8 No material proceedings

No Grange Group Member is as at the date of this agreement a party to, and has not in the preceding 5 years been a party to, any investigation, prosecution, or litigation, legal proceedings, arbitration, mediation or any other form of litigation or dispute resolution process or administrative or governmental proceedings that will, or would reasonably be likely to, have a Material Adverse Effect on Grange (Material Proceedings).

4.9 No threatened material proceedings

So far as Grange is aware, as at the date of this agreement no Material Proceedings against a Grange Group Member are pending or threatened and Grange is not aware of any disputes that will, or would reasonably be likely to, give rise to any Material Proceedings.

4.10 No outstanding orders

There are no outstanding settlements, judgments, decrees, awards, orders or other decisions of any court, quasi-judicial body or Governmental Agency (including any competition authority) made against Grange Group Member that will, or would reasonably be likely to, have a Material Adverse Effect on Grange.

4.11 Undertakings

No Grange Group Member has given an undertaking or written assurance (whether legally binding or not) to any court or Governmental Agency (including any competition authority) under any anti-trust or similar legislation in any jurisdiction.

4.12 Compliance with laws

Each Grange Group Member has complied in all material respects with applicable laws $(a)$ and administrative requirements, where non-compliance will, or would reasonably be likely to, have a Material Adverse Effect on Grange.
Grange has complied with its disclosure obligations under Listing Rule 3.1. $(b)$

Authorisations 4.13

The Grange Disclosure Materials contain a list of all the Authorisations that a Grange Group Member holds or has applied for and such Authorisations are all the Authorisations that are material to conduct the Grange Group Business as it is being carried on at Completion (Material Authorisations).

4.14 Compliance with Authorisations

All Material Authorisations have been complied with in all material respects by the relevant Grange Group Member.

4.15 Termination

The transactions contemplated by the Transaction Agreements will not trigger a termination of any Material Authorisation that will, or would reasonably be likely to, have a Material Adverse Effect on Grange.

4.16 No revocations

Grange is not aware of any action to revoke, prevent the renewal of or impose any conditions on any Material Authorisation.

4.17 No prejudice of Material Authorisations

Grange is not aware of any thing that might prejudice the continuance, renewal, issue or extension of a Material Authorisation.

4.18 Compliance

Each Grange Group Member has obtained, maintained in force, and during the 5 years before Completion complied with, all Material Authorisations required by it to conduct the Grange Group Business.

4.19 This agreement

So far as Grange is aware, neither the execution nor performance of the Transaction Agreements or any document to be executed at or before Completion will:

result in a Grange Group Member losing the benefit of a Material Authorisation or an $(a)$ asset, grant, subsidy, right or privilege that it enjoys at the date of this agreement in any jurisdiction; or
$(b)$ conflict with, or result in a breach of, or give rise to an event of default under, or require the consent of a person under, or enable a person to terminate, or relieve a person from an obligation under, an agreement, arrangement or obligation to which a Grange Group Member is a party or a legal or administrative requirement in any jurisdiction; or
$(c)$ result in any customer being entitled to or, so far as Grange is aware, cease dealing with a Grange Group Member or substantially to reduce its existing level of business or to change the terms upon which it deals with a Grange Group Member; or
$(d)$ result in any supplier being entitled to or, so far as Grange is aware, cease supplying to a Grange Group Member or substantially to reduce its supplies to or to change the material terms upon which it supplies a Grange Group Member.

4.20 Disclosure

$(a)$ Grange has disclosed all information that a prospective party in the Sellers' positions would reasonably require for the purpose of making a decision whether to enter into the Transaction.
$(b)$ The Grange Disclosure Materials do not include any information that is misleading in any material respect and no information has been omitted from the Grange Disclosure Materials that would render the Grange Disclosure Materials misleading in any material respect.

4.21 Information provided

As at the date of this agreement, Grange is not aware of any materially adverse $(a)$ information relating to the Grange Group Business that has not been made available to the Sellers before the date of this agreement.
$(b)$ No information (other than the Seller Information) contained in the Grange NOM, as at the date the Grange NOM is despatched to Grange Shareholders, will contain any statement which is materially misleading or deceptive, including by way of omission from that statement.
Grange has not provided the Sellers with any information which should have been $(c)$ disclosed to the market in compliance with Listing Rule 3.1, but which has not.

4.22 Tax paid

Any Tax or Duty arising under any Tax Law payable in respect of any transaction, income or assets of a Grange Group Member for all periods up to the time immediately after Completion will have been paid.

4.23 Provision in Accounts

Adequate provision has been made in the Grange Group Accounts for any Tax for which a Grange Group Member is liable but which is unpaid in respect of any transaction or event occurring or income derived up to and including the Accounts Date.

4.24 Withholding tax

Any obligation on a Grange Group Member under any Tax Law to withhold amounts at source has been complied with.

4.25 No capital gains tax relief

No Grange Group Member has sought capital gains tax relief under sub-division 126-B of the ITAA 1997 or section 160ZZO of the ITAA 1936 in respect of any asset acquired by any Grange Group Member and that is still owned by any Grange Group Member immediately after Completion.

4.26 Records

Each Grange Group Member has maintained proper and adequate records to enable it to comply in all material respects with its obligations to:

$(a)$ prepare and submit any information, notices, computations, returns and payments required in respect of any Tax Law;
$(b)$ prepare any accounts necessary for compliance with any Tax Law; and
$(c)$ retain necessary records as required by any Tax Law.

So far as Grange is aware, such records are accurate in all material respects.

4.27 Returns submitted

Each Grange Group Member has submitted any necessary information, notices, computations and returns to the relevant Governmental Agency in respect of any Tax or any Duty relating to the Grange Group Members.

4.28 No Tax audit

Grange is not aware of any pending or threatened Tax or Duty audit relating to a Grange Group Member.

4.29 No disputes

There are no disputes between a Grange Group Member and any Governmental Agency in respect of any Tax or Duty.

4.30 Franking credits

$(a)$ No Grange Group Member will have a franking account deficit immediately after Completion. No act or omission of a Grange Group Member at or before Completion will cause any Grange Group Member to be liable for franking tax immediately after Completion.
$(b)$ There will not be any franking debit to any Grange Group Member's franking account after Completion that relates to a transaction or arrangement entered into at or before Completion.

4.31 Stamping

All documents and transactions entered into by a Grange Group Member that are required to be stamped have been duly stamped.

4.32 No tainting

The share capital account of each Grange Group Member is not 'tainted' within the meaning of section 160ARDM of the ITAA 1936.

4.33 GST

Each Grange Group Member has complied in all material respects with all laws, contracts, agreements or arrangements binding on it relating to GST and, where a Grange Group Member has the right to require another party to any such agreement or arrangement to pay to it an amount on account of GST, it has enforced that right.

4.34 Contracts

There is no agreement or arrangement requiring Grange to supply anything which does not contain a provision enabling it, as supplier, to require the other party to the agreement or arrangement to pay to Grange the amount of any GST payable on a supply under that agreement or arrangement in addition to the consideration otherwise payable for that supply;

4.35 Tax Invoices

There is no agreement or arrangement requiring Grange to pay any GST on a supply which does not contain a provision enabling it, as recipient, to require the other party to the contract agreement or arrangement to provide to Grange a tax invoice for any GST on that supply before that payment is required.

Schedule 2

Schedule of Capital

Ever Green $\overline{1}$

Security holder	Number of fully paid ordinary shares	Percentage of total issued capital in Ever Green held by security holder
Shagang	2,040,000	68%
RI	600,000	20%
DI	360,000	12%
Total	3,000,000	100%

SMAPL $\overline{2}$

Security holder	Number of fully paid ordinary shares	Percentage of total issued capital in SMAPL held by
		security holder
Ever Green	18,000,000	90%
Stemcor	2,000,000	10%
Total	20,000,000	$100\%$

$\mathfrak{Z}$ Beviron Pty Ltd

Security holder	Number of fully paid	Percentage of total issued
	ordinary shares	capital in Beviron Pty Ltd
		held by security holder
SMAPL	95,215,085	100%
Total	95,215,085	$100\%$

$\bar{\nu}$

$\ddot{\phantom{0}}$

Goldamere Pty Ltd $\overline{4}$

$\hat{\mathcal{A}}$

$\sim$

Security holder	Number of fully paid ordinary shares	Percentage of total issued capital in Goldamere Pty Ltd
		held by security holder
Beviron Pty Ltd	11,000,100	$100\%$
Total	11.000.100	100%

	PI
sign here ►	Signed for Pacific International Co. Pty Ltd By its attorney
	Attorney
print name	CHEUNG CLEMENT Ko
	in the presence of
sign here >	Witness
print name	Yıu CHAN KWONG

Stemcor

Signed by the attorney of Stemcor Pellets Limited under power of attorney and who has received no notice of the revocation of the power, in the presence of:

Uan MIZ. . . . . . . . . . . . . .

