IRC Limited — Capital/Financing Update 2015

Jul 17, 2015

THIS PROSPECTUS IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION

Hong Kong Exchanges and Clearing Limited, The Stock Exchange of Hong Kong Limited and Hong Kong Securities Clearing Company Limited take no responsibility for the contents of the Prospectus Documents, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss however arising from or in reliance upon the whole or any part of the contents of the Prospectus Documents.

If you are in any doubt about this Prospectus or as to the action to be taken, you should consult your licensed securities dealer, bank manager, solicitor,section headedprofessional‘‘Definitionsaccountant’’ in thisor otherProspectus,professionalunlessadviser.otherwiseCapitalisedstated. Iftermsyou haveused hereinsold orshalltransferredhave the allsameof meaningsyour Shares,as thoseyou shoulddefinedatinoncethe hand the Prospectus Documents to the purchaser(s) or transferee(s) or to the bank, the licensed securities dealer or other agent through whom the sale or transfer was effected for transmission to the purchaser(s) or transferee(s).

ACompaniescopy of’’eachin Appendixof the ProspectusIII — GeneralDocumentsInformationand theto documentsthis Prospectusspecifiedhaveinbeenthe registeredparagraph withheadedthe ‘‘RegistrarDocumentsof DeliveredCompaniestointheHongRegistrarKong asof required under Section 38D of the Companies (Winding Up and Miscellaneous Provisions) Ordinance. The Registrar of Companies in Hong Kong, the Stock Exchange and the SFC take no responsibility as to the contents of any of these documents.

Subject to the granting of the listing of and permission to deal in the Offer Shares on the Stock Exchange as well as compliance with the stock admission requirements of HKSCC, the Offer Shares will be accepted as eligible securities by HKSCC for deposit, clearance and settlement in CCASS with effect from the commencement date of dealings in the Offer Shares or such other dates as determined by HKSCC. Settlement of transactions between participants of the Stock Exchange on any trading day is required to take place in CCASS on the second settlement day thereafter. Dealings in securities of the Company and the Offer Shares may be settled through CCASS and you should consult your licensed securities dealer, bank manager, solicitor, professional accountant or other professional adviser for details of those settlement arrangements and how such arrangements may affect your rights and interests. All activities under CCASS are subject to the General Rules of CCASS and CCASS Operational Procedures in effect from time to time.

The attention of Shareholders with registered addresses in, and investors who are located or residing in, jurisdictions outside Hong Kong or holding Shares on behalf of Beneficial Owners with such addresses is drawn to the paragraph headed ‘‘Qualifying Shareholders’’ in the section headed ‘‘Letter from the Board’’ in this Prospectus.

The securities described in this Prospectus have not been registered under the U.S. Securities Act of 1933 (the ‘‘U.S. Securities Act’’) or the laws of any state in the United States, and may not be offered or sold within the United States, absent registration or an exemption from the registration requirements of the U.S. Securities Act and applicable state laws. There is no intention to register any portion of the Offer Shares or any securities described in this Prospectus in the United States or to conduct a public offering of securities in the United States. Distribution of this Prospectus into jurisdictions other than Hong Kong may be restricted by law. Persons into whose possession this Prospectus comes should inform themselves of and observe any such restrictions. This Prospectus is not for release, publication or distribution, directly or indirectly, in or into the United States. This Prospectus does not constitute or form part of any offer or invitation to sell or issue, or any solicitation of any offer to acquire, Offer Shares or to take up any entitlements to Offer Shares in any jurisdiction in which such an offer or solicitation is unlawful.

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(Incorporated in Hong Kong with limited liability)

(Stock Code: 1029)

OPEN OFFER ON THE BASIS OF 4 OFFER SHARES FOR EVERY 15 SHARES HELD ON THE RECORD DATE AT THE SUBSCRIPTION PRICE OF HK$0.315 PER OFFER SHARE

Underwriters

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Thethe paragraphLatest Timeheadedfor Acceptance‘‘Proceduresis for4:00Acceptancep.m. on Friday,and Payment31 July for2015.theTheOfferproceduresShares’’ infortheacceptancesection headedand payment‘‘Letterforfromthe theOfferBoardShares’’ onarepagesset out27 into 28 of this Prospectus.

sectionTheany ofOpentheheadedOfferconditions‘‘isLetterconditionalof fromthe OpentheuponBoardOfferthe’’asUnderwritingofsetthisoutProspectusin theAgreementparagraphsis notbecomingfulfilledheaded ‘‘unconditionalorConditionswaived, oftheandtheOpennotOpenbeingOfferOfferterminatedwillandnottheproceed,Underwritingin accordancein whichAgreementwithcaseits aterms.’’furtherin theIf announcement will be made by the Company at the relevant time.

It should be noted that Pine River together with any other Underwriter may, upon giving notice in writing to the Company, terminate the Underwriting Agreement with immediate effect at any time prior to the Latest Time for Termination, upon the occurrence of certain events, including force majeure events. These events are set out in the section headed ‘‘Termination of the Underwriting Agreement’’ on pages 10 to 11 of this Prospectus.

Any Shareholder or potential investor dealing in the Shares from the date of this Prospectus up to the date on which the conditions of the Open Offer are fulfilled, which is currently expected to be 4:00 p.m. on Wednesday, 5 August 2015, are subject to the risk that the Open Offer may not become unconditional and may not proceed. Shareholders and potential investors should therefore exercise caution when dealing in the Shares, and if they are in any doubt about their position, they are recommended to consult their professional advisers.

17 July 2015

NOTICES TO OVERSEAS INVESTORS

Notice relating to investors in Australia

This Prospectus is not a disclosure document under Chapter 6D of the Corporations Act 2001(Cth) (the ‘‘Australian Corporations Act’’). Neither this prospectus nor any other document in relation to the Offer Shares has been, or needs to be, lodged with the Australian Securities and Investments Commission. This Prospectus does not purport to include the information required of a disclosure document under Chapter 6D of the Australian Corporations Act.

An offer of Offer Shares is made in Australia only to persons to whom it is lawful to offer Offer Shares without disclosure under one or more of the exemptions set out in section 708 of the Australian Corporations Act (an ‘‘Exempt Person’’). By accepting this offer, an offeree represents that the offeree is an Exempt Person. No Offer Shares will be issued or sold in circumstances that would require the giving of a disclosure document under Chapter 6D of the Australian Corporations Act.

The Company is not licensed to provide financial product advice in Australia in relation to the Offer Shares. This prospectus is intended to provide general information only and has been prepared without taking into account any particular person’s objectives, financial situation or needs. Investors should, before acting on this information, consider the appropriateness of this information having regard to their personal objectives, financial situation or needs. No cooling off period applies in relation to this offer under the Australian Corporations Act.

Notice relating to investors in the British Virgin Islands

No offer shall be made to a member of the public under the Securities and Investment Services Business Act, 2010, as amended, of the British Virgin Islands (‘‘SIBA’’), however, the Offer Shares may be offered to a person who is not a member of the public in the British Virgin Islands, including British Virgin Islands Business Companies in certain circumstances described in SIBA.

Notice relating to investors in Canada

The Offer Shares will not be offered or distributed in Canada except in accordance with an exemption from prospectus requirements applicable in Canada. Any resale of the Offer Shares by a resident of Canada or to a resident of Canada must be made in accordance with applicable Canadian securities laws. Investors are advised to seek legal advice prior to any resale of the Offer Shares to a Canadian resident.

Notice relating to investors in the Cayman Islands

No invitation to the public in the Cayman Islands to subscribe for any Offer Shares is permitted to be made.

– i –

NOTICES TO OVERSEAS INVESTORS

Notice relating to investors in the EU

In relation to each Member State of the European Economic Area which has implemented the Prospectus Directive (as defined below) (each, a ‘‘Relevant Member State’’) (except the United Kingdom, to which the paragraphs headed ‘‘Notice to investors in the UK’’ apply), with effect from and including the date on which the Prospectus Directive is implemented in that Relevant Member State, none of the Offer Shares may be offered or sold to the public in that Relevant Member State prior to the publication of a prospectus in relation to such Offer Shares which has been approved by the competent authority in that Relevant Member State or, where appropriate, approved in another Relevant Member State and notified to the competent authority in that Relevant Member State, all in accordance with the Prospectus Directive, except that an offer of Offer Shares may be made to the public in that Relevant Member State:

• (i) to qualified investors (as defined in Article 2(1)(e) of the Prospectus Directive or implementing legislation in the Relevant Member State (‘‘European Qualified Investors’’));

• (ii) to fewer than 100, or, if the Relevant Member State has implemented the relevant provisions of the 2010 PD Amending Directive (as defined below), 150, natural or legal persons (other than European Qualified Investors); or

• (iii) in any other circumstances falling within Article 3(2) of the Prospectus Directive,

provided that no such offer of Offer Shares shall result in the requirement to publish a prospectus pursuant to Article 3 of the Prospectus Directive, or supplementing a prospectus pursuant to Article 16 of the Prospectus Directive, and each person who initially acquires Offer Shares or to whom any offer is made under the Open Offer will be deemed to have represented, warranted to and agreed with the Underwriters and the Company that it is a ‘‘qualified investor’’ within the meaning of the law in that Relevant Member State implementing Article 2(1)(e) of the Prospectus Directive. For the purpose of this selling restriction, the expression an ‘‘offer of Offer Shares’’ in relation to any Offer Shares in any Relevant Member State means the communication in any form and by any means of sufficient information on the terms of the offer and the Offer Shares to be offered so as to enable an investor to decide to purchase or subscribe for such securities, as the same may be varied in that Relevant Member State by any measure implementing the Prospectus Directive in that Relevant Member State, and the expression ‘‘Prospectus Directive’’ means Directive 2003/71/EC (as amended (including amendments by Directive 2010/73/EU (the ‘‘2010 PD Amending Directive’’) to the extent implemented in the relevant Member State)) and includes any relevant implementing measure in each Relevant Member State.

In the case of Offer Shares being offered to a financial intermediary, as that term is used in Article 3(2) of the Prospectus Directive, such financial intermediary will also be deemed to have represented, acknowledged and agreed that the Offer Shares acquired by it have not been acquired on a non-discretionary basis on behalf of, nor have they been acquired with a view to their offer or resale to, persons in circumstances which may give rise to an offer of any Offer Shares to the public other than their offer or resale in a Relevant Member State to ‘‘qualified investors’’ within

– ii –

NOTICES TO OVERSEAS INVESTORS

the meaning of Article 2(1)(e) of the Prospectus Directive. The Company, the Underwriters and their respective affiliates will rely upon the truth and accuracy of the foregoing representation, acknowledgement and agreement.

Notwithstanding the above, a person who is not a qualified investor but who is otherwise permitted by law to be offered and sold Offer Shares in circumstances which do not require the publication by the Company of a prospectus pursuant to Article 3 of the Prospectus Directive or other applicable laws and has notified the Company of such facts in writing may, with the prior consent of the Company, be permitted to acquire Offer Shares in the Open Offer.

Notice relating to investors in Singapore

The offer of the Offer Shares by the Company is made only to and directed at, and the Offer Shares are only available to, persons in Singapore who are existing holders of the Shares previously issued by the Company.

This Prospectus has not been and will not be registered as a prospectus with the Monetary Authority of Singapore. Accordingly, this Prospectus and any other document or material in connection with the offer or sale, or invitation for subscription or purchase, of the Offer Shares may not be circulated or distributed, nor may the Offer Shares be offered or sold, or be made the subject of an invitation for subscription or purchase, whether directly or indirectly, to persons in Singapore other than (i) existing holders of Shares or (ii) pursuant to, and in accordance with, the conditions of an exemption under Subdivision (4), Division I of Part XIII of the Securities and Futures Act, Chapter 289 of Singapore (the ‘‘SFA’’).

Accordingly, the Company has not offered or sold the Offer Shares or caused the Offer Shares to be made the subject of an invitation for subscription or purchase, nor shall it offer or sell the Offer Shares or cause the Offer Shares to be made the subject of an invitation for subscription or purchase, nor has it circulated or distributed nor shall it circulate or distribute this or any other document or material in connection with the offer or sale or invitation for subscription or purchase, of the Offer Shares, whether directly or indirectly, to persons in Singapore other than pursuant to, and in accordance with the conditions of, any other applicable provision of the SFA.

Notice relating to investors in the UK

This Prospectus contains no offer of transferable securities to the public within the meaning of Sections 85(1) and 102B of the United Kingdom Financial Services and Markets Act 2000, as amended (the ‘‘FSMA’’). This Prospectus is not a prospectus for the purposes of Section 85(1) of the FSMA. This Prospectus has not been examined or approved as a prospectus by the United Kingdom Financial Conduct Authority (‘‘FCA’’) under Section 87A of the FSMA, has not been filed with the FCA pursuant to the rules published by the FCA implementing the Prospectus Directive (Directive 2003/71/EC (as amended)) (the ‘‘United Kingdom Prospectus Rules’’) and it has not been approved by a person authorised under the FSMA for the purposes of Section 21 of the FSMA.

– iii –

NOTICES TO OVERSEAS INVESTORS

This Prospectus and any offer of securities pursuant thereto are within the United Kingdom only being and may only be directed at, and application forms (which are required to be completed by any applicant for Offer Shares) will only be despatched on request and subject to confirmation of regulatory status within the United Kingdom to, persons who (a) are a ‘‘qualified investor’’ within the meaning of Section 86(7) of FSMA, and (b) (1) fall within the categories of persons referred to in Article 19(5) (Investment professionals) or Article 49(2)(a)-(d) (High net worth companies, unincorporated associations, etc.) of the United Kingdom Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (the ‘‘Financial Promotion Order’’) or (2) are otherwise lawfully permitted to receive it (all such persons together being referred to as ‘‘relevant persons’’). The Offer Shares being offered hereunder are only available to, and any invitation, offer or agreement to subscribe, purchase or otherwise acquire such securities will be made to or engaged in only with, relevant persons. By offering to acquire Offer Shares potential investors in the United Kingdom will be deemed to have represented that they satisfy the criteria specified above to be a relevant person. Any person who is not a relevant person should not act or rely on this document or any of its contents.

Notwithstanding the above, a person who is not a qualified investor but who is otherwise permitted by law to be offered and sold Offer Shares in circumstances which do not require the publication by the Company of a prospectus pursuant to Article 3 of the Prospectus Directive or other applicable laws and has notified the Company of such facts in writing may, with the prior consent of the Company, be permitted to acquire Offer Shares in the Open Offer.

Notice relating to investors in the US

This Prospectus, the Application Form and the Offer Shares have not been and will not be registered under the US Securities Act or securities laws of any state or territory of the United States and may not be offered, sold, taken up, resold, renounced, transferred, delivered, directly or indirectly, in or into the United States, except pursuant to applicable exemption from, or in a transaction not subject to, the registration requirements of the US Securities Act and in compliance with any applicable securities laws of the states or other jurisdiction of the United States. There will be no public offer or sale of Offer Shares in the United States. In addition, until 40 days after the commencement of the Open Offer or the procurement of purchasers by the Underwriters of the Offer Shares not initially taken up, any offer, sale or transfer of the Offer Shares in or into the United States by a dealer (whether or not participating in the Open Offer) may violate the registration requirements of the US Securities Act.

Neither this Prospectus nor the Application Form constitutes, will constitute, or forms or will form, part of any offer or invitation to issue, purchase or acquire the Offer Shares to any person with a registered address, or who is located, in the United States. The Offer Shares and the Rights Shares are being offered outside the United States in reliance on Regulation S under the US Securities Act.

– iv –

NOTICES TO OVERSEAS INVESTORS

Notwithstanding the above, the Company may offer the Offer Shares in the United States to a limited number of persons whom the Company reasonably believes to be qualified institutional buyers (as defined in Rule 144A of the US Securities Act) in transactions exempt from the registration requirements under the US Securities Act, provided that such persons fulfil relevant requirements to the satisfaction of the Company.

