IRON BEAR RESOURCES LTD — Merger & Acquisition 2009

Aug 20, 2009

PRICE SIERAKOWSKI PHONE (618) 9221 6733 | FAX (618) 9221 6744 | ABN 83 662 050 668

TORTOGRAPH

POSTAL ADDRESS

ADDRESS

PO Box Z5433 St Georges Tce Perth WA 6831 Level 24, St Martin's Tower, 44 St Georges Tce Perth WA 6000

21 August 2009

Company Announcements Platform Australian Securities Exchange Limited Exchange Plaza 2 The Esplanade PERTH WA 6000

Our Ref: 090081 Solicitor: Simon Jenkins/ Frank Knezovic

Dear Sir/Madam

Corvette Resources Limited - Target's Statement Takeover Bid by Cape Lambert Iron Ore Limited

We act for Corvette Resources Limited ("Corvette") in relation to the takeover bid by Cape Lambert Limited ("Cape Lambert") for all of the ordinary fully paid shares in Corvette.

We attach, in accordance with section 633(1) (item 14) of the Corporations Act 2001, a copy of the Target's Statement prepared by Corvette in connection with the takeover bid.

The Target's Statement has been or will be lodged with the Australian Securities and Investments Commission and sent to Cape Lambert today.

Yours faithfully

Très Scèrekarski

PRICE SIERAKOWSKI

PRICE SIERAKOWSKI PTY LTD ACN 113 920 442 AN INCORPORATED LEGAL PRACTICE 한 가격 전화 전문 대학 전 기업 전문 기업 전 기업 전문 대학 중 대학 전문 고등 전문 기업 전문 기업 전문 대학 전문 대학 전문 기업 전문

TARGET'S STATEMENT

by

CORVETTE RESOURCES LIMITED ACN 103 006 542

in response to the offer by

CAPE LAMBERT IRON ORE LIMITED ACN 095 047 920

to acquire all of your ordinary shares in

CORVETTE RESOURCES LIMITED ACN 103 006 542

The Independent Directors of Corvette Resources Limited, having regard to the Independent Expert's conclusion that the Offer is NOT FAIR AND NOT REASONABLE and other factors, unanimously recommend that you REJECT the Offer by Cape Lambert Iron Ore Limited to acquire all your shares in Corvette Resources Limited.

PRICE SIERAKOWSKI 计实际方法的变体

Legal Adviser

This is an important document and requires your immediate attention. If you do not understand it or are in doubt as to how to act, you should consult your financial or other professional adviser immediately.

KEY DATES

Date of Cape Lambert's Offer	10 August 2009
Date of this Target's Statement	21 August 2009
Date for Cape Lambert to give Notice of Status of Conditions	4 September 2009
Scheduled close of Offer Period (unless extended or withdrawn)	11 September 2009

TABLE OF CONTENTS

Section 1	EXPLANATION OF WHY YOUR INDEPENDENT DIRECTORS RECOMMEND YOU SHOULD REJECT CAPE LAMBERT'S OFFER	8
Section 2	YOUR INDEPENDENT DIRECTORS' RESPONSE TO CERTAIN CAPE LAMBERT CLAIMS	14
Section 3	WHAT YOU SHOULD KNOW ABOUT CORVETTE	15
Section 4	YOUR CHOICES AS A CORVETTE SHAREHOLDER	21
Section 5	FREQUENTLY ASKED QUESTIONS ABOUT CAPE LAMBERT'S OFFER	23
Section 6	SOME OTHER ISSUES ARISING FROM CAPE LAMBERT'S OFFER	27
Section 7	ADDITIONAL INFORMATION	31
Section 8	APPROVAL OF TARGET'S STATEMENT	41
Section 9	DEFINITIONS AND INTERPRETATION	42

Annexure A - INDEPENDENT EXPERT'S REPORT

Important Information

This document is the Target's Statement dated 21 August 2009 given by Corvette Resources Limited ("Target" or "Corvette" or "Company") under Part 6.5 Division 3 of the Corporations Act in response to the Bidder's Statement by Cape Lambert Iron Ore Limited ("Bidder" or "Cape Lambert") dated 24 July 2009. A copy of this Target's Statement has been lodged with ASIC and ASX. Neither ASIC nor ASX nor any of their respective officers takes any responsibility for the contents of this Target's Statement.

The Directors recommend that you read this Target's Statement in full and seek independent advice if you have any queries in respect of the Cape Lambert Offer.

Corvette Shareholder Information

If you have any queries regarding the Cape Lambert Offer, please contact Corvette's Managing Director or Company Secretary on (08) 9421 1912 (from within Australia) or +61 8 9421 1912 (from outside Australia).

Defined Terms

A number of defined terms are used in this Target's Statement. These terms are defined in Section 9 of this Target's Statement.

No Account of Personal Circumstances

This Target's Statement does not take into account the individual investment objectives, financial situation and particular needs of each Corvette Shareholder and it does not contain personal advice. Corvette encourages you to seek independent financial and taxation advice before making a decision as to whether or not to accept the Cape Lambert Offer for your Corvette Shares.