Signature of witness

JENNIFFR CHASE $\cdots$ Name of witness (print)

Signature of attorney

...................................... Name of attorney (print)

Grange

Signed for and on behalf of Grange Resources Limited by Vivien Hui, its Attorney under a Power of Attorney dated 23 September 2008 and the Attorney declares that the Attorney has not received any notice of the revocation of such Power of Attorney, in the presence of:

Signature of Witness

Name of Witness in full

Signature of Attorney

VIVIEN WING YOU HAI Name of Attorney in full

Shagang Guarantor

Signed by Shagang International (Hong Kong) Co., Ltd by

WENMING

U sign here /Director

SHEN print name

Share Sale Agreement

RI Guarantor

Signed by RGL International Co., Ltd by

sign here Authorised Representative

SHEN WENMING print name

Stemcor Guarantor

Signed by the attorney of Stemcor Holdings Limited under power of attorney and who has received no notice of the revocation of the power, in the presence of:

والأمام

Signature of witness

JENNIFERCHASE Name of witness (print)

Signature of attorney

JOHN. HELLINIKAKIS ili.
Lin Name of attorney (print)

Annexure C

Shagang International Holdings Limited

This is Annexure C of 24 pages referred to in Form 603 "Notice of Initial Substantial Holder" signed by me and dated $\angle$ January 2009.

The attached document is certified as a true copy.

sign here

print name Shen Bin/Director

Agreement

Merger Implementation Agreement

Great Period Limited

Grange Resources Limited

QV.1 Building 250 St Georges Terrace Perth WA 6000 Australia
GPO Box U1942 Perth WA 6845 Australia

Telephone +61 8 9211 7777 Facsimile +61 8 9211 7878 www.freehills.com DX 104 Perth

	Table of contents
	The agreement
	Operative part	2
	Definitions and interpretation	2
1.1	Agreement components
1.2 1.3	Definitions Interpretation provisions
1.4	Inclusive expressions
	Agreement to proceed with the Transaction	6
	Integration Plan	6
	Implementation steps	7
4.1	Grange's obligations
4.2 4.3	Shagang's obligations Obligations for Grange and Shagang
	Termination	9
5.1	Termination by parties
5.2 5.3	Termination Effect of termination
	No-shop obligation
6.1	No solicitation
6.2	Limitation
6.3	Notification
	Payment of costs	10
7.1 7.2	Background Payment of costs incurred by Shagang
7.3	Payment of costs incurred by Grange
7.4	No break fee
7.5	Other claims
	Public announcement	12
8.1 8.2	Announcement of Transaction Public announcement and submissions
8.3	Required disclosure
	Board of directors and corporate governance	13
9.1	General
9.2	Board

$\bar{z}$

	9.3 9.4	Key executives Corporate governance
10		Southdown Off-Take	15
	General		16
	11.1	No representation or reliance
	11.2	No merger
	11.3	Prohibition and enforceability
	11.4	Severability
	115	Consents
	11.6	Notices
	11.7	Service of process
	11.8	Governing law and jurisdiction
	11.9	Waivers
		11.10 Variation
		11.11 Assignment
		11.12 Further action
		11.13 Entire agreement
		11.14 Counterparts

Signing page

The agreement

Merger Implementation agreement

Date $\blacktriangleright$

Between the parties
Shagang	Great Period Limited (soon to be named Shagang International Holdings Limited) registration number 1497243 of PO Box 957, Offshore Incorporations Centre, Road Town, Tortola, British Virgin Islands (Shagang)
Grange	Grange Resources Limited ACN 009 132 405 of Level 11, 200 St Georges Terrace, Perth WA 6000 (Grange)
Background	Shagang, RI and PI hold all the issued shares of Ever Green. 1 Ever Green and Stemcor hold all the issued shares of SMAPL. 2 Under the Transaction, Shagang, RI and PI will sell their shares in 13 Ever Green, and Stemcor will sell its shares in SMAPL, to Grange in exchange for Grange Shares. Grange and Shagang have agreed in good faith to implement the 4 Transaction on the terms of this agreement.
The parties agree	as set out in the operative part of this agreement, in consideration of, among other things, the mutual promises contained in this agreement.

$\bar{\mathcal{A}}$

$\mathcal{A}^{\mathcal{A}}$

Operative part

Definitions and interpretation $\overline{1}$

$1.1$ Agreement components

This agreement includes any schedule.

$1.2$ Definitions

The meanings of the terms used in this document are set out below.

Term	Meaning
ABM	Goldamere Pty Ltd ACN 073 634 581 (a wholly owned subsidiary of Beviron Pty Ltd ACN 078 197 323), a company trading under the name "Australian Bulk Minerals".
ABM Off-Take	iron ore pellets and chips produced at ABM's mining operations in Savage River, Tasmania.
ABM Off-Take Arrangements	existing arrangements (as at the date of this agreement) in respect of the ABM Off- Take between Shagang and ABM.
ASIC	the Australian Securities and Investments Commission.
ASX	the Australian Securities Exchange operated by ASX Limited (ACN 008 624 691).
Available Southdown Off-Take	the Southdown Off-Take, excluding the 30% of that production to which Sojitz is entitled under the Sojitz Joint Venture Agreement.
Business Day	a day on which banks are open for business in Perth, other than a Saturday, Sunday or public holiday in Perth.
Claim	has the meaning given to that term in the SSA.
Completion	has the meaning given to that term in the SSA.

Term	Meaning
Conditions Precedent	the conditions precedent set out in clause 2 of the SSA.
Confidentiality Agreement	the confidentiality agreement dated 24 December 2007 between Grange and Ever Green Resources Co., Ltd (formerly, Shagang Mining Company Limited (Hong Kong)).
Corporations Act	the Corporations Act 2001 (Cth).
Ever Green	Ever Green Resources Co., Ltd registration number 1133902.
Ever Green Sellers	RI, PI and Shagang.
Grange Board	the board of directors of Grange.
Grange Group	Grange and each of its Related Bodies Corporate (other than the Transaction Entities) and Grange Group Member means any member of Grange Group.
Grange NOM	a notice of meeting and explanatory memorandum (including the Independent Expert's Report and any accompanying documents) convening an extraordinary general meeting of Grange to approve the Transaction.
Grange Shareholders	the shareholders of Grange.
Grange Shares	fully paid ordinary shares of Grange.
Independent Expert's Report	a report prepared by a suitably qualified independent expert stating whether the Transaction is fair and reasonable to Grange Shareholders.
Indicative Timetable	means the indicative timetable as agreed by Shagang and Grange.
Listing Rules	the official listing rules of the ASX.
No-Shop Period	the period from and including the date of this agreement to the earlier of: the termination of this agreement in accordance with its terms; and 1 31 December 2008. 2
Off-Take Resolutions	the resolutions described in clause $4.1(b)(2)$ .

$\sim 10^{-1}$

Term	Meaning
Proposal	any offer or proposal in respect of any transaction (by joint venture, purchase, merger, amalgamation, arrangement, business combination, liquidation, dissolution, recapitalisation, takeover bid or otherwise) that would, if completed substantially in accordance with its terms, result in:
	in respect of Grange: 11.
	(a) a third party acquiring more than 50% of the issued share capital in Grange; or
	Grange disposing of or charging 50% or more of its interest in its material (b) assets: and
	in respect of a Transaction Entity: 12
	a third party acquiring any of the issued share capital in that Transaction (a) Entity; or
	(b) that Transaction Entity disposing any of its interest in its material assets.
Regulatory Approval	all regulatory approvals, permits and licences required in Australia, the People's Republic of China or Hong Kong in order to carry out the Transaction, including those approvals set out in clause 2.1(a) and (b) of the SSA.
Reimbursement Amount	\$2,500,000.
Related Body Corporate	has the meaning given in section 9 of the Corporations Act.
RI	Peak Scale Investments Limited (soon to be named RGL Holdings Co., Ltd) registration number 1497715.
PI	Pacific International Co. Pty Ltd ACN 133 363 265.
Sellers	the Ever Green Sellers and Stemcor.
Shagang Group	Shagang and each of its Related Bodies Corporate (other than the Transaction Entities) and Shagang Group Member means any member of the Shagang Group.
Seller Information	information regarding the Sellers, the Transaction Entities and ABM provided by the Sellers and the Transaction Entities to Grange for inclusion in the Grange NOM.
SMAPL	Shagang Mining (Australia) Pty Ltd ACN 124 436 335.
Sojitz	Sojitz Resources & Technology Pty Ltd (ABN 91 125 884 326).

Term	Meaning
Sojitz Joint Venture Agreement	the Joint Venture Implementation Agreement dated 1 June 2007 between Grange and Sojitz Australia Limited (ABN 16 000 213 132) on behalf of Sojitz.
Southdown Off-Take	the entire production of iron ore pellets and concentrate from the Southdown Magnetite (Iron Ore) Project located near Albany in Western Australia (WA) in which Grange holds a controlling interest.
SSA	the sale and purchase agreement dated on the same date as this agreement entered into between Grange and the Sellers relating to the sale by the Sellers of the Sale Shares (as that term is defined in the SSA) in exchange for Grange Shares.
Stemcor	Stemcor Pellets Limited registered no. 2188847.
Superior Proposal	a Proposal which is: 1 on terms that are not less favourable to Grange than the Transaction; and I2 from a financial perspective, is superior for Grange compared to the Transaction.
Transaction	the transactions contemplated under this agreement and the SSA.
Transaction Agreements	this agreement, the Confidentiality Agreement and the SSA.
Transaction Entities	Ever Green and each of its subsidiaries which are, as at the date of this agreement: SMAPL; l1. 2 Beviron Pty Ltd ACN 078 197 323; and 3 Goldamere Pty Ltd ACN 073 634 581, and Transaction Entity means any of them.
Warranties	has the meaning given to that term in the SSA.