Each subscriber of Offer Shares being offered and sold outside the United States in reliance on Regulation S under the US Securities Act will be deemed (by accepting delivery of this prospectus) to have agreed and given each of the following representations and warranties to the Company and the Underwriters and to any person acting on their behalf, unless in their sole discretion the Company and the Underwriters waive such requirement expressly in writing:

• . he/she/it was a Shareholder on the Record Date, or he/she/it lawfully acquired or may lawfully acquire the Offer Shares, directly or indirectly, from such a person;

• . he/she/it may lawfully be offered, take up, obtain, subscribe for and receive the Offer Shares in the jurisdiction in which he/she/it resides or is currently located;

• . he/she/it is not accepting an offer to acquire or take up the Offer Shares on a nondiscretionary basis for a person who is resident or located in, or a citizen of, the United States at the time the instruction to accept was given;

• . he/she/it is not taking up for the account of any person who is located in the United States, unless:

• (a) the instruction to subscribe for or accept Offer Shares was received from a person outside the United States, and

• (b) the person giving such instruction has confirmed that it (x) has the authority to give such instruction and (y) either (A) has investment discretion over such account or (B) is an investment manager or investment company that is acquiring the Offer Shares in an ‘‘offshore transaction’’ within the meaning of Regulation S under the US Securities Act;

• . he/she/it is acquiring the Offer Shares in an ‘‘offshore transaction’’ as defined in Regulation S under the US Securities Act;

• . he/she/it has not been offered the Offer Shares by means of any ‘‘directed selling efforts’’ as defined in Regulation S under the US Securities Act;

• . he/she/it is not acquiring Offer Shares with a view to the offer, sale, allotment, take up, exercise, resale, renouncement, pledge, transfer, delivery or distribution, directly or indirectly, of such Offer Shares into the United States; and

– v –

NOTICES TO OVERSEAS INVESTORS

• . he/she/it understands that the Offer Shares have not been and will not be registered under the US Securities Act or with any securities regulatory authority of any state, territory, or possession of the US and the Offer Shares are being distributed and offered only outside the US in reliance on Regulation S under the US Securities Act. Consequently he/she/it understands the Offer Shares may not be offered, sold, pledged or otherwise transferred in or into the US, except in reliance on an exemption from, or in transactions not subject to, the registration requirements of the US Securities Act.

This Prospectus, the Application Form and the Offer Shares have not been approved or disapproved by the US Securities and Exchange Commission, any state securities commission in the United States or any US regulatory authority, nor have any of the foregoing authorities passed upon or endorsed the merits of the offering, this Prospectus, the Application Form and the Offer Shares or the accuracy or adequacy of this prospectus. Any representation to the contrary is a criminal offence in the United States.

– vi –

FORWARD-LOOKING STATEMENTS

FORWARD-LOOKING STATEMENTS

Certain statements in this Prospectus are forward-looking statements. In some cases, forwardlooking statements may be identified by the use of words such as ‘‘might’’, ‘‘may’’, ‘‘could’’, ‘‘would’’, ‘‘will’’, ‘‘expect’’, ‘‘intend’’, ‘‘estimate’’, ‘‘anticipate’’, ‘‘believe’’, ‘‘plan’’, ‘‘seek’’, ‘‘continue’’, ‘‘illustration’’, ‘‘projection’’ or similar expressions and the negative thereof. Forwardlooking statements in this Prospectus include, without limitation, statements in respect of the Group’s intentions, beliefs or current expectations concerning, amongst other things, the Group’s liquidity, capital resources, capital expenditure programme, growth, strategies and the iron ore industry.

The forward-looking statements in this Prospectus are based on management’s present expectations about future events. Management’s present expectations reflect numerous assumptions regarding the Group’s operations, and liquidity, and the markets and the industry in which the Group operates. By their nature, they are subject to known and unknown risks and uncertainties, which could cause actual results and future events to differ materially from those implied or expressed by forward-looking statements. Should one or more of these risks or uncertainties materialise, or should any assumptions underlying forward-looking statements prove to be incorrect, the Group’s actual results could differ materially from those expressed or implied by forwardlooking statements. Additional risks not known to the Group or that the Group does not currently consider material could also cause the events and trends discussed in this Prospectus not to occur, and the estimates, illustrations and projections of financial performance not to be realised.

Prospective investors are cautioned that forward-looking statements speak only as at the Latest Practicable Date. Except as required by applicable laws, the Group does not undertake, and expressly disclaims, any duty to revise any forward-looking statement in this Prospectus, be it as a result of new information, future events or otherwise.

– vii –

CONTENTS

		Page
DEFINITIONS	. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	1
EXPECTED TIMETABLE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .		8
SUMMARY OF	THE OPEN OFFER . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	9
TERMINATION OF THE UNDERWRITING AGREEMENT . . . . . . . . . . . . . . . . . . . . . . . . .		10
LETTER FROM THE BOARD . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .		12
APPENDIX I	— FINANCIAL INFORMATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	I-1
APPENDIX II	— PRO FORMA FINANCIAL INFORMATION OF THE GROUP . . .	II-1
APPENDIX III	— GENERAL INFORMATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	III-1

– viii –

DEFINITIONS

In this Prospectus, unless the context otherwise requires, capitalised terms used shall have the following meanings:

• ‘‘Announcement’’

the announcement of the Company dated 29 June 2015 in relation to, among other things, the Open Offer

• ‘‘Application Form(s)’’ the form of application to be used by the Qualifying Shareholders to apply for the Offer Shares

• ‘‘Beneficial Owner(s)’’

• any beneficial owner(s) of Shares whose Shares are registered as shown in the register of members of the Company in the name of a Registered Owner

• ‘‘Board’’ the board of Directors

• ‘‘Business Day’’

• any day on which the Stock Exchange is open for business of dealings in securities

• ‘‘Cayiron’’

• Cayiron Limited, a wholly owned subsidiary of Petropavlovsk

• ‘‘CCASS’’

• the Central Clearing and Settlement System established and operated by HKSCC

• ‘‘CCASS Clearing Participant’’

• a person admitted by HKSCC to participate in CCASS as a direct clearing participant/broker participant or general clearing participant

• ‘‘CCASS Custodian Participant’’

• a person admitted by HKSCC to participate in CCASS as a custodian participant

• ‘‘CCASS Investor Participant’’

• a person admitted by HKSCC to participate in CCASS as an investor participant who may be an individual or joint individuals or a corporation

• ‘‘CCASS Participant’’

• a CCASS Clearing Participant or a CCASS Custodian Participant or a CCASS Investor Participant

• ‘‘Closing Date’’

• the date on which the obligations of the Underwriters under the Underwriting Agreement become unconditional, which is expected to be Wednesday, 5 August 2015 or such later date as the Company and the Underwriters may agree in writing

• ‘‘CNEEC’’

• China National Electric Equipment Corporation

• ‘‘Companies Ordinance’’

• the Companies Ordinance (Chapter 622 of the Laws of Hong Kong)

– 1 –

DEFINITIONS

• ‘‘Companies (Winding Up and Companies (Winding Up and Miscellaneous Provisions) Miscellaneous Provisions) Ordinance (Chapter 32 of the Laws of Hong Kong) Ordinance’’

• ‘‘Company’’ or ‘‘IRC’’

• IRC Limited (Stock Code: 1029), a company incorporated in Hong Kong with limited liability, the Shares of which are listed on the Stock Exchange

• ‘‘Despatch Date’’

• Friday, 17 July 2015 or such later date as may be agreed between the Company and the Underwriters for the despatch of the Prospectus Documents

• ‘‘Director(s)’’ the director(s) of the Company

• ‘‘Executive Directors’’

• the executive Directors of the Company, Mr George Jay Hambro and Mr Yury Makarov

• ‘‘Executive Directors’ the irrevocable undertakings given by the Executive Directors Undertakings’’ to the Underwriters pursuant to which each Executive Director has undertaken to subscribe for his or procure the subscription by the Registered Owner(s) of its/their full entitlement of Offer Shares

• ‘‘General Nice’’ General Nice Development Limited, a limited liability company incorporated under the laws of Hong Kong

• ‘‘General Nice Subscription the conditional subscription agreement dated 17 January 2013 Agreement’’ entered into between General Nice and the Company relating to the subscription of new Shares by General Nice

• ‘‘Group’’ the Company and its subsidiaries from time to time

• ‘‘HK$’’ Hong Kong dollars, the lawful currency of Hong Kong

• ‘‘HKFRS’’ Hong Kong Financial Reporting Standards

• ‘‘HKSCC’’ Hong Kong Securities Clearing Company Limited ‘‘Hong Kong’’ the Hong Kong Special Administrative Region of the People’s Republic of China

‘‘ICBC’’ Industrial and Commercial Bank of China Limited, a company listed on the Stock Exchange (Stock code: 1398)

– 2 –

DEFINITIONS

• ‘‘ICBC Facility Agreement’’ the US$340,000,000 credit facility agreement dated 13 December 2010 entered into between, inter alia, ICBC (as facility agent), K&S (as borrower) and Petropavlovsk (as guarantor)

• ‘‘INCOTERM’’ the International Commercial Terms published by the International Chamber of Commerce and as amended from time to time

• ‘‘Intermediary’’ in relation to a Beneficial Owner whose Shares are deposited in CCASS and registered in the name of HKSCC Nominees Limited, means the Beneficial Owner’s broker, custodian, nominee or other relevant person who is a CCASS Participant or who has deposited the Beneficial Owner’s Shares with a CCASS Participant

• ‘‘Irrevocable Undertaking’’

• the irrevocable undertaking given by Petropavlovsk to the Underwriters pursuant to which Petropavlovsk has undertaken to procure that Cayiron will not subscribe for its full entitlement of Offer Shares

• ‘‘JABCAP’’

• JABCAP Multi Strategy Master Fund Limited

• ‘‘K&S’’

• Kimkano-Sutarsky Mining and Beneficiation Plant LLC (also known as LLC KS GOK), a wholly-owned subsidiary of the Company

• ‘‘K&S Project’’

• the projects to explore, develop and/or exploit iron ore product at the Kimkan mine (the areas currently the subject of production licence number BIR 14037 TE) and the Sutara mine (the areas currently the subject of combined licence for exploration and production number BIR 14038 TE) located in the Jewish Autonomous Region of the Russian Federation

• ‘‘Kuranakh’’

• the Group’s titanomagnetite and ilmenite project currently in production, consisting of the Saikta deposit and the Kuranakh deposit, which is situated in the Amur Region of the Russian Federation

• ‘‘Last Trading Day’’

• Friday, 26 June 2015, being the last full trading date for the Shares before the release of the Announcement

• ‘‘Latest Lodging Date’’

• 4:30 p.m. on Monday, 13 July 2015, being the latest time for lodging transfer of Shares for registration in order to qualify for the Open Offer

– 3 –

DEFINITIONS

• ‘‘Latest Practicable Date’’

Tuesday, 14 July 2015, being the latest practicable date prior to the printing of this Prospectus for the purpose of ascertaining certain information in this Prospectus

• ‘‘Latest Time for Acceptance’’

• 4:00 p.m. on Friday, 31 July 2015 (or any such other date as the Underwriters may agree in writing with the Company as the latest date for acceptance of, and payment for, Offer Shares)

• ‘‘Latest Time for Termination’’

• 4:00 p.m. on the Closing Date, or such later date as the Company and the Underwriters may agree in writing

• ‘‘Listing Committee’’

• the listing committee of the Stock Exchange

• ‘‘Listing Rules’’

• the Rules Governing the Listing of Securities on the Stock Exchange

• ‘‘Long Stop Date’’

• Monday, 31 August 2015 or such later date as the Underwriters may agree

• ‘‘Long Term Incentive Plan’’

• the long term incentive plan of the Company

• ‘‘Main Board’’ the Main Board of the Stock Exchange

• ‘‘Minmetals Cheerglory’’

• Minmetals Cheerglory Limited, a limited liability company incorporated under the laws of Hong Kong

• ‘‘Minmetals Cheerglory Subscription Agreement’’

• the conditional subscription agreement dated 17 January 2013 entered into between Minmetals Cheerglory and the Company relating to the subscription of new Shares by Minmetals Cheerglory

• ‘‘NASDAQ’’

• the National Association of Securities Dealers Automated Quotations

• ‘‘Non-Qualifying Shareholder(s)’’

• those Overseas Shareholder(s) and other person(s) to whom the Directors, after making relevant enquiries, consider it necessary or expedient not to offer the Offer Shares on account of either the legal restrictions under the laws of a place outside Hong Kong or the requirements of the relevant regulatory body or stock exchange in that place, as more fully described under the paragraph headed ‘‘Qualifying Shareholders’’ in the section headed ‘‘Letter from the Board’’ of this Prospectus

– 4 –

DEFINITIONS

• ‘‘Offer Shares’’

• not less than 1,295,976,080 new Shares to be offered to the Qualifying Shareholders for subscription pursuant to Open Offer

• ‘‘Open Offer’’ the proposed issue of Offer Shares by the Company on the basis of 4 Offer Shares for every 15 Shares held on the Record Date at the Subscription Price on the terms and subject to the conditions set out in the Underwriting Agreement and the Prospectus Documents

• ‘‘Overseas Shareholder(s)’’

• the Shareholder(s) whose names appear on the register of members of the Company as at the close of business on the Record Date and whose address(es) as shown on such register is/are outside Hong Kong

• ‘‘Permitted Territories’’ Hong Kong, the Cayman Islands and the British Virgin Islands

• ‘‘Petropavlovsk’’

• Petropavlovsk plc, a public company incorporated under the laws of England and Wales with registered number 04343841 and listed on the Main Market of the London Stock Exchange

• ‘‘Pine River’’ Pine River Lux Investments S.a.r.l.

• ‘‘PRC’’

• the People’s Republic of China, which for the purpose of this Prospectus excludes Hong Kong, Macau Special Administrative Region of the People’s Republic of China and Taiwan

• ‘‘Prospectus’’

• this prospectus issued by the Company in relation to the Open Offer

• ‘‘Prospectus Documents’’ collectively, the Prospectus and the Application Form(s)

• ‘‘Qualifying Shareholder(s)’’

• the Shareholder(s) whose name(s) appear on the register of members of the Company as at the close of business on the Record Date, other than the Non-Qualifying Shareholders

• ‘‘Record Date’’ Wednesday, 15 July 2015 or such other date as the Underwriters may agree in writing with the Company as the date by reference to which entitlements to the Open Offer are expected to be determined

• ‘‘Registered Owner’’

• in respect of a Beneficial Owner, means a nominee, trustee, depository or any other authorised custodian or third party which is the registered holder in the register of members of the Company of the Shares in which the Beneficial Owner is beneficially interested

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DEFINITIONS

• ‘‘Registrar’’ Tricor Investor Services Limited, whose address is at Level 22, Hopewell Centre, 183 Queen’s Road East, Hong Kong

• ‘‘Rouble’’ Russian rouble, the lawful currency of Russia ‘‘Russia’’ the Russian Federation ‘‘SFC’’ the Securities and Futures Commission of Hong Kong ‘‘SFO’’ the Securities and Futures Ordinance (Chapter 571 of the Laws of Hong Kong)

• ‘‘Shares’’ the ordinary shares in the share capital of the Company ‘‘Shareholders’’ the holders of issued Shares ‘‘Share Mortgage’’ the share mortgage deed under which Cayiron has mortgaged 521,376,470 Shares to ICBC in relation to the ICBC Facility Agreement

• ‘‘Sothic Capital’’ Sothic Capital European Opportunities Master Fund Limited ‘‘Stock Exchange’’ The Stock Exchange of Hong Kong Limited ‘‘Subscription Price’’ the subscription price of HK$0.315 per Offer Share ‘‘Takeovers Code’’ the Code on Takeovers and Mergers issued by the Securities and Futures Commission of Hong Kong

• ‘‘Underwriters’’ Pine River, Sothic Capital and JABCAP, collectively, each an ‘‘Underwriter’’

• ‘‘Underwriting Agreement’’ the underwriting agreement dated 29 June 2015 and entered into between the Company and the Underwriters in relation to the underwriting and certain other arrangements in respect of the Open Offer

• ‘‘Underwritten Shares’’ the Offer Shares underwritten by the Underwriters pursuant to the terms of the Underwriting Agreement, being all the Offer Shares

• ‘‘United Kingdom’’ or ‘‘UK’’ the United Kingdom of Great Britain and Northern Ireland ‘‘United States’’ or ‘‘US’’ the United States of America (including its territories and dependencies, any state in the US and the District of Columbia)

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DEFINITIONS

‘‘US$’’ United States dollars, the lawful currency of the United States

‘‘%’’ per cent or percentage

In this Prospectus, unless the context otherwise requires, any reference to the singular includes the plural and vice versa and any reference to a gender includes a reference to the other gender and the neuter.

In this Prospectus, unless the context otherwise requires, the terms ‘‘associate’’, ‘‘connected person’, ‘‘connected transaction’’, ‘‘controlling shareholder’’, ‘‘subsidiary’’ and ‘‘substantial shareholder’’ shall have the meanings given to such terms in the Listing Rules, as modified by the Stock Exchange from time to time.

In this Prospectus, the exchange rate of US$1 to HK$7.76 has been used for conversion into the relevant currencies for illustrative purposes only.

Certain amounts and percentage figures set out in this Prospectus have been subject to rounding adjustments. Accordingly, figures shown as totals in certain tables and the currency conversion or percentage equivalents may not be an arithmetic sum of such figures

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EXPECTED TIMETABLE

The expected timetable for the Open Offer is set out below:

Latest time for acceptance of, and payment for,

the Offer Shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4:00 p.m. on Friday, 31 July 2015

Open Offer expected to become unconditional . . . . . . . . . . 4:00 p.m. on Wednesday, 5 August 2015

Announcement of results of the Open Offer to

be published on the respective websites of the

Stock Exchange and the Company on or before . . . . . . . . . . . . . . . . . . . . . . Thursday, 6 August 2015

• Despatch of Share certificates for fully-paid Offer Shares

• (or refund cheques if Open Offer

• is terminated) on or around . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Friday, 7 August 2015

Dealings in fully-paid Offer Shares commences . . . . . . . . . . . 9:00 a.m. on Monday, 10 August 2015

All times and dates in this Prospectus refer to Hong Kong local times and dates. Dates or deadlines specified in the expected timetable above or in other parts of this Prospectus are indicative only and may be extended or varied by agreement between the Company and the Underwriters. Any changes to the expected timetable will be published or notified to the Shareholders and the Stock Exchange as and when appropriate.