$1.3$ Interpretation provisions

In this agreement headings and words in bold are inserted for convenience and do not affect the interpretation of this agreement and unless the contrary intention appears:

$(a)$ a reference to this agreement or another instrument includes any variation or replacement of any of them;
$(b)$ a reference to a statute, ordinance, code or other law includes regulations and other instruments under it and consolidations, amendments, re-enactments or replacements of any of them;
$(c)$ the singular includes the plural and vice versa;
$(d)$ the word 'person' includes a firm, a body corporate, an unincorporated association or an authority;
a reference to a person includes a reference to the person's executors, administrators, $(e)$ successors, substitutes (including persons taking by novation) and assigns;
if a period of time is specified and dates from a given day or the day of an act or event, it $(f)$ is to be calculated exclusive of that day;
a reference to a day is to be interpreted as the period of time commencing at midnight $(g)$ and ending 24 hours later;
$(h)$ if an act prescribed under this agreement to be done by a party on or by a given day is done after 5.00pm on that day, it is taken to be done on the next day;
if an event must occur on a stipulated day that is not a Business Day then the stipulated $(i)$ day will be taken to be the next Business Day;
$(i)$ a reference to time is a reference to Perth time:
a reference to any thing (including any amount) is a reference to the whole and each part $(k)$ of it and a reference to a group of persons is a reference to any one or more of them;
$(1)$ a reference to a part, clause, party, attachment, exhibit or schedule is a reference to a part and clause of, and a party, attachment, exhibit and schedule to, this agreement and a reference to this agreement includes any attachment, exhibit and schedule; and
a reference to \$ is to Australian currency unless denominated otherwise. $(m)$

$1.4$ Inclusive expressions

$\overline{2}$ Agreement to proceed with the Transaction

The parties will undertake the Transaction on the terms of this agreement.

3 Integration Plan

$(a)$ Following execution of this agreement, Grange and Shagang will work together to develop a plan of actions and steps to be carried out before Completion that will assist in the implementation of the Transaction following Completion (Integration Plan).
$(b)$ Once the Integration Plan is agreed, the parties must use all reasonable endeavours to implement the Integration Plan and perform the obligations referable to it or its subsidiaries under the Integration Plan before Completion.

Implementation steps 4

$4.1$ Grange's obligations

Grange must take all necessary steps to implement the Transaction as soon as is reasonably practicable, including each of the following:

Commission Independent Expert's Report: in consultation with Shagang, commission $(a)$ the preparation of the Independent Expert's Report stating whether or not, in the opinion of the expert, the Transaction and the ABM Off-Take Arrangements are fair and reasonable to non-associated Grange Shareholders, and setting out the reasons for that opinion.
$(b)$ Preparation of Grange NOM: prepare the Grange NOM which must include:
a statement by each Grange director recommending that Grange Shareholders $(1)$ vote in favour of the Transaction in the absence of a Superior Proposal in accordance with clause 4.1(h), in accordance with all applicable laws and in particular with the Corporations Act and the Listing Rules:
$(2)$ resolutions to obtain any Grange Shareholder approvals required under applicable laws (and in particular the Corporations Act and the Listing Rules) in relation to the ABM Off-Take Arrangements (Off-Take Resolutions); and
$(3)$ a statement by each Grange director recommending that Grange Shareholders vote in favour of the Off-Take Resolutions (if required under applicable laws (including the Corporations Act and Listing Rules)) in the absence of a Superior Proposal in accordance with clause 4.1(h), in accordance with all applicable laws and in particular with the Corporations Act and the Listing Rules.
$(c)$ Consultation with Shagang: must consult in good faith with Shagang as to the content and presentation of the Grange NOM. This consultation must include obtaining Shagang's consent to the inclusion of the Seller Information.
Provide Grange NOM: as soon as practicable after Grange has completed the $(d)$ preparation of the final form of the Grange NOM, forward a copy to Shagang for review and consider in good faith any amendments proposed by Shagang.
Meeting of directors of Grange: as soon as practicable after preparation of the final $(e)$ form of the Grange NOM, convene a meeting of the Grange Board for the purpose of approving the Grange NOM.
$(f)$ Despatch Grange NOM: despatch the Grange NOM to the Grange Shareholders.
Inform Grange Shareholders of relevant post-Grange NOM information: if it becomes $(g)$ aware of information after the date of despatch of the Grange NOM which is material for disclosure to Grange Shareholders, inform Grange Shareholders of that information in an appropriate and timely manner, provided that Grange must consult with Shagang and reasonably consider Shagang's views on the form and content of any correspondence with Grange Shareholders in relation to such matters.
$(h)$ Grange directors' recommendation: provided that the Independent Expert's Report expresses the opinion that the Transaction is "fair and reasonable" to non-associated Grange Shareholders, procure from each Grange director a recommendation to Grange Shareholders to:
$(1)$ vote in favour of the Transaction: and
$(2)$ vote in favour of the Off-Take Resolutions (if required under applicable laws (including the Corporations Act and Listing Rules)).

in the absence of a Superior Proposal and procure that none of the directors of Grange change or withdraw their recommendation prior to obtaining such shareholder approval in the absence of a Superior Proposal.

$(i)$ Grange Shareholders meeting and approval: convene a meeting of Grange Shareholders to:

$(1)$ approve the Transaction; and
$(2)$ approve the Off-Take Resolutions (if required under applicable laws (including the Corporations Act and Listing Rules)),

and seek the approval of Grange Shareholders to the Transaction and the Off-Take Resolutions (if required under applicable laws (including the Corporations Act and Listing Rules)).

$4.2$ Shagang's obligations

Shagang must, and must procure that the Sellers must:

$(a)$ Seller Information: as soon as practicable after the date of this agreement, prepare and provide to Grange, for inclusion in the Grange NOM, the Seller Information in a form, and to the level of detail, reasonably required by Grange (giving consideration to any applicable laws and the Listing Rules); and
assistance: give all necessary assistance which Grange may reasonably require to $(b)$ implement the Transaction as soon as reasonably practicable.

4.3 Obligations for Grange and Shagang

The parties must:

Consultation on communication with ASX or ASIC: consult with each other in relation $(a)$ to communications with ASX or ASIC for the purposes of implementing the Transaction.
Best endeavours to achieve Indicative Timetable: each use its best endeavours and $(b)$ co-operate with the other party to achieve the Indicative Timetable.
Promotion of the Transaction: subject to the parties' confidentiality obligations with $(c)$ respect to the Transaction, each use its best endeavours to co-operate with the other party to promote the Transaction to Grange Shareholders, including but not limited to procuring that upon reasonable request from any party, directors and executives of each party attend and participate in roadshows and presentations promoting the Transaction to market participants and Grange Shareholders.

Termination 5

$5.1$ Termination by parties

A party (Non-defaulting Party) may terminate this agreement at any time by notice in writing to the other party (Defaulting Party) if the Defaulting Party is in breach, in any material respect, of any of their obligations under this agreement, and that breach is not remedied within 5 Business Days of being informed in writing of the breach.

$5.2$ Termination

This agreement terminates immediately upon the SSA being terminated in accordance with its terms.

$5.3$ Effect of termination

If this agreement is terminated under clause 5.1, then:

the parties will procure that each Transaction Agreement (if permitted by the terms of that $(a)$ contract) that has already been executed is terminated in accordance with its terms;
$(b)$ each party is released from its obligations to further perform its obligations under any Transaction Agreement, except those expressed to survive termination;
each party retains the rights it has against the other party in respect of any breach of this $(c)$ agreement occurring before termination;
$(d)$ each party must return to the other party all documents and other materials obtained from that party in accordance with the terms of the Transaction Agreements; and
the rights and obligations of each party under clauses 1, 7 and 10 will continue $(e)$ independently from the other obligations of the parties and survive termination of this agreement.

6 No-shop obligation

$6.1$ No solicitation

During the No-Shop Period, Grange and Shagang each agrees it will not, and will ensure its employees, officers, agents or advisers do not:

$(a)$ directly or indirectly solicit, invite, encourage or initiate any negotiations or discussion with any other party:
$(b)$ negotiate with or enter into or permit discussions with any other party; or
allow any other party to continue, commence or conduct any due diligence investigations $(c)$ in relation to the Grange Group or any Transaction Entity (as appropriate),

in relation to any Proposal by any party other than in respect of the Transaction.

$6.2$ Limitation

The restrictions in clauses $6.1(b)$ and $6.1(c)$ above do not apply to the extent that they restrict Grange or the board of Grange from taking or refusing to take any action in respect of a bona fide Proposal of a person other than a Shagang Group Member (which was not encouraged, solicited, initiated or invited by Grange in breach of clause 6.1(a)) as long as the board of Grange has determined, in good faith and acting reasonably and after receiving written legal advice from its external lawyers, that failing to respond to that competing Proposal would constitute a breach of the directors' fiduciary or statutory obligations.

6.3 Notification

During the No-Shop Period, in the event that Grange receives an approach in relation to a Proposal from any person or entity other than Shagang, it will, as soon as practicable, notify Shagang of the details of that approach (including the identity of the persons or entities involved in the Proposal) and the terms of the Proposal. In these circumstances, Grange will provide Shagang with regular updates on the status of discussion with any such person or entity, including promptly notifying Shagang of the details of any material developments in relation the Proposal. Notwithstanding clause 6.2 above, during the No-Shop Period Grange must not enter into any agreement or arrangement to support, pursue or effect a Proposal by any party unless it has given Shagang an opportunity to make a further offer, and if Shagang makes an offer on terms no less favourable than the other Proposal within 5 business days of receiving notice of the competing Proposal, Grange shall be bound by clause 6.1 above.

$\overline{7}$ Payment of costs

$7.1$ Background

$(a)$ Grange and Shagang acknowledge that, if they enter into this agreement and the Transaction is subsequently not implemented, each of Shagang and Grange will incur significant costs.
In the circumstances referred to in clause 7.1(a), Shagang has requested that provision $(b)$ be made for the payments outlined in clauses 7.2, without which Shagang would not have entered into this agreement.
The Grange Board believes that the Transaction will provide benefit to Grange and $(c)$ Grange Shareholders and that it is appropriate for Grange to agree to the payments referred to in this clause 7 in order to secure Shagang's participation in the Transaction.
$(d)$ In the circumstances referred to in clause $7.1(a)$ . Grange has requested that provision be made for the payments outlined in clause 7.3, without which Grange would not have entered into this agreement.
$(e)$ The parties acknowledge that the Reimbursement Amount is reasonable in the context of the Transaction and fair compensation for the costs, expenses and losses which Shagang or Grange (as the case may be) will incur in connection with the Transaction if it

is unsuccessful, having regard to Shagang's or Grange's (as the case may be) reasonable costs, expenses and losses.

$7.2$ Payment of costs incurred by Shagang

Subject to clauses 7.2(c) and 7.4, Grange must pay to Shagang as compensation for the $(a)$ reasonable costs, expenses and losses incurred by Shagang in proposing and implementing the Transaction an amount equal to the Reimbursement Amount if between entering into this agreement and 31 December 2008 any of the following circumstances occur:
any Grange director fails to recommend that Grange Shareholders vote in $(1)$ favour of the Transaction, or any Grange director having made a recommendation in favour, makes a public statement which withdraws, revises, revokes or qualifies that recommendation (whether or not that failure, withdrawal, revocation, qualification or revision is otherwise in breach of the Transaction Agreements) and the Transaction does not complete;
$(2)$ any Grange director recommends, promotes or otherwise endorses a competing Proposal or any other Proposal (including an internal restructure) or offer and the Transaction does not complete;
$(3)$ a person other than Shagang, or an associate of Shagang, acquires control of Grange or any of its subsidiaries or acquires an interest in all or a substantial part of the assets of Grange and its subsidiaries, other than Sojitz's existing rights to be transferred property under the Sojitz Joint Venture Agreement and the Transaction does not complete; or
$(4)$ Grange is in material breach of its obligations under the Transaction Agreements, and that breach is not remedied within 5 Business Days of being informed by Shagang in writing of the breach, and the Transaction does not complete directly or indirectly as a result of the breach.
The Reimbursement Amount must be paid by Grange to Shagang within 5 Business $(b)$ Days upon a written demand being made by Shagang at any time after the occurrence of any of the events referred to in clause 7.2(a).
$(c)$ Subject to clause 7.2(d), Grange is not required to pay the Reimbursement Amount where the Independent Expert's Report concludes that the Transaction is not fair and reasonable to non-associated Grange Shareholders, except in circumstances where the independent expert would have formed the view that the Transaction was fair and reasonable but for a competing Proposal or any other Proposal (including an internal restructure).
$(d)$ Clause 7.2(c) will only apply to the circumstances set out in clauses 7.2(a)(1) and 7.2(a)(2) if a change, withdrawal, or qualification of a Grange director's recommendation or the recommendation, promotion or endorsement of a competing Proposal occurs after Grange makes a public announcement of the conclusions in the Independent Expert's Report.

$7.3$ Payment of costs incurred by Grange

Subject to clause 7.4, Shagang must pay to Grange as compensation for the reasonable $(a)$ costs, expenses and losses incurred by Grange in proposing and implementing the Transaction an amount equal to the Reimbursement Amount if Shagang is in material

6.004144389.1

breach of its obligations under the Transaction Agreements, that breach is not remedied within 5 Business Days of being informed in writing of the breach; and the Transaction does not complete directly or indirectly as a result of the breach.

$(b)$ The Reimbursement Amount must be paid by Shagang to Grange within 5 Business Days upon a written demand being made by Grange at any time after the occurrence of the event referred to in clause 7.2(a).

$7.4$ No break fee

Neither Grange nor Shagang is required to pay the Reimbursement Amount under $(a)$ clauses 7.2 or 7.3 (as the case may be) if Completion does not occur as a result of any of the Conditions Precedent not being satisfied or waived on or before 31 December 2008.
$(b)$ Clause 7.4(a) does not apply:
$(1)$ in respect of a party that is in material non-compliance with its obligations under the Transaction Agreements; or
$(2)$ where any of the Conditions Precedent are not satisfied directly or indirectly due to the actions or omissions of Grange, Shagang or their directors in circumstances where the Reimbursement Amount is payable by Grange or Shagang under clauses 7.2 or 7.3 (as the case may be).

$7.5$ Other claims

This clause 7 does not limit the rights of Grange or Shagang in respect of any other claims that may arise under this agreement and does not limit the parties' recourse to further amounts being payable under the Transaction Agreements.

Public announcement 8

$8.1$ Announcement of Transaction

Immediately after the execution of this agreement, Grange must issue a public announcement in a form approved by Grange and Shagang which announcement must include:

$(a)$ a unanimous recommendation by the directors of Grange to Grange Shareholders that the Transaction be approved, other than in circumstances where the Independent Expert's Report expresses the opinion is that the Transaction is not "fair and reasonable" to non-associated Grange Shareholders or where there is a Superior Proposal; and
a statement to the effect that each Grange director of Grange will vote in favour of the $(b)$ Transaction in respect of Grange Shares that they hold or control, other than in circumstances where the Independent Expert's Report expresses the opinion is that the Transaction is not "fair and reasonable" to non-associated Grange Shareholders or where there is a Superior Proposal.

8.2 Public announcement and submissions

No public announcement in connection with any Transaction Agreement or the $(a)$ Transaction may be made other than in a form approved by both parties.
$(b)$ No submission for any Regulatory Approval under this agreement may be made by one party without reasonable consultation with the other party.
Each party must use all reasonable endeavours to provide the approval and $(c)$ constructively participate in the consultation contemplated by clauses 8.2(a) and (b) as soon as practicable.

8.3 Required disclosure

If a party is required by law, the Listing Rules or a requirement or a directive set by a regulator or market operator to make any announcement or disclosure relating to matter the subject of a Transaction Agreement, it must, to the extent practicable without that party breaching any such applicable law, Listing Rule, requirement or directive set by a regulator or market operator, give the other party:

such notice as is reasonable in the circumstances of its intention to make the $(a)$ announcement or disclosure: and
$(b)$ a draft of the announcement or disclosure and an opportunity, which is reasonable in the circumstances, to comment on the form and content of the draft announcement or disclosure.

9 Board of directors and corporate governance

$9.1$ General

Grange must take all actions necessary to ensure that, on and from Completion, the nominees and key executives will be appointed to the Grange Board and management in accordance with this clause 9 and that all other directors on the Grange Board resign.

$9.2$ Board

On and from Completion, Grange will have 8 directors on the Grange Board comprised $(a)$ as follows:
$(1)$ Anthony Bohnenn;
$(2)$ each of the following nominees of Shagang:
- $(A)$ Feng GAO or another person nominated by Shagang;
- $(B)$ Cheung Clement KO or another person nominated by Shagang;
- $(C)$ Bin SHEN or another person nominated by Shagang;
$(D)$ Dave SANDY or another person nominated by Shagang who must be an executive of ABM;
$(E)$ 2 independent directors to be nominated by Shagang after reasonable consultation with Grange; and
$(3)$ Russell Clark will remain on the Board as Managing Director.
Shagang will nominate a non-executive Chairman of the Board, after reasonable $(b)$ consultation with Grange. If the Chairman is:
an independent director, Shagang must nominate one of its other directors as $(1)$ Deputy Chairman; and
$(2)$ not an independent director, Anthony Bohnenn will be the Deputy Chairman.
In this clause 9, "independent" means independent of Shagang (a director is independent $(c)$ notwithstanding that he or she is nominated by Shagang, provided that the nominee is not an employee or officer, agent or consultant of a Shagang Group Member (excluding any entity that is a Grange Group Member at the date of this agreement)).
$(d)$ The parties acknowledge and agree that the composition of the Grange Board following Completion set out in clause 9.2(a) is appropriate and should contain at least 3 independent directors whilst Shagang's shareholding in Grange remains at its postcompletion level, but that if Shagang's shareholding in Grange materially changes, the parties agree that the Grange Board composition will be adjusted so that the number of nominees of Shagang on the Board will be approximately proportionate to Shagang's voting power in Grange.