EFFECT OF BAD WEATHER ON THE LATEST TIME FOR ACCEPTANCE OF AND PAYMENT FOR THE OPEN OFFER

The Latest Time for Acceptance will not take place at 4:00 p.m. on Friday, 31 July 2015 if there is:

• (a) a tropical cyclone warning signal number 8 or above, or

• (b) a ‘‘black’’ rainstorm warning,

• (i) in force in Hong Kong at any local time before 12:00 noon and no longer in force after 12:00 noon on Friday, 31 July 2015. Instead the Latest Time for Acceptance will be extended to 5:00 p.m. on the same Business Day; or

• (ii) in force in Hong Kong at any local time between 12:00 noon and 4:00 p.m. on Friday, 31 July 2015. Instead the Latest Time for Acceptance will be rescheduled to 4:00 p.m. on the following Business Day which does not have either of those warnings in force in Hong Kong at any time between 9:00 a.m. and 4:00 p.m..

If the Latest Time for Acceptance does not take place on Friday, 31 July 2015, the dates mentioned in the section headed ‘‘Expected Timetable’’ in this Prospectus may be affected. An announcement will be made by the Company in such event.

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SUMMARY OF THE OPEN OFFER

The following information is derived from, and should be read in conjunction with, the full text of this Prospectus:

Basis of the Open Offer : 4 Offer Shares for every 15 Shares held on the Record Date Number of Shares in issue as at : 4,859,910,301 Shares the Latest Practicable Date Number of Offer Shares : 1,295,976,080 Offer Shares (assuming no new Shares were issued and no Share repurchases were made on or before the Record Date) Number of Underwritten Shares : 1,295,976,080 Offer Shares, being all the Offer Shares Enlarged issued share capital upon : 6,155,886,381 Shares completion of the Open Offer Subscription Price : HK$0.315 per Offer Share Amount to be raised : Approximately HK$408 million (approximately US$52.6 million) before expenses Underwriters : Pine River Sothic Capital JABCAP

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TERMINATION OF THE UNDERWRITING AGREEMENT

The Open Offer is conditional upon the Underwriting Agreement becoming unconditional and not being terminated in accordance with its terms. Pine River together with any other Underwriter may, in their sole and absolute discretion (acting in good faith), by notice in writing to the Company, served prior to the Latest Time for Termination, rescind or terminate the Underwriting Agreement if:

• (A) any matter or circumstances arises as a result of which any of the conditions to the Underwriting Agreement has become incapable of satisfaction as at the required time; or

• (B) any of the warranties given by the Company become untrue, inaccurate or misleading or any matter has arisen or event occurred which could reasonably be expected to give rise to any of the warranties given by the Company becoming untrue, inaccurate or misleading; or

• (C) any material breach of any of the Company’s undertakings or obligations under the Underwriting Agreement; or

• (D) any statement contained in the Prospectus has become or been discovered to be untrue, incorrect, incomplete or misleading in any material respect; or

• (E) there is any adverse change in the business, assets, results of operations, shareholders’ equity or in the financial or trading position or prospects of the Group taken as a whole which is material to the Group or in the context of the Open Offer or the Underwriters’ obligations under the Underwriting Agreement; or

• (F) permission to deal in and listing of all the Offer Shares has been withdrawn by the Stock Exchange; or

• (G) any condition to enable the Offer Shares to be admitted as eligible securities for deposit, clearance and settlement in CCASS is not satisfied or notification is received by the Company from HKSCC that such admission of facility for holding and settlement has been or is to be refused; or

• (H) any matter arises or is discovered which requires the Company to issue a supplementary prospectus; or

• (I) there has occurred, happened, come into effect or become public knowledge any event, series of events or circumstances concerning or relating to (whether or not foreseeable):

• (i) any change in (whether or not permanent) local, national or international financial, political, military, industrial, economic, legal, fiscal, regulatory or securities market matters or conditions or currency exchange rates or exchange controls in the Hong Kong; or

• (ii) any event or circumstance in the nature of force majeure including, without limitation, any act of government, economic sanctions, strike or lock-out (whether or not covered by insurance), riot, fire, explosion, flooding, earthquake, civil commotion, act or declaration of war, outbreak or escalation of hostilities (whether or not war is or has been declared), act of terrorism (whether or not responsibility

– 10 –

TERMINATION OF THE UNDERWRITING AGREEMENT

has been claimed), act of God, pandemic, epidemic, outbreak of infectious disease, declaration of a state of emergency or calamity or crisis, in or affecting Hong Kong; or

• (iii) the declaration of a banking moratorium on commercial banking activities by the PRC, Hong Kong, United Kingdom or United States authorities; or

• (iv) any moratorium, suspension or restriction on trading in shares or securities generally, or the establishment of minimum prices, on the Stock Exchange, the London Stock Exchange plc, the New York Stock Exchange, Inc. or NASDAQ, or any major disruption in commercial banking or securities settlement or clearing services in Hong Kong; or

• (v) any new law or regulation or any change, or any development involving a prospective change, in existing laws or regulations in Hong Kong or any other place in which any member of the Group conducts or carries on business; or

• (vi) any suspension of dealings in the Shares (other than (i) pending publication of announcements in respect of the Open Offer or (ii) a suspension which is not connected to an event or occurrence that is material in the context of the Open Offer and such suspension does not continue beyond the trading day on which it commenced),

the effect of which events and circumstances referred to in paragraph (I) above, individually or in the aggregate is or would be likely to be materially adverse to, or prejudicially affects or would be likely to prejudicially affect, the Group as a whole or the Open Offer or dealings in the Offer Shares in the secondary market.

Upon such notice being given by Pine River together with any other Underwriter, the obligations of the parties under the Underwriting Agreement shall terminate forthwith and no party will have any claim against any other for costs, damages, compensation or otherwise (save in respect of certain rights or obligations under the Underwriting Agreement including rights of the parties thereto in respect of any antecedent breach). If Pine River and any other Underwriter exercise such right, the Open Offer will not proceed and a further announcement will be made.

WARNING OF THE RISKS OF DEALING IN THE SHARES

The Underwriting Agreement contains provisions granting Pine River and any other Underwriter a right to terminate the Underwriters’ obligations under the Underwriting Agreement upon the occurrence of certain events. Please refer to the paragraphs headed ‘‘Underwriting Arrangements’’ in the section headed ‘‘Letter from the Board’’ of this Prospectus for further details.

The Open Offer is conditional upon the Underwriting Agreement becoming unconditional and not being terminated in accordance with its terms. If any of the conditions of the Open Offer as set out in the paragraphs headed ‘‘Conditions of the Open Offer and the Underwriting Agreement’’ in the section headed ‘‘Letter from the Board’’ of this Prospectus is not fulfilled or waived, the Open Offer will not proceed, in which case a further announcement will be made by the Company at the relevant time.

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LETTER FROM THE BOARD

==> picture [140 x 72] intentionally omitted <==

(Incorporated in Hong Kong with limited liability)

(Stock Code: 1029)

Executive Directors:

Mr George Jay Hambro (Chairman) Mr Yury Makarov (Chief Executive Officer)

Registered office:

6H, 9 Queen’s Road Central Hong Kong

Non-executive Directors:

Mr Simon Murray, CBE, Chevalier de la Légion d’Honneur

Mr Cai Sui Xin Mr Liu Qingchun Mr Raymond Kar Tung Woo

Independent non-executive Directors:

Mr Daniel Rochfort Bradshaw Mr Chuang-fei Li Mr Jonathan Martin Smith

17 July 2015

• To the Qualifying Shareholders and, for information only, certain Non-Qualifying Shareholders

Dear Sir or Madam,

OPEN OFFER ON THE BASIS OF 4 OFFER SHARES FOR EVERY 15 SHARES HELD ON THE RECORD DATE AT THE SUBSCRIPTION PRICE OF HK$0.315 PER OFFER SHARE

INTRODUCTION

On Monday, 29 June 2015, the Company announced that it proposed to raise approximately HK$408 million (approximately US$52.6 million), before expenses, by way of the Open Offer of 1,295,976,080 Offer Shares to the Qualifying Shareholders on the basis of 4 Offer Shares for every 15 Shares held on the Record Date at the Subscription Price of HK$0.315 per Offer Share payable in full upon application.

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LETTER FROM THE BOARD

The estimated net proceeds of the Open Offer will be approximately HK$383 million (approximately US$49.4 million). The Company intends to apply the net proceeds of the Open Offer to finance the completion of construction of the Company’s K&S Project and bring it into full commercial production and for providing general working capital to the Group.

The Open Offer is only available to the Qualifying Shareholders and will not be available to the Non-Qualifying Shareholders. No Qualifying Shareholder is entitled to apply for any Offer Shares which are in excess of his/her/its entitlement.

As at the Latest Lodging Date, the Company had 4,859,910,301 Shares in issue. Given that the register of members was closed from Tuesday, 14 July 2015 (being the business day immediately after the Latest Lodging Date and also the Latest Practicable Date) to Wednesday, 15 July 2015 (both days inclusive), and assuming no new Shares were issued and no Shares were repurchased on or before the Record Date, the total number of issued Shares on the Record Date would be the same as on the Latest Lodging Date and on the Latest Practicable Date. Accordingly, on the basis of 4 Offer Shares for every 15 Shares held on the Record Date, 1,295,976,080 Offer Shares will be allotted and issued by the Company.

The allotment and issue of 1,295,976,080 Offer Shares represents (a) approximately 26.7% of the Company’s issued share capital as at the Latest Practicable Date; and (b) approximately 21.1% of the Company’s issued share capital as enlarged by the allotment and issue of the 1,295,976,080 Offer Shares immediately after completion of the Open Offer. Accordingly, a Shareholder who elects not to subscribe for any of his/her/its assured entitlement to the Offer Shares will see a 21.1% dilution of his/her/its shareholding in the Company immediately after completion of the Open Offer.

The purpose of this Prospectus is to provide you with further information relating to the Open Offer, including information on procedures for application and payment for the Offer Shares, as well as financial information and other information of the Group.

THE OPEN OFFER

Open Offer statistics

Basis of the Open Offer: 4 Offer Shares for every 15 Shares held on the Record Date Number of Shares in issue as at 4,859,910,301 Shares the Latest Practicable Date:

Number of Offer Shares: 1,295,976,080 Offer Shares (assuming no new Shares were issued and no Share repurchases were made on or before the Record Date)

Number of Underwritten Shares: 1,295,976,080 Offer Shares, being all the Offer Shares

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LETTER FROM THE BOARD

Enlarged issued share capital upon 6,155,886,381 Shares completion of the Open Offer:

Subscription Price: HK$0.315 per Offer Share

Amount to be raised: Approximately HK$408 million (approximately US$52.6 million) before expenses

Save as disclosed in the section headed ‘‘Share Capital — General Nice and Minmetals Cheerglory Subscriptions’’ in Appendix III — General Information of this Prospectus, as at the Latest Practicable Date, the Company had no outstanding derivatives, options, warrants, conversion rights or other similar rights which are convertible or exchangeable into or confer any right to subscribe for Shares.

The offer ratio of 4 Offer Shares for every 15 Shares held by a Shareholder was arrived at after considering the amount of funds which the Company required to finance the completion of the final stage of construction of its K&S Project, the Subscription Price, and the potential dilution effect on a Shareholder if he/she/it chose not to subscribe for any of his/her/its assured entitlement to the Offer Shares under the Open Offer.

Subscription Price

The Subscription Price of HK$0.315 per Offer Share is payable in full by a Qualifying Shareholder upon application for the Offer Shares under the Open Offer.

The Subscription Price represents:

• (a) a discount of approximately 38.2% to the closing price of HK$0.51 per Share as quoted on the Stock Exchange on the Last Trading Day;

• (b) a discount of approximately 40.6% to the average closing price of HK$0.53 per Share as quoted on the Stock Exchange for the five consecutive trading days up to and including the Last Trading Day;

• (c) a discount of approximately 32.8% to the theoretical ex-entitlement price of approximately HK$0.47 per Share based on the closing price of HK$0.51 per Share as quoted on the Stock Exchange on the Last Trading Day; and

• (d) a discount of approximately 16.0% to the closing price of HK$0.375 per Share as quoted on the Stock Exchange on the Latest Practicable Date.

Given the challenging market conditions for iron ore producers such as the Group, a subscription price which was at a discount to the trading price of the Shares on the Last Trading Date was considered by the Company as necessary for the participation of the Underwriters in the

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LETTER FROM THE BOARD

Open Offer and for the Underwriters to continue to hold the Underwritten Shares during the lock-up period described in the paragraphs headed ‘‘Lock up provisions under the Underwriting Agreement’’ in the section headed ‘‘Underwriting Arrangements’’ in this Letter from the Board.

Due to the low levels of trading in the Shares prior to the Announcement (being a daily average of 0.43% of total issued Shares and a daily average of 1.71% of Shares held by the public for the 19 trading days prior to the Announcement), a subscription price which offered an attractive proposition for investment by the Underwriters was also required as there was a high likelihood that there would not be any willing or available buyers if (or when) the Underwriters chose to sell the Underwritten Shares after the expiry of the lock-up period.

Taking into account the above, the Subscription Price of HK$0.315 was agreed between the Company and Pine River and the other Underwriters after arm’s length negotiations.

Each Qualifying Shareholder will be entitled to subscribe for the Offer Shares in proportion to his/her/its shareholding held on the Record Date at the Subscription Price.

The Directors (including the independent non-executive Directors) consider the terms of the Open Offer, including the Subscription Price (and the discounts to the relative values as indicated above), to be fair and reasonable and in the best interests of the Company and the Shareholders as a whole.

Qualifying Shareholders

The Company will send the Prospectus Documents to the Qualifying Shareholders only. To qualify for the Open Offer, a Shareholder must be registered as a member of the Company and not be a Non-Qualifying Shareholder at the close of business on the Record Date. Accordingly, Shareholders wishing to qualify for the Open Offer must have lodged any transfers of Shares (together with the relevant share certificates) with the Registrar by no later than 4:30 p.m. on Monday, 13 July 2015.

Non-Qualifying Shareholders are (i) any Overseas Shareholder(s) whose address on the register of members is outside of the Permitted Territories; and (ii) any Shareholders and Beneficial Owners who are known by the Company to be residents of places outside of the Permitted Territories, unless they are otherwise determined by the Company to be entitled to subscribe for their entitlement for the Offer Shares.

Having reviewed the register of members as at the Latest Lodging Date, the Company noted that there were three Shareholders whose addresses on the register of members were outside Hong Kong, with two Overseas Shareholders with addresses in the British Virgin Islands holding an aggregate of 57,352,941 Shares and one Overseas Shareholder with address in the Cayman Islands holding 2,205,900,000 Shares. Given that the register of members of the Company was closed from Tuesday, 14 July 2015 to Wednesday, 15 July 2015 (both dates inclusive) and no Shares were transferred during the book closure period, the register of members on the Record Date was the same as that on the Latest Lodging Date.

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LETTER FROM THE BOARD

The Directors have, in compliance with the requirements specified in Rule 13.36(2)(a) of the Listing Rules (including notes 1 and 2 thereto), conducted enquiries with the Company’s legal advisers regarding the feasibility of extending the Open Offer to such Overseas Shareholders. Based on the advice provided by the legal advisers in the relevant jurisdictions, the Directors believe that the Prospectus Documents would not be required to be registered under the relevant laws and regulations of British Virgin Islands and Cayman Islands and may be despatched to these Overseas Shareholders directly without any restrictions or conditions. In view of this, the Directors have decided to extend the Open Offer to these Overseas Shareholders with registered addresses in British Virgin Islands and Cayman Islands, and such Overseas Shareholders, together with the Shareholders with registered addresses in Hong Kong as at the Record Date, are Qualifying Shareholders. The Company is accordingly extending the Open Offer, and sending the Prospectus Documents, to such Qualifying Shareholders.

As there were no other Shareholders on the register of members as at the Latest Lodging Date with addresses in any territory that is not in the Permitted Territories, if a Shareholder or Beneficial Owner is in fact situated in a territory that is not a Permitted Territory, such Shareholder or Beneficial Owner will be a Non-Qualifying Shareholder.