$9.3$ Key executives

On and from Completion, Grange's key executives will be as follows:

$(a)$ Russell Clark will be Chief Executive Officer:
$(b)$ subject to consultation with the Managing Director and Chief Executive Officer of Grange, Shagang will nominate executives of ABM as Chief Operating Officer and Chief Financial Officer: and
other key management roles will be determined based on the most suitable candidate for $(c)$ each position.

$9.4$ Corporate governance

On and from Completion, Shagang and Grange will, and will procure that the Shagang $(a)$ nominees appointed to the Grange Board, and the remaining Grange directors will, comply with all applicable laws and the Listing Rules in relation to any dealings between Shagang (or any of its Related Bodies Corporate) and Grange (or any of its Related Bodies Corporate), including:
obtaining any shareholder approvals for transactions between Shagang and $(1)$ Grange, where required by any applicable law or the Listing Rules;
$(2)$ any applicable laws relating to conflicts of interest for directors and of directors excluded from voting in relation to matters considered by the Grange Board;
$(3)$ any applicable laws relating to "related party" transactions, given that, on and from Completion, Shagang (and its Related Bodies Corporate) will be treated as related parties of Grange for these purposes; and
$(4)$ the legal obligations to act in good faith, in the best interests of Grange, and for the proper purposes, and to have regard to the interests of the Grange Shareholders and Grange as a whole.
$(b)$ Each transaction (including any offtake) in which Shagang has an interest must either be:
approved by independent Grange Shareholders where required by legislation or $(1)$ the Listing Rules; or
$(2)$ approved by a majority of the independent directors. For the avoidance of doubt, where there is an even number of independent directors, a majority will be constituted by more than half of the number of independent directors.
The interests of Grange regarding any Claims arising out of, or matters relating to, the $(c)$ Transaction, the SSA or this agreement (including Claims in respect of any Warranties) must be dealt with, considered and determined by the independent directors, acting in the best interests of Grange.
As soon as practicable after Completion, Shagang and Grange will procure that the $(d)$ Grange Board will establish protocols setting out:
$(1)$ the structures and procedures which will be put in place by the Grange Board to ensure that the consideration by the Grange Board and management of Grange's business and the business of its subsidiaries (including, but not limited to, those matters referred to or contemplated in clauses 9.4(a) to 9.4(c) above) is undertaken free from any actual or the appearance of any conflict of interest; and
$(2)$ the requirement for each director of Grange to declare any interest he or she has in the matter being considered by the Grange Board and appropriate measures to be taken upon that declaration.

Southdown Off-Take $10$

$(a)$ Shagang and Grange must negotiate in good faith to agree a fair market price for the delivery of approximately 80% of the Available Southdown Off-Take to Shagang or its associates, having regard to following factors in relation to price:
$(1)$ seaborne iron ore supply and demand conditions;
$(2)$ available published price benchmarks for iron ore;
product quality differentials; and $(3)$
$(4)$ potential freight costs.
$(b)$ Negotiations must be for a period of 3 months, commencing on a date as nominated by Shagang but in any event before any agreement for the supply of Available Southdown Off-Take is entered into between Grange and any third party.

$11$ General

$11.1$ No representation or reliance

$(a)$ Each party acknowledges that no party (nor any person acting on its behalf) has made any representation or other inducement to it to enter into this agreement, except for representations or inducements expressly set out in this agreement and the SSA.
$(b)$ Each party acknowledges and confirms that it does not enter into this agreement in reliance on any representation or other inducement by or on behalf of any other party. except for any representation or inducement expressly set out in this agreement and the SSA.
$(c)$ Each party acknowledges and confirms that clauses 11.1(a) and (b) do not prejudice any rights a party may have in relation to information which has been filed by the other party with the ASIC or ASX.

$11.2$ No merger

$11.3$ Prohibition and enforceability

Any provision of, or the application of any provision of, this agreement that is prohibited in $(a)$ any jurisdiction is, in that jurisdiction, ineffective only to the extent of that prohibition.
Any provision of, or the application of any provision of, this agreement that is void, illegal $(b)$ or unenforceable in any jurisdiction does not affect the validity, legality or enforceability of that provision in any other jurisdiction or of the remaining provisions in that or any other jurisdiction.

$11.4$ Severability

$11.5$ Consents

11.6 Notices

Any communication under or in connection with this agreement:

$(a)$ must be in writing;
$(b)$ must be addressed as shown below:

Grange
Name:	Grange Resources Limited
Address:	Level 11, 200 St Georges Terrace, Perth WA 6000
Fax no:	(08) 9321 1523
For the attention of:	Russell Clark, Managing Director and Chief Executive Officer
Shagang
Name:	Shagang International Holdings Limited
Address:	Unit 2902, 29/F Far East Finance Centre, 16 Harcourt Road, Admiralty, Hong Kong
Fax no:	00852-28875082 (Tel: 00852-28875081)
For the attention of:	Mr. Peter Chen

(or as otherwise notified by that party to the other party from time to time);

$(c)$ must be signed by the party making the communication or by a person duly authorised by that party;
must be delivered or posted by prepaid post to the address, or sent by fax to the number, $(d)$ of the addressee, in accordance with clause 11.6(b); and
$(e)$ is regarded as received by the addressee:
if sent by prepaid post, on the third Business Day after the date of posting to an $(1)$ address within Australia, and on the fifth Business Day after the date of posting to an address outside Australia;
$(2)$ if sent by fax, at the local time (in the place of receipt of that fax) which then equates to the time at which that fax is sent as shown on the transmission report which is produced by the machine from which that fax is sent and which confirms transmission of that fax in its entirety, unless that local time is not a Business Day, or is after 5.00pm on a Business Day, when that communication will be regarded as received at 9.00am on the next Business Day; and
$(3)$ if delivered by hand, on delivery at the address of the addressee as provided in clause 11.6(b), unless delivery is not made on a Business Day, or after 5.00pm on a Business Day, when that communication will be regarded as received at 9.00am on the next Business Day.

$11.7$ Service of process

$(a)$ Without preventing any other mode of service, any document in an action (including, any writ of summons or other originating process or any third or other party notice) may be served on any party by being delivered to or left for that party at its address for service of notices under clause 11.6.
$(b)$ Shagang irrevocably appoints Freehills of Level 36, QV.1 Building, 250 St Georges Terrace, Perth, WA 6000 as its agent for the service of process in Australia in relation to

any matter arising out of this agreement. If Freehills ceases to be able to act as such or have an address in Australia, Shagang agrees to appoint a new process agent in Australia and deliver to the other party within 20 Business Days a copy of a written acceptance of appointment by the process agent, upon receipt of which the new appointment becomes effective for the purpose of each Transaction Agreement. Shagang must inform the other party in writing of any change in the address of its process agent within 20 Business Days of the change.

$11.8$ Governing law and jurisdiction

$(a)$ This agreement is governed by the laws of Western Australia.
$(b)$ Each party irrevocably submits to the non-exclusive jurisdiction of the courts of Western Australia and courts competent to hear appeals from those courts.

11.9 Waivers

$(a)$ Failure to exercise or enforce, a delay in exercising or enforcing, or the partial exercise or enforcement of any right, power or remedy provided by law or under this agreement by any party does not in any way preclude, or operate as a waiver of, any exercise or enforcement, or further exercise or enforcement, of that or any other right, power or remedy provided by law or under this agreement.
$(b)$ Any waiver or consent given by any party under this agreement is only effective and binding on that party if it is given or confirmed in writing by that party.
No waiver of a breach of any term of this agreement operates as a waiver of another $(c)$ breach of that term or of a breach of any other term of this agreement.

$11.10$ Variation

This agreement may only be varied by a document signed by or on behalf of each of the parties.

$11.11$ Assignment

A party may not assign, novate or otherwise transfer any of its rights or obligations under this agreement without the prior written consent of the other party.

11.12 Further action

Each party will do all things and execute all further documents necessary to give full effect to this agreement.

11.13 Entire agreement

This agreement supersedes all previous agreements in respect of its subject matter and. together with the SSA, embodies the entire agreement between the parties.

11.14 Counterparts

$(a)$ This agreement may be executed in any number of counterparts.
$(b)$ All counterparts, taken together, constitute one instrument.
A party may execute this agreement by signing any counterpart. $(c)$

Signing page

	Executed as an agreement
	Shagang
sign here >	Signed by Great Period Limited by
	Director
print name	Bin Shen
	Grange
	Signed for and on behalf of Grange Resources Limited by Vivien Hui, its Attorney under a Power of Attorney dated
	23 September 2008 and the Attorney declares that the Attorney has not received any notice of the revocation of such Power of Attomey, in the presence of:	Signature of Attorney
	Signature of Witness	VIVIEN WING YIN HMI Name of Attorney in full
	Gao Name of Witness in

page 20

Form 603 Corporations Act 2001
Section 671B

$\ldots$ . . . . . . . . . . . . . . . . . . .

111 111 11

Notice of initial substantial holder

To Company Name/Scheme	Grange Resources Limited (Grange) 009 132 405
ACN/ARSN

1. Details of substantial holder (1)
Name	Pacific International Co. Pty Ltd (PI) and each of the entities and persons set out in Annexure A (Associates)
ACN/ARSN (if applicable)	133 363 265

2. Details of voting power

The holder became a substantial holder on

2 January 2009

Class of securities (4)	Number of securities	Person's votes (5)	Voting power (6)
Ordinary	343,038,639	343,038,639	69.3%, based on 495,343,653 ordinary shares on issue as at 2 January 2009

3. Details of relevant interests

The nature of the relevant interest the substantial holder or an associate had in the following voting securities on the date the substantial holder became a substantial holder are as follows:

Holder of relevant interest	Nature of relevant interest (7)	Class and number of securities
PI and Associates	Relevant interest under subsections (608(1) (holder) of the Corporations Act 12001 (Cth).	343,038,639 fully paid ordinary shares

4. Details of present registered holders

The persons registered as holders of the securities referred to in paragraph 3 above are as follows:

Holder of relevant interest	Registered holder of securities	Person entitled to be registered as holder (8)	Class and number of securities
PI and Associates	Shagang International Holdings ILtd	Shagang International Holdings Lid	232,575,639
PI and Associates	RGL Holdings Co. Ltd	RGL Holdings Co. Ltd	68,404,600
PI and Associates	Pacific International Co. Pty Ltd	Pacific International Co. Pty Ltd	41,042,760
PI and Associates		Ever Lucky Developments Limited Ever Lucky Developments Limited 1,015,640

5. Consideration

$\bar{z}$

$\ddot{\phantom{a}}$

Holder of relevant interest	Date of acquisition	Consideration (9)		Class and number of securities
		Cash	Non-cash
IPI and Associates	2 January 2009	The consideration is the transfer by Shagang International Holdings Ltd, RGL Holdings Co. Ltd and PI of 100% of the total issued capital of Ever Green Resources Co. Ltd to Grange Resources Limited on the terms of the Share Sale Agreement and Merger Implementation Agreement both dated 24 September 2008, and attached to the substantial holder notice lodged by Shagang International Holdings Ltd on the same date as this notice.		342,022,999 ordinary Shares

Details of the consideration must include any and all benefits, moneys and other, that any person from whom a relevant interest was acquired has, or
may, become entitled to receive in relation to that acquisition. Details $(9)$

6. Associates

The reasons the persons named in paragraph 3 above are associates of the substantial holder are as follows:

Name and ACN/ARSN (if applicable)	Nature of association
RGL Holdings Co. Ltd and Shagang International Holdings Ltd	Shagang International Holdings Ltd, RGL Holdings Co. Ltd and PI may in certain circumstances act jointly in respect of their investment where their interests are aligned, which means that they are deemed to be associates under section 12(2) of the Corporations Act 2001 (Cth).
Bodies corporate listed in Annexure A	Each of the bodies corporate and persons listed in Annexure A is a related body corporate or controller of either Shagang International Holdings Ltd. RGL Holdings Co. Ltd or PI, therefore they are associates under section 12(2) of the Corporations Act 2001 (Cth).

. . . . . . . . . . . . . . . . . . . .

7. Addresses

The addresses of persons named in this form are as follows:

Name	Address
Shagang International Holdings Ltd	Uinfeng Town, Zhangjiagang City, Jiangsu Province in the People's Republic of China (Postcode 215626)
RGL Holdings Co. Ltd	[23/F, New Poly Plaza, No. 1 North Chaoyangmen Street, Dongcheng District, Beiling, in the People's Republic of China
¦P.	Unit 2102, 21/F Sino Plaza, 255-257 Gloucester Road, Causeway Bay, Hong Kong

Signature

print name	Cheung Clement Ko	capacity	Director
sign here	M	date	4 January 2009
	DIRECTIONS

If there are a number of substantial holders with similar or related relevant interests (eg. a corporation and its related corporations, or the manager and
trustee of an equity trust), the names could be included in an ann $(1)$ is clearly set out in paragraph 7 of the form.
$(2)$ See the definition of "associate" in section 9 of the Corporations Act 2001.
$(3)$ See the definition of "relevant interest" in sections 608 and 671B(7) of the Corporations Act 2001.
$(4)$ The voting shares of a company constitute one class unless divided into separate classes.
$(5)$ The total number of votes attached to all the voting shares in the company or voting interests in the scheme (if any) that the person or an associate has a relevant interest in.
$(6)$ The person's votes divided by the total votes in the body corporate or scheme multiplied by 100.
$(7)$ Include details of:
any relevant agreement or other circumstances by which the relevant interest was acquired. If subsection 671B(4) applies, a copy of any $(a)$ document setting out the terms of any relevant agreement, and a statement by the person giving full and accurate details of any contract, scheme or arrangement, must accompany this form, together with a written statement certifying this contract, scheme or arrangement; and
any qualification of the power of a person to exercise, control the exercise of, or influence the exercise of, the voting powers or disposal of the $(b)$ securities to which the relevant interest relates (indicating clearly the particular securities to which the qualification applies).

See the definition of "relevant agreement" in section 9 of the Corporations Act 2001,

$(8)$ If the substantial holder is unable to determine the identity of the person (eg. if the relevant interest arises because of an option) write "unknown."

Annexure A

Pacific International Co. Pty Ltd

This is Annexure A of 3 pages referred to in Form 603 "Notice of Initial Substantial Holder" signed by me and dated 4 January 2009.

sign here $\blacksquare$

$\mathcal{L}_{\mathcal{A}}$

$\ddot{\phantom{a}}$

print name Cheung Clement Ko

$\ddot{\phantom{0}}$

$\hat{z}$ , $\hat{z}$ , $\hat{z}$ , $\hat{z}$

Associates of Shagang International Holdings Ltd.

Evergain International Corporation	Zhangjiagang City Shagang Copper Co., Ltd
Ever Lucky Development Limited	Zhangjiagang City Yong'an Steel Co., Ltd
Fayuan Steel Burden Trade Co., Ltd	Zhangjiagang East Gas-making Corporation
Hade Union (Zhangjiagang City) Petrochemical Industry Co., Ltd	Zhangjiagang Haili-wharf Co., Ltd
Hongrun Real Estate Development Co.,	Zhangjiagang Hengchang Neotype
Ltd	Tignum Co., Ltd
Iron-making of Jiangsu Shagang Group	Zhangjiagang Hengchang Precision
Co., Ltd	milling Co., Ltd
Jiangsu Runzhong High-tech	Zhangjiagang Hengle Neotype Tignum
Corporation	Co., Ltd

Jiangsu Shagang Group Co., Ltd	Zhangjiagang Hongchang Gas-making Co., Ltd
Jiangsu Shagang Group Huaigang	Zhangjiagang Hongchang High-speed
Special Steel Co., Ltd	Wire Co., Ltd
Jiangsu Shagang Group Xinrui Special	Zhangjiagang Hongchang Pelletzing
Steel Co., Ltd	Co., Ltd
Jiangsu Shagang Group Zhangjiagang	Zhangjiagang Hongchang Ship-tearing
Kaihua Press Co., Ltd	Co., Ltd
Jiangsu Shagang International Trade	Zhangjiagang Hongchang Steel-bar
Co., Ltd	Co., Ltd
Jiangsu Yong Steel Group Co., Ltd	Zhangjiagang Hongchang Steel-plate Co., Ltd

Co., Ltd

Product Co., Ltd

Ltd

Wire Co., Ltd

Zhangjiagang Hongxing High-speed

Zhangjiagang Huasheng Iron-making

Zhangjiagang Jingde Steel-plate Co.,

Zhangjiagang Posco Stainless Steel

Zhangjiagang Pusha-wharf Co., Ltd

Zhangjiagang Rongde Stainless-steel

Zhangjiagang Rongsheng Steel-making

Zhangjiagang Runzhong Steel Co., Ltd

Zhangjiagang Sanhe-Shagang High-

temperature Technology Co., Ltd

Zhangjiagang Shagang Tongxin

Galvanized -steel Co., Ltd

Zhangjiagang Huasha Auto-

development Co., Ltd

Jinde Trade Co., Ltd

Qianyuan Metal Trade Co., Ltd

Rongde Trade Co., Ltd

Runyuan Stainless Steel Co., Ltd

Shagang (Singapore) Pte Ltd

Shagang Group Living-service Co., Ltd

Shagang International (Hong Kong) Co. Ltd.