Notwithstanding any other provision in the Prospectus Documents, in respect of any Shareholder or Beneficial Owner which would otherwise be a Non-Qualifying Shareholder, the Company reserves the right to permit such Shareholder or Beneficial Owner to subscribe for their entitlement for the Offer Shares if the Company, in its absolute discretion, is satisfied that the transaction in question is exempt from or not subject to the legislation or regulations giving rise to the restrictions in question. Beneficial Owners who are situated outside of the Permitted Territories should have regard to the ‘‘Notices to Overseas Investors’’ on pages i to vi of this Prospectus, which set out information relating to certain jurisdictions (on a non-exhaustive basis) where securities laws may restrict participation in the Open Offer by a Beneficial Owner.

The Prospectus Documents are not intended to be, and will not be, registered or filed under the applicable securities laws of any jurisdiction other than Hong Kong. Subject to the advice of the Company’s legal advisers in the relevant jurisdictions and to the extent reasonably practicable and legally permitted, the Company will send copies of the Prospectus to the Non-Qualifying Shareholders for their information only, but will not send any Application Forms to them.

No person receiving a copy of this Prospectus and/or the Application Form in any territory or jurisdiction outside the Permitted Territories may treat it as an offer or an invitation to apply for the Offer Shares, unless in the relevant jurisdiction such an offer or invitation could lawfully be made without compliance with any registration or other legal or regulatory requirements. It is the responsibility of any person outside Hong Kong (including Beneficial Owner(s)) wishing to make an application for the Offer Shares to satisfy himself as to the observance of the laws and regulations of all relevant jurisdictions, including obtaining any government or other consents, and payment of any taxes and duties required to be paid in such jurisdiction in connection therewith. The Company reserves the right to treat as invalid and refuse to accept any application for the Offer Shares where it believes that doing so would violate the applicable securities or other laws or

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LETTER FROM THE BOARD

regulations of any jurisdiction. Completion and return of the Application Form will constitute a warranty and representation by the relevant applicant(s) to the Company that all registration, legal and regulatory requirements of all relevant territories other than Hong Kong in connection with the acceptance of the Offer Shares have been duly complied with by such applicant(s). For the avoidance of doubt, neither HKSCC nor HKSCC Nominees Limited is subject to any of the representations and warranties. If you are in any doubt as to your position, you should consult your professional advisers.

Any Offer Shares which may otherwise have been available for subscription by NonQualifying Shareholders will instead be subscribed by the Underwriters (or persons procured by them) in accordance with the Underwriting Agreement.

Shareholders should refer to the section headed ‘‘Procedures for acceptance and payment for the Offer Shares’’ in this Letter from the Board for further details on how to apply and pay for the Offer Shares and the actions to be taken by Beneficial Owners (if applicable).

No trading of nil-paid entitlements

The invitations to apply for the Offer Shares to be made to the Qualifying Shareholders are not transferable or capable of renunciation. There will not be any trading of nil-paid entitlements of the Offer Shares on the Stock Exchange.

Status of the Offer Shares

The Offer Shares (when allotted, issued and fully paid) will rank pari passu with the then existing Shares in issue in all respects. Holders of fully-paid Offer Shares will be entitled to receive all future dividends and distributions which may be declared, made or paid after the date of allotment and issue of the Offer Shares.

Share certificates and refund cheques for the Open Offer

Subject to the fulfilment of the conditions of the Open Offer, certificates for all fully paid Offer Shares are expected to be posted to those entitled thereto by ordinary post at their own risk on or around Friday, 7 August 2015. Each successful applicant will receive one share certificate for all the fully-paid Offer Shares allotted and issued to him/her/it.

If the Underwriting Agreement is terminated on or before the Latest Time for Termination and the Open Offer does not become unconditional, refund cheques will be despatched on or before Friday, 7 August 2015 by ordinary post at the respective Shareholders’ own risk.

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LETTER FROM THE BOARD

No excess application for the Offer Shares

No Qualifying Shareholder will be entitled to apply for any Offer Shares which are in excess of his/her/its entitlement. Any Offer Shares not taken up by the Qualifying Shareholders, and the Offer Shares to which the Non-Qualifying Shareholders would otherwise have been entitled under the Open Offer, will not be available for subscription by other Qualifying Shareholders by way of excess application and will instead be underwritten by the Underwriters.

The Open Offer provides the Qualifying Shareholders with a fair and equal opportunity to maintain their respective pro rata shareholding in the Company and to participate in the future growth potential of the Company through financing the completion of construction and commencement of full commercial production at the Company’s K&S Project. The use of excess applications would permit excess applicants to increase disproportionately their holding in the Company and go against the principle of fair opportunity to all Qualifying Shareholders.

Arranging excess application procedures would also require additional effort and costs to administer. It is estimated by the Company that the additional costs and expenses, including additional fees payable to the Registrar, legal advisers and other professional services providers, would be approximately HK$150,000. As the Company is seeking to reduce all unnecessary expenses so as to receive the maximum net proceeds from the Open Offer, it was the view of the Company that the provision of excess applications procedures was outweighed by the benefit to the Company of increasing the net proceeds while maintaining the Subscription Price which was the price at which the Underwriters were prepared to underwrite the Open Offer.

Taking into account all of the above, the Company considered that it was fair and reasonable not to offer any excess applications in respect of the Offer Shares.

Fractional entitlements to the Offer Shares

Entitlements of Qualifying Shareholders shall be rounded down to the nearest whole number and Qualifying Shareholders shall not be entitled to subscribe for fractions of Offer Shares. All fractional entitlements to the Offer Shares created from the said rounding down will be aggregated and underwritten by the Underwriters.

No odd lot matching service

No odd lot matching services will be provided. Appointing a broker for such service would cost the Company additional expenses of up to HK$50,000. In this regard, it was considered that appointing a broker to stand in the market to provide an odd lot matching service would not be cost-effective considering the fees that the broker will charge for such service in addition to the underwriting commission already payable on such Offer Shares and the market value of the odd lots of Offer Shares. As the Company is seeking to reduce all unnecessary expenses so as to receive the maximum net proceeds from the Open Offer, it was the view of the Company that the provision of

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LETTER FROM THE BOARD

odd lot matching services and the benefit that would bring to Shareholders was outweighed by the benefit to the Company of increasing the net proceeds while maintaining the Subscription Price which was the price at which the Underwriters were prepared to underwrite the Open Offer.

Stamp duty and other applicable fees and charges

There will be no dealings in entitlements to Offer Shares. Dealings in the Offer Shares will be subject to the payment of stamp duty, Stock Exchange trading fee, SFC transaction levy and any other applicable fees and charges in Hong Kong.

Application for listing

The Company has applied to the Listing Committee of the Stock Exchange for the listing of, and permission to deal in, the Offer Shares.

No part of the securities of the Company in issue or for which listing or permission to deal is being or is proposed to be sought is listed or dealt in or on any other stock exchange.

Offer Shares will be eligible for admission into CCASS

Subject to the granting of the listing of, and permission to deal in, the Offer Shares on the Stock Exchange as well as compliance with the stock admission requirement of HKSCC, the Offer Shares will be accepted as eligible securities by HKSCC for deposit, clearance and settlement in CCASS with effect from the commencement date of dealings in the Offer Shares on the Stock Exchange or such other dates as determined by HKSCC. Settlement of transactions between participants of the Stock Exchange on any trading day is required to take place in CCASS on the second trading day thereafter. All activities under CCASS are subject to the General Rules of CCASS and CCASS Operational Procedures in effect from time to time.

Shareholders should seek advice from their licensed securities dealers or other professional advisers for details of those settlement arrangements and how such arrangements will affect their rights and interests.

The board lot size for the Offer Shares is 2,000 Shares.

CONDITIONS OF THE OPEN OFFER AND THE UNDERWRITING AGREEMENT

The Open Offer is conditional upon the Underwriting Agreement becoming unconditional and not being terminated in accordance with its terms. The obligations of the Underwriters under the Underwriting Agreement are conditional upon, among others:

• (a) permission to deal in and listing of all the Offer Shares being granted (subject only to allotment and despatch of the appropriate documents of title) by the Stock Exchange by no later than the business day prior to the commencement of trading of the Offer Shares and such permission not being withdrawn or revoked prior to the Latest Time for Termination;

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LETTER FROM THE BOARD

• (b) the registration and filing of the Prospectus Documents with the Registrar of Companies in Hong Kong;

• (c) all relevant consents and approvals being obtained from all relevant governmental and regulatory authorities, including the Stock Exchange and the SFC, by the Company, as the case may require in connection with the Open Offer by the relevant time that each consent and approval is required;

• (d) each condition to enable the Offer Shares to be admitted as ‘‘eligible securities’’ in CCASS and no notice being received of refusal to admit the Offer Shares to CCASS;

• (e) compliance by the Company with its obligations in connection with making the Open Offer and the allotment and offer of the Offer Share by the times specified;

• (f) compliance by Petropavlovsk with its obligations under the Irrevocable Undertaking and by the Executive Directors with their obligations under the Executive Directors’ Undertakings;

• (g) receipt by the Underwriters (in a form satisfactory to them) of all relevant documents by the times specified in the Underwriting Agreement;

• (h) in respect of the warranties and the undertakings contained the Underwriting Agreement, by the Latest Time for Termination (i) the warranties being true and accurate and not misleading at all times prior to the Latest Time for Termination; (ii) no material breach of any of the warranties or the undertakings; and (iii) a matter not having arisen which would reasonably be expected to give rise to a material breach or a material claim; and

• (i) no event of default having occurred under the ICBC Facility Agreement and no other event having occurred which would entitle the security agent to take steps to enforce the security created under the Share Mortgage.

None of the above conditions have been fulfilled as at the Latest Practicable Date. The Company shall use its reasonable endeavours to procure the fulfilment of each of the above conditions within the relevant time referred to in each case (or if no date is specified, by the Latest Time for Termination) and to procure that each of the above conditions is fulfilled in sufficient time so that the Latest Time for Termination falls on or before the Long Stop Date and in particular shall furnish such information, supply such documents, pay such expenses, give such undertakings and do all such acts and things as may be reasonably required by the Underwriters and the Stock Exchange in connection with the making of the Open Offer and the listing of the Offer Shares.

If (i) any of the above conditions shall not have been fulfilled or waived in accordance with the terms of the Underwriting Agreement by the specified time and date and in any event by the Long Stop Date or (ii) the Latest Time for Termination occurs, or will occur, after the Long Stop Date, the Underwriting Agreement shall terminate (save in respect of certain rights and obligations under the Underwriting Agreement) and the Open Offer will not proceed.

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LETTER FROM THE BOARD

The Underwriters acting together shall have the right, in their absolute discretion, by giving notice to the Company on or before the latest time at which, or the latest day on which, any of the above conditions may be fulfilled:

• (i) to extend the deadline for the fulfilment of such condition by such time or number of days or in such manner as the Underwriters may determine; or

• (ii) to waive such condition (other than conditions (a) to (d) above), and such waiver may be made subject to such terms and conditions as the Underwriters may determine.

UNDERWRITING ARRANGEMENTS

The Underwriting Agreement

Date: 29 June 2015

Underwriters:

Pine River Sothic Capital JABCAP

Number of Underwritten Shares: 1,295,976,080 Offer Shares, being all the Offer Shares

The Underwriters’ Commission: 5.0% of the aggregate Subscription Price of the total number of Offer Shares

Subject to the fulfilment of the conditions (or any waiver, as the case may be, by the Underwriters) contained in the Underwriting Agreement and provided that the Underwriting Agreement is not terminated prior to the Latest Time for Termination in accordance with the terms thereof, the Underwriters have agreed to subscribe or procure the subscription for all Underwritten Shares that are not otherwise taken up in the following proportions:

Pine River 75% Sothic Capital 15% JABCAP 10%*

• The underwriting proportions of the Underwriters are subject to re-allocation among them to ensure that the Company meets the public float requirements under Listing Rule 8.08. In the event that the number of Offer Shares to be subscribed by Pine River would result in Pine River becoming a substantial shareholder (as defined in the Listing Rules) of the Company and the Company thereby ceasing to meet the requirements of Listing Rule 8.08, the underwriting obligations of Pine River will be reduced by such number of Offer Shares as would result in either (a) Pine River not becoming a substantial shareholder (as defined in the Listing Rules) or (b) the public float of the Company meeting the requirements of Listing Rule 8.08, and such number of Offer Shares being reallocated to Sothic Capital and JABCAP on a pro rata basis.

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LETTER FROM THE BOARD

The commission payable to the Underwriters under the Underwriting Agreement was determined after arm’s length negotiations between the Company and the Underwriters by reference to the market rate. The Directors (including the independent non-executive Directors) consider the terms of the Underwriting Agreement including the commission rate to be fair and reasonable and in the interests of the Company and the Shareholders as a whole.

To the best of the Directors’ knowledge, information and belief, having made all reasonable enquiries, each Underwriter is an independent third party.

Irrevocable Undertaking

Petropavlovsk, the Company’s indirect controlling shareholder, has irrevocably undertaken to the Underwriters that it will procure that its wholly-owned subsidiary Cayiron will not subscribe for the 588,240,000 Offer Shares to which it is entitled under the Open Offer and that Cayiron will not, at any time until 5 September 2015, sell, transfer or otherwise dispose of, or enter into any agreement for the sale, transfer or disposal of any Shares held by it or any interest therein, or agree to grant any option, warrant or other right carrying the right to acquire any of such Shares or enter into any swap, derivative or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of any of such Shares, save in respect of intra-group transfers, transfers in order to allow the Company to meet its public float requirements, transfers resulting from enforcement of securities, and certain grants of security over such Shares.

Executive Directors’ Undertakings

Each of the Executive Directors, Mr George Jay Hambro and Mr Yury Makarov, has irrevocably undertaken to the Underwriters that he would subscribe or procure the Registered Owner(s) subscribe under the Open Offer in full for all entitlements relating to Shares in which he is interested, being 6,285,866 Offer Shares and 5,481,466 Offer Shares, respectively. This excludes entitlements in respect of unvested awards under the Company’s Long Term Incentive Plan.

Lock up provisions under the Underwriting Agreement

The Company has undertaken to the Underwriters that, for the period from the date of the Underwriting Agreement until 5 September 2015, except (i) in respect of Shares it has already contractually committed to issue, (ii) in connection with any long-term employee benefit plan, (iii) the Offer Shares, or (iv) otherwise with the prior written consent of the Underwriters, the Company will not:

• (i) allot or issue or offer to allot or issue or grant any option, right or warrant to subscribe (either conditionally or unconditionally, or directly or indirectly, or otherwise) any Shares or any interests in Shares or any securities convertible into or exercisable or exchangeable for or substantially similar to any Shares or interest in Shares;

• (ii) buy back, cancel, retire, reduce, redeem, re-purchase, purchase or otherwise acquire any Shares;

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LETTER FROM THE BOARD

• (iii) agree (conditionally or unconditionally) to enter into or effect any such transaction with the same economic effect as any of the transactions described in paragraph (i) or (ii) above; or

• (iv) announce any intention to enter into or effect any such transaction described in paragraph (i), (ii) or (iii) above.

Each Underwriter has undertaken to the Company that, for the period from the date of the Underwriting Agreement and ending on 5 September 2015, except with the prior written consent of the Company, the Underwriter will not sell, transfer or otherwise dispose of, or enter into any agreement for the sale, transfer or disposal of any of the Underwritten Shares allotted and issued to it (and will procure the same in respect of any Underwritten Shares subscribed by a person nominated by it pursuant to the Underwriting Agreement) or any interest therein, or agree to grant any option, warrant or other right carrying the right to acquire any of such Underwritten Shares or enter into any swap, derivative or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of any of such Underwritten Shares.

Termination of the Underwriting Agreement

Pine River together with any other Underwriter may, in their sole and absolute discretion (acting in good faith), by notice in writing to the Company, served prior to the Latest Time for Termination, rescind or terminate the Underwriting Agreement if:

• (A) any matter or circumstances arises as a result of which any of the conditions to the Underwriting Agreement has become incapable of satisfaction as at the required time; or

• (B) any of the warranties given by the Company become untrue, inaccurate or misleading or any matter has arisen or event occurred which could reasonably be expected to give rise to any of the warranties given by the Company becoming untrue, inaccurate or misleading; or

• (C) any material breach of any of the Company’s undertakings or obligations under the Underwriting Agreement; or

• (D) any statement contained in the Prospectus has become or been discovered to be untrue, incorrect, incomplete or misleading in any material respect; or

• (E) there is any adverse change in the business, assets, results of operations, shareholders’ equity or in the financial or trading position or prospects of the Group taken as a whole which is material to the Group or in the context of the Open Offer or the Underwriters’ obligations under the Underwriting Agreement; or

• (F) permission to deal in and listing of all the Offer Shares has been withdrawn by the Stock Exchange; or

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LETTER FROM THE BOARD

• (G) any condition to enable the Offer Shares to be admitted as eligible securities for deposit, clearance and settlement in CCASS is not satisfied or notification is received by the Company from HKSCC that such admission of facility for holding and settlement has been or is to be refused; or

• (H) any matter arises or is discovered which requires the Company to issue a supplementary prospectus; or

• (I) there has occurred, happened, come into effect or become public knowledge any event, series of events or circumstances concerning or relating to (whether or not foreseeable):

• (i) any change in (whether or not permanent) local, national or international financial, political, military, industrial, economic, legal, fiscal, regulatory or securities market matters or conditions or currency exchange rates or exchange controls in the Hong Kong; or

• (ii) any event or circumstance in the nature of force majeure including, without limitation, any act of government, economic sanctions, strike or lock-out (whether or not covered by insurance), riot, fire, explosion, flooding, earthquake, civil commotion, act or declaration of war, outbreak or escalation of hostilities (whether or not war is or has been declared), act of terrorism (whether or not responsibility has been claimed), act of God, pandemic, epidemic, outbreak of infectious disease, declaration of a state of emergency or calamity or crisis, in or affecting Hong Kong; or

• (iii) the declaration of a banking moratorium on commercial banking activities by the PRC, Hong Kong, United Kingdom or United States authorities; or

• (iv) any moratorium, suspension or restriction on trading in shares or securities generally, or the establishment of minimum prices, on the Stock Exchange, the London Stock Exchange plc, the New York Stock Exchange, Inc. or NASDAQ, or any major disruption in commercial banking or securities settlement or clearing services in Hong Kong; or

• (v) any new law or regulation or any change, or any development involving a prospective change, in existing laws or regulations in Hong Kong or any other place in which any member of the Group conducts or carries on business; or

• (vi) any suspension of dealings in the Shares (other than (i) pending publication of announcements in respect of the Open Offer or (ii) a suspension which is not connected to an event or occurrence that is material in the context of the Open Offer and such suspension does not continue beyond the trading day on which it commenced),

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LETTER FROM THE BOARD

the effect of which events and circumstances referred to in paragraph (I) above, individually or in the aggregate is or would be likely to be materially adverse to, or prejudicially affects or would be likely to prejudicially affect, the Group as a whole or the Open Offer or dealings in the Offer Shares in the secondary market.

Upon such notice being given by Pine River together with any other Underwriter, the obligations of the parties under the Underwriting Agreement shall terminate forthwith and no party will have any claim against any other for costs, damages, compensation or otherwise (save in respect of certain rights or obligations under the Underwriting Agreement including rights of the parties thereto in respect of any antecedent breach). If Pine River and any other Underwriter exercise such right, the Open Offer will not proceed and a further announcement will be made.

EFFECT OF THE OPEN OFFER ON SHAREHOLDING STRUCTURE OF THE COMPANY

The changes in the shareholding structure of the Company arising from the Open Offer are as follows:

Substantial Shareholders Petropavlovsk plc2 General Nice Development Limited Total Substantial Shareholders Directors3 George Jay Hambro Beneficial interest4 Contingent beneficial interest5 Yury Makarov Beneficial interest Contingent beneficial interest5 Raymond Kar Tung Woo Beneficial interest Contingent beneficial interest5 Total Directors Other Shareholders Underwriters Pine River6 Sothic Capital6 JABCAP6 Total Underwriters Other public Shareholders Total Public float	As at the Latest Practicable Date No. of Shares % 2,205,900,000 45.39% 1,365,876,000 28.10% 3,571,776,000 73.49% 23,572,000 0.49% 4,874,539 0.10% 20,555,500 0.42% 4,874,539 0.10% 14,632,500 0.30% 4,874,539 0.10% 73,383,617 1.51% — — — — — — — — 1,214,750,684 25.00% 4,859,910,301 100.00% 1,214,750,684 25.00%	Immediately after completion of the Open Offer assuming all Qualifying Shareholders (other than pursuant to the Irrevocable Undertaking) subscribe fully for their entitlements and no other issues of Shares or Share repurchases1 No. of Shares % 2,205,900,000 35.83% 1,730,109,600 28.10% 3,936,009,600 63.93% 29,857,866 0.49% 6,174,416 0.10% 26,036,966 0.42% 6,174,416 0.10% 18,534,500 0.30% 6,174,416 0.10% 92,952,580 1.51% 441,180,000 7.17% 88,236,000 1.43% 58,824,000 0.96% 588,240,000 9.56% 1,538,684,200 25.00% 6,155,886,381 100.00% 2,126,924,200 34.56%	Immediately after completion of the Open Offer assuming no Qualifying Shareholders (other than pursuant to the Executive Directors’ Undertakings) subscribe for their entitlements and no other issues of Shares or Share repurchases1 No. of Shares % 2,205,900,000 35.83% 1,365,876,000 22.19% 3,571,776,000 58.02% 29,857,866 0.49% 4,874,539 0.08% 26,036,966 0.42% 4,874,539 0.08% 14,632,500 0.24% 4,874,539 0.08% 85,150,949 1.39% 959,987,837 15.59% 194,532,547 3.16% 129,688,365 2.11% 1,284,208,749 20.86% 1,214,750,684 19.73% 6,155,886,381 100.00% 1,538,971,596 25.00%	Immediately after completion of the Open Offer assuming no Qualifying Shareholders (other than pursuant to the Executive Directors’ Undertakings) subscribe for their entitlements and no other issues of Shares or Share repurchases1 No. of Shares % 2,205,900,000 35.83% 1,365,876,000 22.19% 3,571,776,000 58.02% 29,857,866 0.49% 4,874,539 0.08% 26,036,966 0.42% 4,874,539 0.08% 14,632,500 0.24% 4,874,539 0.08% 85,150,949 1.39% 959,987,837 15.59% 194,532,547 3.16% 129,688,365 2.11% 1,284,208,749 20.86% 1,214,750,684 19.73% 6,155,886,381 100.00% 1,538,971,596 25.00%
				58.02%
				0.49% 0.08% 0.42% 0.08% 0.24% 0.08%
				1.39%
				15.59% 3.16% 2.11%
				20.86%
				19.73%
				100.00%
				25.00%

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LETTER FROM THE BOARD

Notes:

1. Certain figures included in the table have been subject to rounding adjustments. Accordingly, figures shown as totals may not be an arithmetic aggregation of the figures preceding them.

2. These Shares are held by Cayiron Limited, a wholly owned subsidiary of Petropavlovsk plc.

3. Does not include the interests of Mr Cai Sui Xin, who is deemed to be interested in the 1,365,876,000 Shares held by General Nice Development Limited under Part XV of the SFO.

4. 23,220,000 Shares were vested to an independent service company providing management services to the Company that is consequently classed as an affiliated company to George Jay Hambro; 352,000 Shares are beneficially owned by Mount F Consulting Limited, which is wholly owned by George Jay Hambro.

5. These relate to unvested Share awards. The vesting of these Shares is subject to the fulfillment of certain conditions and vesting periods in accordance with the Company’s Long Term Incentive Plan.

6. The underwriting proportions of the Underwriters are subject to re-allocation among them to ensure that the Company meets the public float requirements under Listing Rule 8.08. In the event that the number of Offer Shares to be subscribed by Pine River would result in Pine River becoming a substantial shareholder (as defined in the Listing Rules) of the Company and the Company thereby ceasing to meet the requirements of Listing Rule 8.08, the underwriting obligations of Pine River will be reduced by such number of Offer Shares as would result in either (a) Pine River not becoming a substantial shareholder (as defined in the Listing Rules) or (b) the public float of the Company meeting the requirements of Listing Rule 8.08, and such number of Offer Shares being re-allocated to Sothic Capital and JABCAP on a pro rata basis.

PROCEDURES FOR ACCEPTANCE AND PAYMENT FOR THE OFFER SHARES

The Application Form that is enclosed with this Prospectus entitles the Qualifying Shareholder(s) to whom it is addressed to subscribe for the number of Offer Shares as shown therein subject to payment in full by the Latest Time for Acceptance. Qualifying Shareholders should note that they may subscribe for any number of Offer Shares but only up to the number of Offer Shares set out in the Application Form.

If Qualifying Shareholders wish to exercise their rights to subscribe for all the Offer Shares offered to them as specified in the Application Form or to exercise their rights to subscribe for any number of Offer Shares that is less than their full entitlements under the Open Offer, they must complete, sign and lodge the Application Form in accordance with the instructions printed thereon, together with remittance for the full amount payable in respect of such number of Offer Shares they have subscribed for with the Registrar by no later than 4:00 p.m. on Friday, 31 July 2015. All remittance(s) must be made in Hong Kong dollars and cheques must be drawn on an account with, or bankers’ cashier’s orders must be issued by, a licensed bank in Hong Kong and made payable to ‘‘IRC Limited’’ and crossed ‘‘Account Payee Only’’.

It should be noted that unless the duly completed and signed Application Form, together with the appropriate remittance, has been lodged with the Registrar by no later than 4:00 p.m. on Friday, 31 July 2015, the relevant assured allotment of Offer Shares and all rights and entitlements in relation thereto shall be deemed to have been declined and will be cancelled.

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LETTER FROM THE BOARD

The Application Form contains full information regarding the procedures to be followed if you wish to accept the whole or part of your assured entitlement.

All cheques or cashier’s orders accompanying a completed Application Form will be presented for payment upon receipt and all interests earned on such monies (if any) will be retained for the benefit of the Company. Completion and return of an Application Form with a cheque and/or cashier’s order will constitute a warranty by the applicant that the cheque and/or cashier’s order will be honoured on first presentation. Any application in respect of which the cheque or cashier’s order is dishonoured on first presentation is liable to be rejected, and in that event the assured entitlement to the Offer Shares and all rights thereunder will be deemed to have been declined and will be cancelled.

If the conditions of the Open Offer are not fulfilled and/or the Underwriting Agreement is terminated in accordance with its terms before the Latest Time for Termination, the monies received in respect of acceptance of Offer Shares will be refunded, without interest, by sending a cheque made out to the applicant (or in the case of joint applicants, to the first named applicant) and crossed ‘‘Account Payee Only’’, through ordinary post at the risk of the applicant(s) to the address specified in the register of members of the Company on or around Friday, 7 August 2015.

The Prospectus Documents are not intended to be, and will not be, registered or filed under the applicable securities laws of any jurisdiction other than Hong Kong. No person receiving a copy of this Prospectus and/or the Application Form in any territory or jurisdiction outside the Permitted Territories may treat it as an offer or an invitation to apply for the Offer Shares, unless in the relevant jurisdiction such an offer or invitation could lawfully be made without compliance with any registration or other legal or regulatory requirements. It is the responsibility of any person outside Hong Kong (including Beneficial Owner(s)) wishing to make an application for the Offer Shares to satisfy himself as to the observance of the laws and regulations of all relevant jurisdictions, including obtaining any government or other consents, and payment of any taxes and duties required to be paid in such jurisdiction in connection therewith. The Company reserves the right to refuse to accept any application for the Offer Shares where it believes that doing so would violate the applicable securities or other laws or regulations of any jurisdiction. Completion and return of the Application Form will constitute a warranty and representation by the relevant applicant(s) to the Company that all registration, legal and regulatory requirements of all relevant territories other than Hong Kong in connection with the acceptance of the Offer Shares have been duly complied with by such applicant(s). The Company will not allot any fractions of Offer Shares. No odd lot matching services will be provided by the Company in respect of the Open Offer.

The Application Form is for use only by the person(s) named therein and is not transferable.

No receipt will be issued in respect of any application monies received.

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LETTER FROM THE BOARD

Action to be taken by Beneficial Owners whose Shares are held by a Registered Owner (other than through CCASS)

If you are a Beneficial Owner whose Shares are registered in the name of a Registered Owner and you wish to subscribe for Offer Shares relating to your Shares, you should contact the Registered Owner and provide the Registered Owner with instructions or make arrangements with the Registered Owner in relation to the acceptance of your entitlements in sufficient time to ensure your instructions are given effect. Beneficial Owners who are resident outside of the Permitted Territories are not permitted to take up their entitlements if it would be unlawful to make or accept an offer to subscribe for Offer Shares in such territory, or unless the Company otherwise determines, in its absolute discretion, that such Beneficial Owners may take up their entitlements on the basis that the Company is satisfied that the transaction in question is exempt from or not subject to the legislation or regulations giving rise to the restrictions in question.

Action to be taken by Beneficial Owners whose Shares are held by a Registered Owner through CCASS

If you are a Beneficial Owner whose Shares are deposited in CCASS and registered in the name of HKSCC Nominees Limited, and you wish to subscribe for Offer Shares relating to your Shares, you should (unless you are a CCASS Participant) contact your Intermediary and provide your Intermediary with instructions or make arrangements with your Intermediary in relation to the acceptance of your entitlements in sufficient time to ensure your instructions are given effect. Beneficial Owners who are CCASS Participants should contact CCASS and provide CCASS with instructions or make arrangements with CCASS as appropriate.

Beneficial Owners who are resident outside of the Permitted Territories are not permitted to take up their entitlements if it would be unlawful to make or accept an offer to subscribe for Offer Shares in such territory, or unless the Company otherwise determines, in its absolute discretion, that such Beneficial Owners may take up their entitlements on the basis that the Company is satisfied that the transaction in question is exempt from or not subject to the legislation or regulations giving rise to the restrictions in question.

Certificates of the Offer Shares for applicants holding Shares in his/her/its own name

Subject to the fulfilment of the conditions of the Open Offer, certificates for all fully-paid Offer Shares are expected to be posted to those entitled thereto by ordinary post to their registered addresses at their own risk on or around Friday, 7 August 2015. Each successful applicant will receive one share certificate for all the Offer Shares allotted and issued to him/her/it.

Certificates of the Offer Shares for applicants holding Shares through CCASS

For Beneficial Owners holding their Shares through CCASS and who decide to subscribe for the Offer Shares, HKSCC will directly credit the number of Offer Shares allocated to his/her/its CCASS account.

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LETTER FROM THE BOARD

WARNING OF THE RISKS OF DEALING IN THE SHARES

The Underwriting Agreement contains provisions granting Pine River and any other Underwriter a right to terminate the Underwriters’ obligations under the Underwriting Agreement upon the occurrence of certain events. Please refer to the section headed ‘‘Underwriting Arrangements’’ in this Letter from the Board for further details.

The Open Offer is conditional upon the Underwriting Agreement becoming unconditional and not being terminated in accordance with its terms. If this condition is not fulfilled, the Open Offer will not proceed, in which case a further announcement will be made by the Company at the relevant time.

The Shares have been trading on an ex-entitlement basis since Friday, 10 July 2015 and dealing in Shares will continue while the conditions to which the Underwriting Agreement subject remain unfulfilled. Any Shareholder or other person contemplating transferring, selling or purchasing Shares is advised to exercise caution when dealing in the Shares.

Any person who is in any doubt about his/her/its position or any action to be taken is recommended to consult his/her/its own professional adviser(s). Any Shareholder or other person dealing in the Shares up to the date on which all the conditions to which the Open Offer is subject are fulfilled will accordingly bear the risk that the Open Offer may not become unconditional or may not proceed.

REASONS FOR THE OPEN OFFER AND USE OF PROCEEDS

Reasons for the Open Offer

The principal activity of the Company is investment holding and the principal activities of the Group are the production and development of industrial commodities products. The Group is developing its K&S Project which, upon completion, would quadruple the existing annual production capacity of the Group. The Company requires funding to finance the completion of the final stage of construction at the K&S Project. With the on-going delay in the completion of the General Nice and Minmetals Cheerglory subscriptions (as further described in the paragraphs headed ‘‘General Nice and Minmetals Cheerglory Subscriptions’’ under the section headed ‘‘2. Share Capital’’ in Appendix III — General Information), the Company had been considering a number of fund raising options prior to the Open Offer, including a non pre-emptive placing of shares to independent third party investors. In this context, numerous potential investors were approached through a number of intermediaries, including existing Shareholders, Chinese stateowned enterprises, commodity trading houses and financial investors. Given the challenging market conditions for iron ore producers such as the Group, and the Group’s requirement for additional funding, the only viable fundraising structures involved an issuance of Shares at a substantial discount to the then market price of the Shares. Accordingly, the Company decided to pursue a fully underwritten pre-emptive share offer structure, which would provide existing Shareholders

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LETTER FROM THE BOARD

with the choice to further invest in the Company and protect their existing shareholding interest, whilst also providing the Company certainty in respect of the amount which it would be able to raise as a result of the underwriting.

The proposal for the Open Offer arose from discussions with certain of the financial investors which had been approached in relation to other possible fundraising structures, and who were prepared to act as underwriters on the terms of the Open Offer.

The Company considered alternative pre-emptive share issue structures such as a rights issue, but this was not considered to be preferable taking into account (a) the Underwriters’ preference for the structure of an open offer; and (b) the administrative effort and costs which would be required to make arrangements for sales of nil paid right under a rights issue, including additional professional parties’ costs. The cost of conducting a rights issue is estimated by the Company to be at least HK$380,000 (approximately US$50,000) more than the estimated costs of the Open Offer (being approximately HK$25 million (approximately US$3.2 million)), and the additional administrative effort involved in a rights issue include the preparation and publication of provisional allotment letters, arrangements with the Registrar to enable Shareholders and Beneficial Owners to split their provisional allotment or renounce their entitlement and administering the sale and transfers of nil paid rights.