Shagang International Holdings Ltd.

Shagang Mining (Australia) Pty Ltd

Shagang Occupation-service & Human resource Development Co., Ltd

Shagang Shipping Co., Ltd

Shagang SouthAsia (Hong Kong) Trading Co., Ltd

Shajing International Trade Co., Ltd

Mr Wenrong Shen

Zhangjiagang City Hongda Transportion Co., Ltd

Zhangjiagang City Huadong Scrap steel Trade Co., Ltd

Zhangjiagang City Pharmaceutical Factory

Zhangjiagang City Scrap Steel Processing & Supplying Company

Associates of RGL Holdings Co Ltd.

Alasan Meng Huaxi Trading Co., Ltd. Alasan Meng Jinganglian Co., Ltd.

RGL International Co., Ltd

Shanghai Jingxi Industry Co., Ltd.

Zhangjiagang Shajing Steel Co., Ltd

Zhangjiagang Shajing Wide & heavy Plate Co., Ltd

Zhangjiagang Shatai Steel Co., Ltd

Zhangjiagang Xiaosha Steel Processing Co., Ltd

Zhangjiagang Xingrong Coated Board Co., Ltd

Zhangjiagang Xingrong Iron-making Co., Ltd

Zhangjiagang Yongxin Steel Co., Ltd

Alasan Meng RGL Industry Development Co., Ltd.

والمتمر للمحا

a para a la

Shanghai Ruixilian Industry Co., Ltd.

Beijing RGL Science Development Co., Ltd.

Fujian RGL Trading Co., Ltd.

Fuzhou RL Steel Co., Ltd.

Fuzhou RL Trading Co., Ltd.

Jiaozuo Ruiwang Industry Co., Ltd.

RGL Group Co., Ltd

Mr Zhenhua You

Shanghai Ruixilian Trading Co., Ltd.

Shanghai Ruiyelian Industry Co., Ltd.

Shenzhen RGL Industry Co., Ltd.

Wuhan RGL Industry and Trade Co., Ltd.

Yiyang Yifeng Road and Bridge Development Co., Ltd.

Shanghai Huaxi Industry Co., Ltd.

Associates of Pacific International Co Pty Ltd.

Acefair Pacific Limited	Pacific Minerals Investment Limited
Eastchoice Pacific Limited	Pacific Minerals Limited
Ever Green Resources Co. Limited.(Formerly known as Shagang Mining Co., Ltd.)	Pacific Minerals Trading Limited
Fastlane Limousine Co., Ltd. (Acefair Pacific Ltd. is 60% shareholder)	Pacific Shipping Limited
Mainway Resources Limited	Shanghai Pacific Minerals Limited
Mineral Power Limited	Suzhou Metallurgical Resources (Hong Kong) Company Limited
Pacific International Business Limited	Mr Cheung (Clement) Ko

Pacific International Co., Pty Ltd.

Form 603 Corporations Act 2001
Section 671B

Notice of initial substantial holder

To Company Name/Scheme	Grange Resources Limited (Grange)
ACNIARSN	009 132 405

1. Details of substantial holder (1) Name	RGL Holdings Co., Ltd (RGL) and each of the entities and persons set out in Annexure A (Associates)
ACN/ARSN (if applicable)	Not applicable

2. Details of voting power

Class of securities (4)	Number of securities	Person's votes (5)	Voting power (6)
Ordinary	343,038,639	343.038.639	69.3%, based on 495,343,653 ordinary shares on issue as at 2 Uanuary 2009

3. Details of relevant interests

The nature of the relevant interest the substantial holder or an associate had in the following voting securities on the date the substantial holder became a substantial holder are as follows:

Holder of relevant interest	Nature of relevant interest (7)	Class and number of securities
RGL and Associates	Relevant interest under subsections 608(1) (holder) of the Corporations Act 2001 (Cth).	343,038,639 fully paid ordinary shares

4. Details of present registered holders

The persons registered as holders of the securities referred to in paragraph 3 above are as follows:

Holder of relevant interest	Registered holder of securities	Person entitled to be registered as holder (8)	Class and number of securities
RGL and Associates	Shagang International Holdings Ltd	Shagang International Holdings Ltd	232.575.639
RGL and Associates	RGL Holdings Co. Ltd	RGL Holdings Co. Ltd	68,404,600
RGL and Associates	Pacific International Co. Pty Ltd	Pacific International Co. Pty Ltd	41.042.760
IRGL and Associates		Ever Lucky Developments Limited Ever Lucky Developments Limited 1,015,640

5. Consideration

$\frac{1}{2}$

$\label{eq:2.1} \frac{1}{\sqrt{2}}\int_{0}^{\infty}\frac{1}{\sqrt{2\pi}}\left(\frac{1}{\sqrt{2\pi}}\right)^{2}d\mu.$

$\bar{\mathcal{A}}$

$\frac{1}{2} \sum_{i=1}^{n} \frac{1}{2} \sum_{j=1}^{n} \frac{1}{2} \sum_{j=1}^{n} \frac{1}{2} \sum_{j=1}^{n} \frac{1}{2} \sum_{j=1}^{n} \frac{1}{2} \sum_{j=1}^{n} \frac{1}{2} \sum_{j=1}^{n} \frac{1}{2} \sum_{j=1}^{n} \frac{1}{2} \sum_{j=1}^{n} \frac{1}{2} \sum_{j=1}^{n} \frac{1}{2} \sum_{j=1}^{n} \frac{1}{2} \sum_{j=1}^{n} \frac{1}{2} \sum_{j=1}^{n$

$\sim$

Holder of relevant interest	Date of acquisition	Consideration (9)		Class and number of securities
		Gash	Non-cash
RGL and Associates	2 January 2009	The consideration is the transfer by Shagang International Holdings Ltd. RGL and Pacific International Co. Pty Ltd of 100% of the total issued capital lof Ever Green Resources Co. Ltd to Grange Resources Limited on the lterms of the Share Sale Agreement and Merger Implementation Agreement both dated 24 September 2008, and attached to the substantial holder notice lodged by Shagang International Holdings Ltd on the same date as this notice.		342.022.999 ordinary Íshares

$\lambda$

$\sim 10^{-1}$

6. Associates

The reasons the persons named in paragraph 3 above are associates of the substantial holder are as follows:

Name and ACN/ARSN (if applicable)	Nature of association
Shagang International Holdings Ltd and Pacific International Co. Pty Ltd	Shagang International Holdings Ltd, RGL and Pacific International Co. Pty Ltd may in certain circumstances act jointly in respect of their investment where their interests are aligned, which means that they are deemed to be associates under section $12(2)$ of the Corporations Act 2001 (Cth).
Bodies corporate listed in Annexure A	Each of the bodies corporate and persons listed in Annexure A is a related body corporate or controller of either Shagang International Holdings Ltd. RGL or Pacific International Co. Pty Ltd, therefore they are associates under section 12(2) of the Corporations Act 2001 (Cth).

7. Addresses

The addresses of persons named in this form are as follows:

Name	Address
Shagang International Holdings Ltd	Uinfeng Town, Zhangjiagang City, Jiangsu Province in the People's Republic of China (Postcode 215626)
IRGL	[23/F, New Poly Plaza, No. 1 North Chaoyangmen Street, Dongcheng District, Beijing, in the People's Republic of China
Pacific International Co. Pty Ltd	Unit 2102, 21/F Sin Plaza, 255-257 Gloucester Road, Causeway Bay, Hong Kong

Signature

print name		capacity	Divertor
sign here		date	January 2009

	DIRECTIONS
	number of substantial bolders with similar or related relevant interests (eq. a corporation and its related corporations, or the manager and

$(1)$ If there are a trusted of an equity trust), the names could be included in an annexure to the form. If the relevant interests of a group of persons are essentially similar, they may be referred to throughout the form as a specifically named group if the membership of each group, with the names and addresses of members is clearly set out in paragraph 7 of the form.
See the definition of "associate" in section 9 of the Corporations Act 2001. $(2)$
See the definition of "relevant interest" in sections 608 and 671B(7) of the Corporations Act 2001. $(3)$
The voting shares of a company constitute one class unless divided into separate classes. $(4)$
The total number of votes attached to all the voting shares in the company or voting interests in the scheme (if any) that the person or an associate has a $(5)$ relevant interest in.
The person's votes divided by the total votes in the body corporate or scheme multiplied by 100. $(6)$
$(7)$ Include details of:
any relevant agreement or other circumstances by which the relevant interest was acquired. If subsection 671B(4) applies, a copy of any
document setting out the terms of any relevant agreement, and a statement by the perso $(a)$ scheme or arrangement, must accompany this form, together with a written statement certifying this contract, scheme or arrangement; and
any qualification of the power of a person to exercise, control the exercise of, or influence the exercise of, the voting powers or disposal of the $(b)$ securities to which the relevant interest relates (indicating clearly the particular securities to which the qualification applies).

See the definition of "relevant agreement" in section 9 of the Corporations Act 2001.