The Company also considered that an open offer would provide each Shareholder an opportunity to subscribe for its assured entitlement to the offer Shares and to protect itself from dilution of its shareholding, in the same way as a rights issue would. Accordingly, the Company decided to proceed with an open offer structure.

In assessing whether the terms of the Open Offer are fair and reasonable, the Board took into consideration:

• (a) the funds which the Company needed to raise in order to finance the completion of the final stage of construction of the K&S Project, working capital required during commencement of commercial production at the K&S Project and for general working capital purposes, being approximately HK$383 million (approximately US$49.4 million);

• (b) the speed at which the Company would be able to raise the funds under an Open Offer structure and the certainty of raising such funds;

• (c) having concluded an extensive fundraising exercise, the terms of the Open Offer (including the Subscription Price) were the best reasonably available to the Company given the challenging market conditions for iron ore producers;

• (d) the attractiveness of the Subscription Price as compared to the market price of the Shares prior to the Announcement which should encourage and incentivise Shareholders to apply for the Offer Shares and reduce the dilution impact on a Shareholder’s shareholding interest in the Company; and

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LETTER FROM THE BOARD

• (e) the costs of the Open Offer as compared to increasing the Group’s borrowing costs and the overall security package which would need to be offered if the Company chose to seek bank financing to fund the completion of the final stage of construction of the K&S Project.

Taking into account the above, the Board considers that it is prudent to finance the final stage of construction of the K&S Project by way of the Open Offer and that the terms of the Open Offer are fair and reasonable and in the best interest of the Company and the Shareholders as a whole.

In the event that the conditions to the Open Offer are not fulfilled on or before the Long Stop Date and the Open Offer is terminated, the Company will be required to raise the amount needed to finance the final stage of construction of the K&S Project through alternative means, such as debt financing or through other forms of equity fundraising. This may lead to a delay in the completion of the construction of the K&S Project while the Company raises such funds and commencement of commercial production may not take place in the last quarter of 2015 as anticipated. K&S currently does not generate any revenues for the Group, but any delay in completing the construction of the K&S Project could materially adversely impact on the Group’s future operating results.

Use of proceeds

The expenses in relation to the Open Offer (including the underwriting commission, printing, registration, legal, accounting and documentation charges) are estimated to be approximately HK$25 million (approximately US$3.2 million).

The estimated net proceeds of the Open Offer will be approximately HK$383 million (approximately US$49.4 million) (assuming no new Shares were issued and no Shares were repurchased on or before the Record Date).

The net price per Offer Share (assuming no further issue of new Shares or buy-back of Shares on or before the Record Date) will be approximately HK$0.30.

Not less than 80% of the net proceeds, being approximately HK$306 million (approximately US$39.5 million) will be used to finance the completion of the final stage of construction of the K&S Project and the working capital needs of K&S during the initial period of commercial production. The remaining net proceeds of up to HK$77 million (approximately US$9.9 million) will be used for general working capital purposes of the Group, including possible payment of the contingent tax liabilities described in the paragraphs headed ‘‘Contingent Liabilities’’ in the section headed ‘‘2. Statement of Indebtedness’’ of Appendix I — Financial Information.

Taking into consideration the construction costs under the Company’s EPC contract with CNEEC and the project construction schedule, the Company estimates it will require at least HK$306 million (approximately US$39.5 million) to fully finance the final stage of construction at the K&S Project and satisfy the working capital requirements at K&S during the initial period of commercial production. The Company has sought to raise HK$383 million (approximately US$49.4

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LETTER FROM THE BOARD

million) net of expenses from the Open Offer to provide some buffer to this cost estimate and to account for the Company’s on-going general working capital requirements so as not to have to seek further financing prior to completion of construction at the K&S Project.

FUND RAISING OF THE COMPANY

The Company has not conducted any equity fund raising activities in the past 12 months immediately before the Latest Practicable Date.

Assuming the Open Offer completes successfully and the Company receives the net proceeds of HK$383 million (approximately US$49.4 million) as disclosed in the section headed ‘‘Reasons for the Open Offer and use of proceeds’’ in this Letter from the Board, the Company does not expect that it will need to conduct any further fundraising activity in the next 12 months from the Latest Practicable Date.

SHAREHOLDERS’ APPROVAL NOT REQUIRED

Since the Open Offer will not increase the issued share capital or the market capitalisation of the Company by more than 50% and the Open Offer is fully underwritten by the Underwriters each of whom is not a director, chief executive or substantial shareholder of the Company or an associate of any of them, pursuant to Rules 7.24(5) and 7.26A of the Listing Rules, the Open Offer is not subject to any Shareholders’ approval.

TAXATION

Qualifying Shareholders are recommended to consult their professional advisers if they are in any doubt as to the taxation implications of holding or disposal of, or dealing in the Offer Shares. It is emphasised that none of the Company, its Directors or any other parties involved in the Open Offer accept responsibility for any tax effects or liabilities of holders of the Offer Shares resulting from the purchase, holding or disposal of, or dealing in the Offer Shares.

ADDITIONAL INFORMATION

Your attention is drawn to the additional information set out in the appendices to this Prospectus.

Yours faithfully, For and on behalf of IRC LIMITED George Jay Hambro Executive Chairman

– 32 –

FINANCIAL INFORMATION

APPENDIX I

1. FINANCIAL INFORMATION INCORPORATED BY REFERENCE

The audited consolidated financial statements of the Group for each of the three years ended 31 December 2012, 31 December 2013 and 31 December 2014, including the notes thereto, have been disclosed in the annual reports of the Company for the year ended 31 December 2012 (pages 58 to 130) published on 12 March 2013, for the year ended 31 December 2013 (pages 60 to 125) published on 27 March 2014, and for the year ended 31 December 2014 (pages 74 to 138) published on 25 March 2015, respectively.

The said annual reports of the Company are available on the Company’s website at www.ircgroup.com.hk and the website of the Stock Exchange at www.hkexnews.hk. Please also refer to the hyperlinks to the annual reports as set out below:

2012 annual report:

http://www.hkexnews.hk/listedco/listconews/SEHK/2013/0312/LTN20130312019.pdf

2013 annual report:

http://www.hkexnews.hk/listedco/listconews/SEHK/2014/0409/LTN20140409003.pdf 2014 annual report:

http://www.hkexnews.hk/listedco/listconews/SEHK/2015/0325/LTN20150325025.pdf

2. STATEMENT OF INDEBTEDNESS

Save as set out in this section headed ‘‘2. Statement of Indebtedness’’, as at the close of business of 31 May 2015, being the latest practicable date for the purpose of this statement of indebtedness prior to the printing of this Prospectus, apart from intra-group liabilities, the Group did not have any mortgages, charges, debentures, loan capital, bank overdrafts, loans, liabilities under acceptance (other than under normal trade bills) or other similar indebtedness, hire purchase or finance lease obligations or any guarantees or other material contingent liabilities.

To the best knowledge of the Directors, having made all reasonable enquiries, there has been no material change in indebtedness or contingent liabilities of the Group since 31 May 2015.

Borrowings

As at 31 May 2015, the Group had gross borrowings of US$334.2 million, of which US$15.4 million was unguaranteed but secured by certain plant, property and equipment of the Group and a subsidiary’s shares held by the Group and US$318.8 million represented long term borrowing drawn from the secured US$340 million ICBC loan facility pursuant to the ICBC Facility Agreement which is guaranteed by Petropavlovsk and secured by the pledged deposits and shares of IRC which are beneficially owned by Petropavlovsk.

– I–1 –

FINANCIAL INFORMATION

APPENDIX I

Contingent liabilities

Save as set out below, as at the close of business on 31 May 2015, the Group did not have any material contingent liabilities.

The Company’s contract with its main contractor at the K&S Project, CNEEC, includes terms that include liquidated damages from the contractor for delays. The Company is engaged in discussions with ICBC and the contractor with regard to these liquidated damages. A fully funded bond is available to the Group on demand to cover all contractor delay penalties. CNEEC has proposed that they are entitled to payment for some extra works that they carried out in addition to the original design to further enhance the plant design and the Company is considering this proposal in conjunction with the contractor delay obligations. The Company expects that the amount claimed by CNEEC for the extra works will be in the region of 10% of the project cost and is analysing data provided for the calculation and requesting more information. The process is expected to be resolved in a constructive manner without affecting the timeframe for completion of the K&S Project and the Company is considering covering part of the extra costs subject to due diligence on the claims and satisfaction on the standard of works. The Group has no contractual liability under the engineering, procurement and construction (EPC) contract to pay for these additional works but has subsequently agreed to share a proportion of CNEEC’s properly incurred additional costs. Any proposals with regards to this matter is subject to on-going review by the Company.

A negative tax ruling from Russia tax authorities has been received by the Group requiring the payment by a Russian subsidiary of the Group of approximately US$3.8 million in respect of withholding tax which the Russia tax authorities claim was payable on the payment of interest on intra-group loans from its Russian subsidiaries to other subsidiaries outside of Russia. The Group’s position is that at the time of the payment of such interest, the relevant Group company receiving the payment was resident in the UK and the payment was therefore not subject to any withholding tax due to the double tax treaty between the UK and Russia. This is disputed by the Russia tax authorities. The Group has made an appeal against the negative ruling by the Russia tax authority and a decision is expected to be made by the Russia tax authority in July 2015. Should the decision confirm the Russia tax authorities’ current position, the Group will consider commencing proceedings to challenge the decision. As at the Latest Practicable Date, the Group has not received any decision by the Russia tax authority with regards to this matter.

Capital commitment

As at the close of business on 31 May 2015, and apart from the capital commitments that relate to the K&S Project (as disclosed in the paragraphs headed ‘‘Reasons for the Open Offer and use of proceeds’’ in the section headed ‘‘Letter from the Board’’ of this Prospectus), the Group has no other material capital commitments.

– I–2 –

FINANCIAL INFORMATION

APPENDIX I

3. WORKING CAPITAL

The Directors, after due and careful enquiry, are of the opinion that taking into account the cash flows to be generated from the operating activities of the Group (including from the commencement of production at the Group’s K&S Project during the last quarter of 2015), the internal resources available to the Group, the net proceeds of the Open Offer and the presently available credit facilities, the Group will have sufficient working capital for its present requirements for at least the next 12 months from the date of this Prospectus in the absence of unforeseen circumstances.

In assessing the cash flows to be generated from the Group’s operating activities, the Directors have performed sensitivity analyses taking into account what they consider to be reasonably possible adverse fluctuations in the Russian Rouble/US Dollar exchange rate and iron ore prices in the foreseeable future.

4. MATERIAL ADVERSE CHANGE

The Directors confirm that, as at the Latest Practicable Date, the Directors were not aware of any material adverse change in the financial or trading position of the Group since 31 December 2014, being the date to which the latest audited consolidated financial statements of the Group were made up.

5. EVENTS AFTER THE LATEST FINANCIAL STATEMENTS

After 31 December 2014, being the date on which the latest published audited consolidated accounts of the Group were made up and up to the Latest Practicable Date, the Company has not acquired or agreed to acquire or was proposing to acquire a business or an interest in the share capital of a company whose profits or assets make or will make a material contribution to the figures in the auditors’ report or next published accounts of the Company.

6. FINANCIAL AND TRADING PROSPECTS OF THE GROUP

The Group faces a number of challenges as a result of the current global macro-economic situation, particularly the depressed iron ore prices and the volatility of the Rouble. Nevertheless, the Company had a strong start to 2015 with production at Kuranakh in the first half of the year exceeding production in the first half of 2014 and the 2015 annualised target.

Kuranakh

Production and financials

At Kuranakh 566,349 tonnes of iron ore concentrate and 95,702 tonnes of ilmenite were produced during the first half of 2015. Such production represents 63% and 60% of the 900,000 tonnes iron ore and 160,000 tonnes of ilmenite targets respectively for 2015.

– I–3 –

FINANCIAL INFORMATION

APPENDIX I

Nevertheless, given the prevailing conditions in commodity prices, the future of the Kuranakh operation remains subject to review and stakeholders are once again advised that a temporary or permanent move towards a care and maintenance status at Kuranakh is a real possibility unless the market prices for iron ore or ilmenite improve or further cost savings can be achieved. In the event that operations at Kuranakh are suspended, a limited number of personnel could be relocated to K&S where production will soon commence. In the event of a shutdown, the processing and sale of inventories, with the sale of equipment, could generate sufficient funds to pay down the working capital facilities.

Marketing and sales

Sales for IRC iron ore concentrate from the Kuranakh Mine are secured under a longterm offtake agreement and prices are calculated on the INCOTERM ‘‘DAP’’ (Delivered at Place) basis. During the first half of 2015, IRC achieved an average selling price of US$54 per tonne of iron ore, a 49% decrease compared to an average selling price of US$105 per tonne in the corresponding first half of 2014 and a 30% decrease compared to an average selling price of US$77 per tonne in the second half of 2014. The price formula is calculated on averages for preceding periods and therefore lags the spot price.

Sales volumes for iron ore in the first half of 2015 were satisfactory. A total of 535,048 tonnes of iron ore were sold, a 3% increase compared to the same period last year.

During the first half of 2015, ilmenite sales totalled 110,568 tonnes. The average selling price of ilmenite sold by IRC during the first half of 2015 was US$120 per tonne.

Over the second quarter, cash costs remained lower than a year before, as the result of the successful ongoing cost optimisation programme, initiated in 2014. It is estimated that the cost saving measures together with the revised mine plan and Rouble exchange rate movements, can achieve an approximate 50% year on year cost savings during the first half of 2015.

K&S

At K&S cold commissioning is actively ongoing. The Crushing and Screening plant is up and ready for hot testing with almost all individual parts of equipment being tested. Hot commissioning is expected in Q3 2015 which will allow K&S to start producing and building fine crushed ore stockpiles to be ready for final processing, when the main processing plant at the K&S Project is commissioned later in this year. Overall work progress remains solid, with more than 1,000 contractor employees on site, reaffirming the previous target for K&S to reach full production in Q4 2015. When the final stage of construction at the K&S Project is completed and the mine is fully ramped up, IRC will move towards an annual capacity of 3.2 million tonnes and potentially expand to 6.3 million tonnes afterwards.

– I–4 –

FINANCIAL INFORMATION

APPENDIX I

In light of weak iron ore prices, and following the positive outcome of the cost-cutting programme at Kuranakh, IRC has performed a cost optimisation study for K&S. IRC’s study shows that costs at the K&S Project can be reduced by 28%. It is estimated that at full capacity the operation can produce and deliver premium 65.8% iron ore concentrate to the Chinese border for US$35.4 per tonne. This cost can be further lowered to US$28.0 per tonne if using the global benchmark of 62% material and when the Amur River bridge is completed.

Foreign Exchange

During the second quarter of 2015, the Rouble remained weak following the sharp depreciation against the US dollar in the second half of 2014. With operating costs in Roubles and revenues in US Dollars this has a positive impact on operating margins.

The US Dollar : Rouble exchange rate opened the quarter at approximately 57.6, and continued to rally near 50.0 to close at approximately 55.7 at the end of second quarter of 2015. There has been no material impact on IRC’s operations arising from international sanctions against Russia.

Risks to the Group’s operations

The Group is exposed to a variety of risks and uncertainties which could significantly affect its business and financial results. The Group’s view of the principal risks that could affect it for the remainder of the current financial year is substantially unchanged from those of the previous years. A summary of these key risks is set out below:

• . Operational and construction risks such as delay in supply or failure of equipment, services, contractors and adverse weather conditions.

• . Financial risks such as commodity prices, exchange rate fluctuations, access to funding and liquidity and capital programme controls. In particular:

• . the Russian Rouble/US Dollar exchange rate has a material impact on the Group’s financial performance given that a significant percentage of the Group’s costs are denominated in Russian Roubles, whilst a substantial portion of the Group’s sales are denominated in US Dollars. The Group has witnessed very substantial volatility in this exchange rate which may continue during the foreseeable future.

• . the substantial drop in the iron ore price may continue to have an impact on the Group as the Group’s operating cash flows (including its expected cash flows from its K&S Project) are materially dependent on the price at which it can sell its iron ore production. The Group’s operating cash flows have been materially and adversely affected by the substantial drop in the iron ore price over 2014 and 2015 to date. If the iron ore price weakens further in the long term, there is a risk that K&S may not be able to meet one of its financial

– I–5 –

FINANCIAL INFORMATION

APPENDIX I

covenants under the ICBC Facility Agreement without further capital injection from the Company into K&S. According to the ICBC Facility Agreement, having consulted its legal advisers, with the agreement of the lenders, the Company may make cash contributions into K&S in order to procure compliance with the relevant covenants under ICBC Facility Agreement.

• . Health, safety and environmental risks such as health and safety issues, legal and regulatory risks, licences and permits, restatement of reserves and resources, and non-compliance with applicable legislation.

• . Legal and regulatory risks such as country-specific risks.

• . Human resources risks such as the ability to attract key senior management and potential lack of skilled labour.

The above risks should not be regarded as a complete or comprehensive list of all potential risks that the Group may experience. In addition, there may be additional risks currently unknown to the Group and other risks, currently believed to be immaterial, which could turn out to be material and significantly affect the Group’s business and financial results.

– I–6 –

PRO FORMA FINANCIAL INFORMATION OF THE GROUP

APPENDIX II

For illustrative purposes, the financial information prepared in accordance with paragraph 4.29 of the Listing Rules is set out here to provide prospective investors with further information about how the financial information of the Group might be affected by the completion of the Open Offer as if the Open Offer had been completed on 31 December 2014. The pro forma financial information has been prepared for illustrative purposes only and because of its nature, it may not give a true picture of the Group’s financial position on the completion of the Open Offer.

(A) UNAUDITED PRO FORMA ADJUSTED CONSOLIDATED NET TANGIBLE ASSETS OF THE GROUP

The following is the unaudited pro forma statement of adjusted consolidated net tangible assets of the Group attributable to owners of the Company which has been prepared to illustrate the effect of the Open Offer on the net tangible assets of the Group as if the Open Offer had been completed on 31 December 2014. As it is prepared for illustrative purposes only, and because of its nature, it may not give a true picture of the financial position of the Group upon completion of the Open Offer.

The unaudited pro forma statement of adjusted consolidated net tangible assets of the Group attributable to the owners of the Company is prepared based on the unaudited adjusted net tangible assets of the Group attributable to owners of the Company as at 31 December 2014 as extracted from the annual report of the Group dated 25 March 2015 and is adjusted for the effect of the Open Offer.

Unaudited adjusted consolidated net tangible assets of the Group attributable to owners of the Company as at 31 December 2014 (Note 1) US$’000 310,152	Estimated net proceeds from the Open Offer (Note 2) US$’000 49,400	Unaudited pro forma adjusted consolidated net tangible assets of the Group attributable to owners of the Company as adjusted for the Open Offer US$’000 359,552	Unaudited adjusted consolidated net tangible assets of the Group attributable to owners of the Company as at 31 December 2014 per Share (Note 3) US$ 0.064	Unaudited pro forma consolidated net tangible assets of the Group attributable to owners of the Company as adjusted for the Open Offer per Share (Note 4) US$ 0.058

Notes:

1. The unaudited adjusted consolidated net tangible assets of the Group attributable to owners of the Company as at 31 December 2014 amounted to US$310,152,000. This amount is derived based on net assets attributable to owners of the Company of US$577,035,000 as extracted from the consolidated statement of financial position of the Group as at 31 December 2014 as set out in the 2014 annual report of the Group dated 25 March 2015 and after deducting exploration and evaluation assets of US$54,790,000 and mining licences and other intangible assets of US$212,093,000 included in mine development costs which were booked under property, plant and equipment.

2. The estimated net proceeds from the Open Offer are based on 1,295,976,080 Offer Shares at HK$0.315 (equivalent to approximately US$0.041) per Offer Share on the basis of 4 Offer Shares for every 15 Shares of the Company held as at the Latest Practicable Date, after deducting the estimated underwriting commission and other related expenses of approximately US$3.2 million to be incurred by the Company.

3. The number of Shares used for the calculation of this amount is 4,859,910,301 Shares in issue as at 31 December 2014.

4. The number of Shares used for the calculation of this amount is 6,155,886,381 Shares, representing 4,859,910,301 Shares in issue as at 31 December 2014 and 1,295,976,080 Offer Shares.

5. No adjustments have been made to reflect any trading results or other transactions of the Group entered into subsequent to 31 December 2014.

– II–1 –

PRO FORMA FINANCIAL INFORMATION OF THE GROUP

APPENDIX II

(B) ACCOUNTANTS’ REPORT ON THE UNAUDITED PRO FORMA STATEMENT OF ADJUSTED CONSOLIDATED NET TANGIBLE ASSETS OF THE GROUP

The following is the text of a report received from the auditor, Deloitte Touche Tohmatsu, Certified Public Accountants, Hong Kong, prepared for the purpose of incorporation in this Prospectus, in respect of the unaudited pro forma financial information of the Group.

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INDEPENDENT REPORTING ACCOUNTANTS’ ASSURANCE REPORT ON THE COMPILATION OF PRO FORMA FINANCIAL INFORMATION

TO THE DIRECTORS OF IRC LIMITED

We have completed our assurance engagement to report on the compilation of pro forma financial information of IRC Limited (the ‘‘Company’’) and its subsidiaries (hereinafter collectively referred to as the ‘‘Group’’) by the directors of the Company (the ‘‘Directors’’) for illustrative purposes only. The pro forma financial information consists of the unaudited pro forma statement of adjusted consolidated net tangible assets of the Group attributable to owners of the Company as at 31 December 2014 and related notes as set out in Part (A) of Appendix II to the prospectus issued by the Company dated 17 July 2015 (the ‘‘Prospectus’’). The applicable criteria on the basis of which the Directors have compiled the pro forma financial information are described in Part (A) of Appendix II to the Prospectus.

The pro forma financial information has been compiled by the Directors to illustrate the impact of the proposed open offer of 1,295,976,080 new shares of the Company (‘‘Offer Shares’’) at HK$0.315 each on the basis of 4 Offer Shares for every 15 existing shares of the Company (‘‘Open Offer’’) on the Group’s financial position as at 31 December 2014 as if the Open Offer had taken place at 31 December 2014. As part of this process, information about the Group’s consolidated net tangible assets has been extracted by the Directors from the Group’s consolidated financial statements for the year ended 31 December 2014, on which an annual audit report has been published on 25 March 2015.

Directors’ Responsibilities for the Pro Forma Financial Information

The Directors are responsible for compiling the pro forma financial information in accordance with paragraph 4.29 of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited (the ‘‘Listing Rules’’) and with reference to Accounting Guideline 7 ‘‘Preparation of Pro Forma Financial Information for Inclusion in Investment Circulars’’ (‘‘AG 7’’) issued by the Hong Kong Institute of Certified Public Accountants (‘‘HKICPA’’).

– II–2 –

PRO FORMA FINANCIAL INFORMATION OF THE GROUP

APPENDIX II

Reporting Accountants’ Responsibilities

Our responsibility is to express an opinion, as required by paragraph 4.29(7) of the Listing Rules, on the pro forma financial information and to report our opinion to you. We do not accept any responsibility for any reports previously given by us on any financial information used in the compilation of the pro forma financial information beyond that owed to those to whom those reports were addressed by us at the dates of their issue.

We conducted our engagement in accordance with Hong Kong Standard on Assurance Engagements (‘‘HKSAE’’) 3420 ‘‘Assurance Engagements to Report on the Compilation of Pro Forma Financial Information Included in a Prospectus’’ issued by the HKICPA. This standard requires that the reporting accountant comply with ethical requirements and plan and perform procedures to obtain reasonable assurance about whether the Directors have compiled the pro forma financial information in accordance with paragraph 4.29 of the Listing Rules and with reference to AG 7 issued by the HKICPA.

For purposes of this engagement, we are not responsible for updating or reissuing any reports or opinions on any historical financial information used in compiling the pro forma financial information, nor have we, in the course of this engagement, performed an audit or review of the financial information used in compiling the pro forma financial information.

The purpose of pro forma financial information included in an investment circular is solely to illustrate the impact of a significant event or transaction on unadjusted financial information of the Group as if the event had occurred or the transaction had been undertaken at an earlier date selected for purposes of the illustration. Accordingly, we do not provide any assurance that the actual outcome of the Open Offer at 31 December 2014 would have been as presented.

A reasonable assurance engagement to report on whether the pro forma financial information has been properly compiled on the basis of the applicable criteria involves performing procedures to assess whether the applicable criteria used by the Directors in the compilation of the pro forma financial information provide a reasonable basis for presenting the significant effects directly attributable to the event or transaction, and to obtain sufficient appropriate evidence about whether:

• . The related pro forma adjustments give appropriate effect to those criteria; and

• . The pro forma financial information reflects the proper application of those adjustments to the unadjusted financial information.

The procedures selected depend on the reporting accountants’ judgment, having regard to the reporting accountants’ understanding of the nature of the Group, the event or transaction in respect of which the pro forma financial information has been compiled, and other relevant engagement circumstances.

The engagement also involves evaluating the overall presentation of the pro forma financial information.

– II–3 –

PRO FORMA FINANCIAL INFORMATION OF THE GROUP

APPENDIX II

We believe that the evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Opinion

In our opinion:

• (a) the pro forma financial information has been properly compiled on the basis stated;

• (b) such basis is consistent with the accounting policies of the Group; and

• (c) the adjustments are appropriate for the purposes of the pro forma financial information as disclosed pursuant to paragraph 4.29(1) of the Listing Rules.

Deloitte Touche Tohmatsu

Certified Public Accountants

Hong Kong 17 July 2015

– II–4 –

GENERAL INFORMATION

APPENDIX III

1. RESPONSIBILITY STATEMENT

The Prospectus, for which the Directors collectively and individually accept full responsibility, include particulars given in compliance with the Listing Rules for the purpose of giving information with regard to the Company. The Directors, having made all reasonable enquiries, confirm that to the best of their knowledge and belief, the information contained in the Prospectus Documents is accurate and complete in all material respects and not misleading or deceptive, and there are no other matters the omission of which would make any statement herein misleading.

2. SHARE CAPITAL

The issued share capital of the Company as at the Latest Practicable Date were, and immediately following completion of the Open Offer is as follows:

As at the Latest Practicable Date:

Issued and fully paid share capital 4,859,910,301 Shares Upon completion of the Open Offer: Offer Shares to be issued 1,295,976,080 Shares Shares in issue upon completion of the Open Offer 6,155,886,381 Shares

Note: Under the Companies Ordinance, with effect from 3 March 2014, the concept of authorised share capital no longer exists and the Shares no longer have a par or nominal value.

The Offer Shares, when allotted and fully paid, will rank pari passu in all respects, including capital, dividends and voting rights with the Shares then in issue. Holders of fully-paid Offer Shares will be entitled to receive all future dividends and distributions which are declared, made or paid after the date of allotment of the Offer Shares.

The Company has not issued any Shares since the end of the last financial year (i.e. 31 December 2014). Save as disclosed in the section headed ‘‘General Nice and Minmetals Cheerglory Subscriptions’’ below, as at the Latest Practicable Date, the Company did not have any outstanding options, warrants or convertible securities which confer rights to subscribe for or affect the Shares. No capital of any member of the Group is under option, or agreed conditionally or unconditionally to be put under option as at the Latest Practicable Date.

General Nice and Minmetals Cheerglory Subscriptions

Pursuant to the General Nice Subscription Agreement, General Nice agreed to subscribe for up to 1,715,200,000 new Shares comprising 817,536,000 initial subscription Shares, 34,064,000 deferred subscription Shares and 863,600,000 further subscription Shares. Due to delays in the completion of General Nice’s subscription of Shares under the General Nice Subscription Agreement as described in the Company’s previous announcements in relation to this matter, as at the Latest Practicable Date, only 1,365,876,000 Shares have been allotted and issued to General Nice. As no deferred subscription Shares will be issued to General Nice, a further 315,260,000 Shares remain to be issued upon General Nice making payment to the Company of HK$296,344,400 (approximately US$38.2 million) and interest on such outstanding balance.

– III-1 –

GENERAL INFORMATION

APPENDIX III

Pursuant to the Minmetals Cheerglory Subscription Agreement, Minmetals Cheerglory agreed to subscribe for 247,300,000 new Shares. However, the subscription for these Shares by Minmetals Cheerglory cannot take place until General Nice has fully completed its subscriptions under the General Nice Subscription Agreement. The completion of the subscription by Minmetals Cheerglory under the Minmetals Cheerglory Subscription Agreement will be subject to further agreement between the parties.

The Company continues to be in discussions with General Nice, Mr Cai Sui Xin (Chairman of General Nice) and Minmetals Cheerglory about completion of General Nice’s subscription obligations.

3. DIRECTORS’ INTERESTS

As at the Latest Practicable Date, the interests or short positions of the Directors and chief executive of the Company in the Shares, underlying shares and debentures of the Company or its associated corporations (within the meaning of Part XV of the SFO) which were (i) required to be notified to the Company and the Stock Exchange pursuant to Divisions 7 and 8 of Part XV of the SFO (including interests and short positions which he/she was taken or deemed to have under such provisions of the SFO); (ii) required, pursuant to section 352 of the SFO, to be entered in the register referred to therein; or (iii) required, pursuant to the Model Code for Securities Transactions by Directors of Listed Issuers as set out in Appendix 10 to the Listing Rules (the ‘‘Model Code’’), to be notified to the Company and the Stock Exchange, were as follows:

Long Positions in shares of the Company

			Percentage
			of issued shares
			in the Company
		Number of	as at
		shares in the	the Latest
Name of Director	Nature of interest	Company	Practicable Date
George Jay Hambro	Interest of a controlled	352,000	0.01%
	corporation*
	Beneficial interest**	23,220,000	0.48%
	Contingent beneficial	4,874,539	0.10%
	interest***
Yury Makarov	Beneficial interest	20,555,500	0.42%
	Contingent beneficial	4,874,539	0.10%
	interest***
Raymond Kar Tung Woo	Beneficial interest	14,632,500	0.30%
	Contingent beneficial	4,874,539	0.10%
	interest***
Cai Sui Xin^	Interest of a controlled	1,365,876,000	28.10%
	corporation

– III-2 –

GENERAL INFORMATION

APPENDIX III

Notes:

• These Shares are beneficially owned by Mount F Consulting Limited, which is wholly owned by George Jay Hambro.

• ** The Shares were vested to an independent service company providing management services to the Company that is consequently classed as an affiliated company to George Jay Hambro.

• *** The vesting of these Shares is subject to the fulfillment of certain conditions and vesting period.

• ^ These Shares are beneficially owned by General Nice Development Limited (‘‘GND’’) and Mr. Cai Sui Xin is deemed to be interested in such Shares under the SFO by virtue of the fact that General Nice Group Holdings Limited, which is wholly owned by Mr. Cai Sui Xin, holds 50% equity interest in GND. Mr. Cai Sui Xin also directly holds 5% equity interest in GND.

			Percentage of
			issued shares in
			Petropavlovsk plc
		Number of shares in	as at the Latest
Name of Director	Nature of interest	Petropavlovsk plc	Practicable Date
George Jay Hambro	Beneficial interest	404,441	0.01%
Yury Makarov	Beneficial interest	75,278	0.002%

Long Positions in shares of an associated corporation

	Name of associated	Capacity and
Name of Director	corporation	nature of interest	Number of shares
George Jay Hambro	Petropavlovsk plc	Beneficial interest	404,441
Yury Makarov	Petropavlovsk plc	Beneficial interest	75,278

Mr. George Jay Hambro is the son of Mr. Peter Hambro, the Chairman of Petropavlovsk plc. Mr. Yury Makarov is the stepson of Dr Pavel Maslovskiy, the Chief Executive Officer of Petropavlovsk plc.

Save for those disclosed above, as at the Latest Practicable Date, none of the Directors or chief executive of the Company had any other interest or short positions in the Shares of the Company or any of its associated corporations (within the meaning of Part XV of the SFO) which were (i) required to be notified to the Company and the Stock Exchange pursuant to Divisions 7 and 8 of Part XV of the SFO (including interests and short positions which he/she was taken or deemed to have under such provisions of the SFO); (ii) required, pursuant to section 352 of the SFO, to be entered in the register referred to therein; or (iii) required, pursuant to the Model Code, to be notified to the Company and the Stock Exchange.

– III-3 –

GENERAL INFORMATION

APPENDIX III

As at the Latest Practicable Date, none of the Directors or any proposed director of the Company was a director or employee of a company which had an interest or short position in the Shares of the Company which would fall to be disclosed to the Company under the provisions of Division 2 and 3 of Part XV of the SFO.

4. INTERESTS OF SUBSTANTIAL SHAREHOLDERS

So far as is known to any Director or chief executive of the Company, as at the Latest Practicable Date, the Company’s shareholders (other than Directors or chief executives of the Company) who had interests or short positions in the shares or underlying shares of the Company which would fall to be disclosed to the Company under the provisions of Divisions 2 and 3 of Part XV of the SFO, or which were recorded in the register required to be kept by the Company as under Section 336 of the SFO were as follows:

			Approximate %
		of the Company’s
		total issued share
			capital as at
		Number of	the Latest
Name of shareholder	Capacity	Shares	Practicable Date
Petropavlovsk plc	Interest of a controlled	2,205,900,0001	45.39%1
	corporation
Cayiron Limited2	Beneficial owner	2,205,900,0001	45.39%1
Ming Chi Tsoi3	Interest of a controlled	1,962,500,0004	40.38%
	corporation
General Nice Group	Interest of a controlled	1,962,500,0004	40.38%
Holdings Limited5	corporation
General Nice Development	Beneficial owner	1,962,500,0004	40.38%
Limited
Cai Sui Xin5	Beneficial owner	1,962,500,000	40.38%
China Minmetals	Interest of a controlled	1,962,500,0004	40.38%
Corporation8	corporation
Central Huijin Investment	Person having a security	1,263,682,0006	26.00%
Ltd.	interest in shares
China Construction Bank	Person having a security	1,263,682,0006	26.00%
Corporation7	interest in shares
Pine River Lux Investments	Beneficial owner	959,987,83710	15.59%
S.a.r.l. 9

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Notes:

1. Of the 2,205,900,000 Shares, 521,376,470 Shares (10.73% of the issued share capital of the Company) were pledged on 6 February 2015.