If the substantial holder is unable to determine the identity of the person (eg. if the relevant interest arises because of an option) write "unknown." $(8)$

$\ddot{\phantom{a}}$ $\sim 1/4$ $\sim$

Annexure A

RGL Holdings Co. Ltd

This is Annexure A of 3 pages referred to in Form 603 "Notice of Initial Substantial Holder" signed by me and dated $4$ January 2009.

sign here	$\sim$ decrease and a relatively set of [OfficeReproductional Constitution of the Constitution of the control of a state of the state of the control of the second magnetize and a state of a specific

print name	Zhenhua THE REPORT OF A REPORT OF A REPORT OF A REPORT OF A REPORT OF A REPORT OF A REPORT OF A REPORT OF A REPORT OF A REPORT OF A REPORT OF A REPORT OF A REPORT OF A REPORT OF A REPORT OF A REPORT OF A REPORT OF A REPORT OF A RE -------- PRODUCTION CONTINUES.

$\sim$

Associates of Shagang International Holdings Ltd.

Evergain International Corporation	Zhangjiagang City Shagang Copper Co., Ltd
Ever Lucky Development Limited	Zhangjiagang City Yong'an Steel Co., Ltd
Fayuan Steel Burden Trade Co., Ltd	Zhangjiagang East Gas-making Corporation
Hade Union (Zhangjiagang City) Petrochemical Industry Co., Ltd	Zhangjiagang Haili-wharf Co., Ltd
Hongrun Real Estate Development Co.,	Zhangjiagang Hengchang Neotype
Ltd	Tignum Co., Ltd
Iron-making of Jiangsu Shagang Group	Zhangjiagang Hengchang Precision
Co., Ltd	milling Co., Ltd
Jiangsu Runzhong High-tech	Zhangjiagang Hengle Neotype Tignum
Corporation	Co., Ltd

Jiangsu Shagang Group Co., Ltd	Zhangjiagang Hongchang Gas-making Co., Ltd
Jiangsu Shagang Group Huaigang	Zhangjiagang Hongchang High-speed
Special Steel Co., Ltd	Wire Co., Ltd
Jiangsu Shagang Group Xinrui Special	Zhangjiagang Hongchang Pelletzing
Steel Co., Ltd	Co., Ltd
Jiangsu Shagang Group Zhangjiagang	Zhangjiagang Hongchang Ship-tearing
Kaihua Press Co., Ltd	Co., Ltd
Jiangsu Shagang International Trade	Zhangjiagang Hongchang Steel-bar
Co., Ltd	Co., Ltd
Jiangsu Yong Steel Group Co., Ltd	Zhangjiagang Hongchang Steel-plate. Co., Ltd

Jinde Trade Co., Ltd

Qianyuan Metal Trade Co., Ltd

Rongde Trade Co., Ltd

Runyuan Stainless Steel Co., Ltd

Shagang (Singapore) Pte Ltd

Shagang Group Living-service Co., Ltd

Shagang International (Hong Kong) Co. Ltd.

Shagang International Holdings Ltd.

Shagang Mining (Australia) Pty Ltd

Shagang Occupation-service & Human resource Development Co., Ltd

Shagang Shipping Co., Ltd

Shagang SouthAsia (Hong Kong) Trading Co., Ltd

Shajing International Trade Co., Ltd

Mr Wenrong Shen

Zhangjiagang City Hongda Transportion Co., Ltd

Zhangjiagang City Huadong Scrap steel Trade Co., Ltd

Zhangjiagang City Pharmaceutical Factory

Zhangjiagang City Scrap Steel Processing & Supplying Company

Zhangjiagang Yongxin Steel Co., Ltd

Associates of RGL Holdings Co Ltd.

Alasan Meng Huaxi Trading Co., Ltd.

Alasan Meng Jinganglian Co., Ltd.

RGL International Co., Ltd

Shanghai Jingxi Industry Co., Ltd.

Co., Ltd

Zhangjiagang Hongxing High-speed Wire Co., Ltd

Zhangjiagang Huasha Autodevelopment Co., Ltd

Zhangjiagang Huasheng Iron-making Co., Ltd

Zhangjiagang Jingde Steel-plate Co., Ltd

Zhangjiagang Posco Stainless Steel Co., Ltd

Zhangjiagang Pusha-wharf Co., Ltd

Zhangjiagang Rongde Stainless-steel Product Co., Ltd

Zhangjiagang Rongsheng Steel-making Co., Ltd

Zhangjiagang Runzhong Steel Co., Ltd

Zhangjiagang Sanhe-Shagang Hightemperature Technology Co., Ltd

Zhangjiagang Shagang Tongxin Galvanized -steel Co., Ltd

Zhangjiagang Shajing Steel Co., Ltd

Zhangjiagang Shajing Wide & heavy Plate Co., Ltd

Zhangjiagang Shatai Steel Co., Ltd

Zhangjiagang Xiaosha Steel Processing Co., Ltd

Zhangjiagang Xingrong Coated Board Co., Ltd

Zhangjiagang Xingrong Iron-making Co., Ltd

Alasan Meng RGL Industry Development Co., Ltd.

Fujian RGL Trading Co., Ltd.

Fuzhou RL Trading Co., Ltd.

Jiaozuo Ruiwang Industry Co., Ltd.

Fuzhou RL Steel Co., Ltd.

Ltd.

Shanghai Ruixilian Industry Co., Ltd.

Beijing RGL Science Development Co., Shanghai Ruixilian Trading Co., Ltd.

Shanghai Ruiyelian Industry Co., Ltd.

Shenzhen RGL Industry Co., Ltd.

Wuhan RGL Industry and Trade Co., Ltd.

Yiyang Yifeng Road and Bridge Development Co., Ltd.

Shanghai Huaxi Industry Co., Ltd.

Mr Zhenhua You

RGL Group Co., Ltd

Associates of Pacific International Co Pty Ltd.

Pacific Minerals Investment Limited Acefair Pacific Limited Pacific Minerals Limited Eastchoice Pacific Limited Ever Green Resources Co., Limited (Formerly known as Shagang Mining Co., Ltd.) Pacific Minerals Trading Limited Fastlane Limousine Co., Ltd. (Acefair Pacific Ltd. is 60% shareholder) Pacific Shipping Limited Mainway Resources Limited Shanghai Pacific Minerals Limited Suzhou Metallurgical Resources (Hong Mineral Power Limited Kong) Company Limited Pacific International Business Limited Mr Cheung (Clement) Ko

Pacific International Co., Pty Ltd.

AI assistant

GRANGE RESOURCES LIMITED. — Major Shareholding Notification 2009

65014_rns_2009-01-06_d70ba92a-bb53-4960-bb51-e9fd55c0cf67.pdf

Notice of initial substantial holder in relation to Grange Resources Limited

Form 603 Corporations Act 2001Section 671B

Notice of initial substantial holder

3. Details of relevant interests

4. Details of present registered holders

5. Consideration

6. Associates

7. Addresses

Signature

DIRECTIONS

Annexure A

Shagang International Holdings Limited

Associates of Shagang International Holdings Ltd.

Associates of Pacific International Co Pty Ltd.

Annexure B

Shagang International Holdings Limited

Agreement

Share Sale Agreement

Freehills

Contents

Contents

Contents

Contents

The agreement

Share Sale Agreement

Date $\blacktriangleright$

The agreement

Operative part

Definitions and interpretation $\mathbf 1$

$1.1$ Agreement components

$1.2$ Definitions

$1.3$ Interpretation provisions

$1.4$ Inclusive expressions

$1.5$ Obligations and rights of Sellers

1.6 Authority to act

Conditions Precedent 2

$2.1$ Conditions

(Foreign Investment Review Board approval): $(a)$

$2.2$ Best endeavours

$2.3$ Waiver of conditions precedent

$2.4$ Consultation on failure of condition precedent

$2.5$ Certain notices

(Notice of failure of condition precedent): $(a)$

$2.6$ Cut Off Date

$2.7$ No binding agreement for transfer

3 Sale and purchase

$3.1$ Sale Shares

$3.2$ Associated Rights

$3.3$ Title and risk

Consideration Shares $3.4$

Period before Completion $\overline{4}$

$4.1$ Access for Grange

$4.2$ Access for Shagang

4.3 Carrying on of Transaction Entities Business

4.4 Carrying on of Grange Group Business

4.5 Permitted acts

$4.6$ Locked Box

$4.7$ Parent Guarantees

Seller Obligations 4.8

4.9 Savage River SPA Consideration

5 Termination

$5.1$ Termination by Grange

$5.2$ Termination by the Sellers

5.3 Automatic termination

$5.4$ Effect of termination

5.5 No other right to terminate or rescind

Pre-Completion actions 6

$6.1$ Board resolutions

$\overline{7}$ Completion

Time and Place $7.1$

$7.2$ Completion

$7.3$ Sellers' obligations at Completion

$7.4$ Grange's obligations at Completion

7.5 Notice to complete

7.6 Completion simultaneous

$7.7$ Post Completion actions

Warranties and Indemnities 8

GRANGE RESOURCES LIMITED. Major Shareholding Notification 2009

Form 603 Corporations Act 2001
Section 671B