2. Cayiron Limited is a wholly owned subsidiary of Petropavlovsk plc.

3. These Shares are beneficially owned by General Nice Development Limited (‘‘GND’’) and Mr. Ming Chi Tsoi is deemed to be interested in such Shares under the SFO by virtue of the fact that he holds 35% equity interest in GND.

4. These Shares are the aggregate number of Shares agreed to be subscribed by General Nice and Minmetals Cheerglory under the General Nice Subscription Agreement and Minmetals Cheerglory Subscription, respectively, as parties acting in concert under the Takeovers Code.

5. General Nice Group Holdings Limited is 100% controlled by Mr. Cai Sui Xin, and holds 50% equity interest in GND.

6. These Shares are Shares which have been pledged by GND to Prosper Talent Limited, which is indirectly wholly-owned by China Construction Bank Corporation.

7. China Construction Bank Corporation is controlled as to 57.26% by Central Huijin Investment Ltd.

8. Minmetals Cheerglory is indirectly wholly owned by China Minmetals Corporation.

9. Pine River Lux Investments S.a.r.l. is an indirect wholly owned subsidiary of Pine River Master Fund Ltd. (i) Pine River Capital Management L.P., and (ii) Pine River Capital Management (HK) Limited are deemed to be interested in these Shares as Pine River Master Fund Ltd. is accustomed to act in accordance with the directions of these two entities, and the two entities are in turn controlled by (a) Mr. Brian C. Taylor, (b) Pine River Capital Management LLC, (c) Pine River Holdings L.P., and (d) Pine River Performance L.P. by virtue of holding more than one-third of the interests in the two entities or by virtue of a general partner relationship with these two entities or a shareholder thereof.

10. These Shares represent the maximum number of the Offer Shares that Pine River as Underwriter is required to subscribe for or procure to subscribe pursuant to the Underwriting Agreement.

Save as disclosed above in this section, as at the Latest Practicable Date, the Company had not been notified by any persons (other than Directors or chief executives of the Company) who had interests or short positions in the shares or underlying shares of the Company which would fall to be disclosed to the Company under the provisions of Divisions 2 and 3 of Part XV of the SFO or who were, directly or indirectly, interested in 5% or more of the nominal value of any class of share capital carrying rights to vote in all circumstances at general meetings of any other members of the Group, or any options in respect of such share capital.

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APPENDIX III

5. DIRECTORS’ SERVICE CONTRACTS

As at the Latest Practicable Date, none of the Directors had any existing or proposed service contract with any member of the Group (excluding contracts expiring or determinable by the employer within one year without payment of compensation (other than statutory compensation)).

6. OTHER ARRANGEMENTS INVOLVING DIRECTORS

As at the Latest Practicable Date, none of the Directors had any direct or indirect interest in any assets which have since 31 December 2014, being the date to which the latest published audited consolidated financial statements of the Group were made up, been acquired or disposed of by, or leased to any member of the Group, or were proposed to be acquired or disposed of by or leased to any member of the Group.

As at the Latest Practicable Date, none of the Directors were materially interested, directly or indirectly, in any subsisting contract or arrangement entered into by any member of the Group which was significant in relation to the business of the Group.

7. COMPETING INTERESTS

Except as described below, none of the Directors or their respective associates was interested in, apart from the Group’s businesses, any business which competes or is likely to compete, either directly or indirectly, with the businesses of the Group.

Petropavlovsk is the ultimate holding company of the Company. Petropavlovsk and its subsidiaries (‘‘Petropavlovsk Group’’) are principally engaged in the exploration, development and production of precious metal deposits in Russia. The Directors do not consider Petropavlovsk to be a competitor of the Company because Petropavlovsk focuses on different commodities to the Company.

During the year and up to the Latest Practicable Date, George Jay Hambro and Yury Makarov are shareholders of Petropavlovsk and are therefore considered to have interests in Petropavlovsk.

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GENERAL INFORMATION

APPENDIX III

8. CORPORATE INFORMATION

Underwriters of the Open Offer

Pine River Lux Investments S.a.r.l. 42–44, avenue de la Gare L-1610 Luxembourg Grand Duchy of Luxembourg

Sothic Capital European Opportunities Master Fund Limited PO Box 309 George Town Grand Cayman KY1-1104 Cayman Islands British West Indies JABCAP Multi Strategy Master Fund Limited PO Box 309 Ugland House Grand Cayman KY1-1104 Cayman Islands Legal adviser to the Company Norton Rose Fulbright Hong Kong 38th Floor, Jardine House 1 Connaught Place Central, Hong Kong Legal adviser to the Underwriters Linklaters 10th Floor, Alexandra House Chater Road Hong Kong Reporting accountants and auditor Deloitte Touche Tohmatsu 35/F, One Pacific Place 88 Queensway Hong Kong Registrar Tricor Investor Services Limited Level 22, Hopewell Centre 183 Queen’s Road East, Hong Kong

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APPENDIX III

Principal banker	Royal Bank of Scotland
	7/F, Lincoln House
	Taikoo Place, 979 King’s Road
	Quarry Bay
	Hong Kong
Company secretary	Mr Johnny Yuen
Authorised representatives	Mr George Jay Hambro
	Mr Johnny Yuen

9.	PARTICULARS OF DIRECTORS AND SENIOR MANAGEMENT	PARTICULARS OF DIRECTORS AND SENIOR MANAGEMENT	PARTICULARS OF DIRECTORS AND SENIOR MANAGEMENT
	(a)	Names	Address
		Executive Directors:
		Mr George Jay Hambro	6H, 9 Queen’s Road Central, Hong Kong
		Mr Yury Makarov	6H, 9 Queen’s Road Central, Hong Kong
		Non-executive Directors:
		Mr. Simon Murray, CBE, Chevalier de	6H, 9 Queen’s Road Central, Hong Kong
		la Légion d’Honneur
		Mr Cai Sui Xin	6H, 9 Queen’s Road Central, Hong Kong
		Mr Liu Qingchun	6H, 9 Queen’s Road Central, Hong Kong
		Mr Raymond Kar Tung Woo	6H, 9 Queen’s Road Central, Hong Kong
		Independent non-executive Directors:
		Mr Daniel Rochfort Bradshaw	6H, 9 Queen’s Road Central, Hong Kong
		Mr Chuang-fei Li	6H, 9 Queen’s Road Central, Hong Kong
		Mr Jonathan Martin Smith	6H, 9 Queen’s Road Central, Hong Kong

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(b) Qualification and positions held

Executive Directors

George Jay Hambro

Mr George Jay Hambro, 40, is the Executive Chairman. In his early career, he was a metals and mining banker and adviser at NM Rothschild and HSBC. Subsequently he joined the Petropavlovsk Group where he was CEO of Aricom and later the CIO of Petropavlovsk, a role he relinquished in 2010 to head IRC. Mr Hambro is a Fellow of the Institute of Materials, Minerals and Mining and an Independent Non-Executive Director of Winsway Enterprise Holdings Ltd. and Cellmark Holdings AB. He holds a BA in Business Management from Newcastle University.

Yury Makarov

Mr Yury Makarov, 40, is the Chief Executive Officer. He began his career at NT Computers as an engineer, and later Commercial Director, with responsibility for sales, service and support. In 2002, he joined Aricom as COO and subsequently Petropavlovsk as the Group Head of Industrial Commodity Operations, before taking up his current role at IRC in 2010. Mr Makarov is a qualified systems engineer with an MA in Avionics from the Moscow State Aircraft Technology Institute.

Non-executive Directors

Raymond Kar Tung Woo

Mr Raymond Kar Tung Woo, 46, was the Chief Financial Officer until 25 March 2015. Mr. Woo began his career as an accountant at Arthur Andersen, then as an investment banker at ING, CITIC Securities and Credit Suisse. He holds a BCom from The University of New South Wales and is a member of the Australian Society of Certified Practising Accountants and a fellow of the Hong Kong Institute of Certified Public Accountants. He is an Independent Non-Executive Director of Yuanda China. Mr. Woo has been redesignated as a Non-Executive Director since 25 March 2015.

Simon Murray, CBE, Chevalier de la Légion d’Honneur

Mr Murray, 75, is a Non-Executive Director of IRC. Mr Murray’s career has included senior roles at Jardine Matheson, Hutchison Whampoa, Deutsche Bank and his current role as Non-executive Chairman of GEMS. Mr Murray was previously Chairman of Glencore International and Chairman of Gulf Keystone Petroleum. He is currently a Director of Cheung Kong, Orient Overseas, Wing Tai Properties, Greenheart, Spring Asset Management, China LNG Group and Compagnie Financière Richemont.

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APPENDIX III

Cai Sui Xin

Mr Cai Sui Xin, 54, is a Non-Executive Director. He is the Founder and Chairman of General Nice, a metallurgical coke producer and large private Chinese trader of steel raw commodities. Since 2013, General Nice is also a strategic shareholder of IRC with offtake arrangements for K&S and Garinskoye. Mr Cai is the Executive Chairman of Singapore quoted Abterra and Digiland International, in addition to being Executive Chairman of Hong Kong quoted Loudong General Nice Resources.

Liu Qingchun

Mr Liu Qingchun, 49, is a Non-Executive Director. He is the Managing Director of Minmetals Cheerglory, a subsidiary of China Minmetals Corporation where he is responsible for the Groups ferrous trading and logistics operations. He is a Director of Beijing Newglory and a Non-Executive Director of Hong Kong quoted Winsway. Mr Liu obtained holds an MBA from Saint Mary’s University in Canada and a BA in International Economics Law from Shanghai Institute of Foreign Trade.

Independent non-executive Directors

Daniel Rochfort Bradshaw

Mr Daniel Rochfort Bradshaw, 68, is the Senior Independent Non-Executive Director and Chairman of the Health, Safety and Environment Committee. A Hong Kong lawyer with a specialist shipping practice, he has worked for most of his career as a solicitor at Mayer Brown JSM. Mr Bradshaw holds an LLB and LLM in Law. He is a Non-Executive director of Euronav and an independent non-executive director of GasLog MLP and Pacific Basin Shipping, a Director of Greenship Offshore Management Pte Limited, a Director of the Kadoorie Farm and an Executive Council Member of the Hong Kong World Wide Fund for Nature Hong Kong.

Jonathan Martin Smith

Mr Jonathan Martin Smith, 56, is an Independent Non-Executive Director and Chairman of the Remuneration Committee. He was the founder of London based Smith’s Corporate Advisory, which he sold to UK stockbroker Westhouse Holdings in 2010, where he subsequently headed the mining practice. Prior to establishing his own firm, he worked at UBS, Credit Suisse and Williams de Broë. He is a graduate from the Royal Military Academy Sandhurst where he served as an officer until 1982.

Chuang-fei Li

Mr Chuang-fei Li, 68, is an Independent Non-Executive Director and Chairman of the Audit Committee. Mr Li worked for Bank of China in London as the Deputy General Manager and the Chief Lending Officer with wide responsibilities, including investment

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APPENDIX III

and corporate banking, treasury and capital markets, financial institutions coverage, structured finance, aircraft and shipping finance, syndications, retail banking and auditing. Mr Li is a past Fellow of the Asia Centre at Harvard University.

Senior Management

Danila Kotlyarov

Mr Danila Kotlyarov, 37, is the Chief Financial Officer. Mr Kotlyarov joined the Group in 2005 responsible over Russian and China operations, and was subsequently promoted to Deputy Chief Executive Officer. He holds a BA in Management and an MA in International Economics from the Moscow State Institute of International Relations. He is a fellow member of the Association of Chartered Certified Accountants and has professional diploma in civil and industrial construction.

Johnny Yuen

Mr Johnny Yuen, 42, is the Company Secretary, Corporate Controller, and Authorised Representative of the Company. Mr Yuen began his career in KPMG. Mr Yuen is a fellow member of the Hong Kong Institute of Certified Public Accountants and a member of the Association of Chartered Certified Accountants. He holds a MBA from the Manchester Business School of University of Manchester and a BA in Accountancy from the City University of Hong Kong.

10. LITIGATION

Save as disclosed in the paragraphs headed ‘‘Contingent Liabilities’’ in Appendix I — Financial Information, as at the Latest Practicable Date, neither the Company nor any of its subsidiaries was engaged in any litigation, arbitration or claim of material importance and no litigation, arbitration or claim of material importance was known to the Directors to be pending or threatened against the members of the Group.

11. MATERIAL CONTRACTS

Other than the Underwriting Agreement, there were no contracts (not being contracts entered into in the ordinary course of business) which were entered into by the Group within two years preceding the date of this Prospectus and which are or may be material.

12. EXPENSES

The expenses in connection with the Open Offer, including financial, legal and other professional advisory fees, underwriting commission, printing and translation expenses are estimated to be approximately HK$25 million (approximately US$3.2 million) and will be payable by the Company.

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APPENDIX III

13. EXPERT’S QUALIFICATION AND CONSENT

The following is the qualification of the expert who has given an opinions or advice which is contained in this Prospectus:

Name Qualification Deloitte Touche Tohmatsu Certified Public Accountants

Deloitte Touche Tohmatsu has given and has not withdrawn its written consent to the issue of this Prospectus with the inclusion of its report and references to its name in the form and context in which they are included.

Deloitte Touche Tohmatsu confirmed that as at the Latest Practicable Date, it did not have any beneficial shareholding in any member of the Group or the right (whether legally enforceable or not) to subscribe for or to nominate persons to subscribe for securities in any member of the Group, nor did it have any direct or indirect interests in any assets which have since 31 December 2014 (being the date to which the latest published audited consolidated financial statements of the Group were made up) been acquired or disposed of by or leased to any member of the Group, or were proposed to be acquired or disposed of by or leased to any member of the Group.

14. GENERAL

• (a) As at the Latest Practicable Date, there was no restriction affecting the remittance of profit or repatriation of capital of the Company into Hong Kong from outside of Hong Kong.

• (b) As at the Latest Practicable Date, other than the Irrevocable Undertaking, the Board had not received any information from any substantial shareholders (as defined under the Listing Rules) of their intention to accept or not accept the Offer Shares to which they are entitled under the Open Offer.

• (c) The English text of the Prospectus shall prevail over the Chinese text in the case of inconsistency.

15. LEGAL EFFECT

The Prospectus Documents and all acceptances of any offer or application contained in such documents are governed by and shall be construed in accordance with the laws of Hong Kong. Where an application is made in pursuance of any such documents, the relevant document(s) shall have the effect of rendering all persons concerned bound by the provisions, other than the penal provisions, of Sections 44A and 44B of the Companies (Winding Up and Miscellaneous Provisions) Ordinance, so far as applicable.

– III-12 –

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APPENDIX III

16. DOCUMENTS DELIVERED TO THE REGISTRAR OF COMPANIES

The following documents have been delivered to the Registrar of Companies in Hong Kong for registration as required by Section 38D of the Companies (Winding Up and Miscellaneous Provisions) Ordinance:

• (a) a copy of each of the Prospectus Documents; and

• (b) a copy of the written consent referred to in the paragraph headed ‘‘Expert’s Qualification and Consent’’ in this Appendix III.

17. DOCUMENTS AVAILABLE FOR INSPECTION

Copies of the following documents will be available for inspection during normal business hours from 9:30 a.m. to 5:30 p.m. on any Business Day at the offices of Norton Rose Fulbright Hong Kong at 38/F, Jardine House, 1 Connaught Place, Central, Hong Kong from the date of this Prospectus up to and including the Latest Time for Acceptance:

• (a) the memorandum and articles of association of the Company;

• (b) the material contracts referred to in the paragraph headed ‘‘Material Contracts’’ in this Appendix III to this Prospectus;

• (c) the report issued by Deloitte Touche Tohmatsu regarding the unaudited pro forma statement of adjusted consolidated net tangible assets of the Group attributable to the owners of the Company as set out in Appendix II to this Prospectus;

• (d) the written consent referred to in the paragraph headed ‘‘Expert’s Qualification and Consent’’ in this Appendix III to this Prospectus;

• (e) the annual reports of the Company for each of the two financial years ended 31 December 2013 and 2014; and

• (f) the Prospectus Documents.

– III-13 –