Forward Looking Statements

This Target's Statement contains various forward looking statements. Statements other than statements of historical fact may be forward looking statements. Corvette believes that it has reasonable grounds for making all statements relating to future matters attributed to it in this Target's Statement. Corvette Shareholders should note that such statements are subject to inherent risks and uncertainties in that they may be affected by a variety of known and unknown risks, variables and other factors, many of which are beyond the control of Corvette. Actual results, values, performance or achievements may differ materially from results, values, performance or achievements expressed or implied in any forward looking statement. None of Corvette, its officers or any person named in this Target's Statement with their consent or any person involved in the preparation of this Target's Statement makes any representation or warranty (express or implied) as to the accuracy or likelihood of fulfilment of any forward looking statement, or any results, values, performance or achievements expressed or implied in any forward looking statement, except to the extent required by law. Shareholders should not place undue reliance on any such statement. The forward looking statements in this Target's Statement only reflect views held as at the date of this Target's Statement. Any forward looking statement in this Target's Statement is qualified by this cautionary statement.

Bidder's Statement

The information on Cape Lambert and the Cape Lambert Group contained in this Target's Statement has been prepared by Corvette using publicly available information.

The information in this Target's Statement concerning Cape Lambert and the assets and liabilities, financial position and performance, profits and losses and prospects of the Cape Lambert Group, has not been independently verified by Corvette. Accordingly, Corvette does not, subject to the Corporations Act, make any representation or warranty, express or implied, as to the accuracy or completeness of such information.

Risk Factors

Shareholders should note that there are a number of risks attached to their investment in Corvette. Please refer to Section 7.8 (Risk Factors) for further information on those risks.

Chairman's Letter

21 August 2009

Dear Corvette Shareholder,

You will have recently received a Bidder's Statement from Cape Lambert Iron Ore Limited (Cape Lambert) outlining its unsolicited and conditional offer for all your shares (Offer) in Corvette Resources Limited (Company).

The Cape Lambert Offer contains no cash. It is a scrip (i.e. share) only takeover offer based on a ratio of 0.417 Cape Lambert Share for each of your Corvette Shares, which means if you accept the Offer vou will become a shareholder in Cape Lambert.

In light of the fact Mr Antony Sage is a director of both Corvette and Cape Lambert, various steps have been taken to ensure the independence and integrity of the takeover response processes.

Accordingly, the Board of Corvette has established a sub-committee comprising Mr Patrick McManus, Managing Director of Corvette, and Non-Executive Chairman Mr John Moore (Independent Directors), to consider the Offer by Cape Lambert, formulate and prepare the Target's Statement and the Independent Directors recommendations, and make all Corvette Board decisions in relation to the Offer.

An Independent Expert's Report from Stantons International Pty Ltd (ABN 41 103 088 697) trading as Stantons International Securities (Independent Expert) accompanies this Target's Statement as The Independent Expert was commissioned by your Independent Directors in Annexure A. accordance with the Corporations Act and has concluded that Cape Lambert's Offer is NOT FAIR AND NOT REASONABLE to Corvette Shareholders.

Your Independent Directors unanimously recommend that you REJECT the Cape Lambert Offer and do nothing in response to the documents you have received from Cape Lambert. Each of the Independent Directors hold Corvette Shares and intend to REJECT Cape Lambert's Offer with respect to their own shareholdings in Corvette.

The reasons why the Independent Directors recommend you REJECT the Offer include the following:

• the independent Expert concludes Cape Lambert's Offer is NOT FAIR AND NOT $\bullet$ REASONABLE to Corvette Shareholder;
• the Offer has no premium;
• the Offer undervalues the quality of Corvette's assets; and
• the Offer fails to recognise Corvette's unrealised potential.

Please also see Sections 1 and 2 of this Target's Statement for further information and an explanation of the Independent Directors recommendations.

This Target's Statement sets out your Independent Directors' recommendation in response to the Offer. We encourage you to read carefully all of the information contained in this booklet, including the Independent Expert's Report, and seek independent financial and taxation advice.

The Independent Directors will keep you informed of any material developments in relation to the Offer.

If you have any queries in relation to the Offer, please consult your independent professional adviser or contact Corvette's Managing Director, Patrick McManus or Company Secretary, Richard Wolanski on (08) 9421 1912 (from within Australia) or +61 8 9421 1912 (from outside Australia) between 9.00am and 5.00pm (Perth time) Monday to Friday.

Yours sincerely

$\ddot{\phantom{1}}$

John Moore

Chairman - Corvette Resources Limited

REASONS WHY YOUR INDEPENDENT DIRECTORS UNANIMOUSLY RECOMMEND THAT YOU REJECT

CAPE LAMBERT'S OFFER

• Independent Expert concludes Cape Lambert's $\blacksquare$ Offer is NOT FAIR AND NOT REASONABLE to Corvette Shareholders
• The Offer has no premium $\overline{2}$
• The Offer undervalues the quality of Corvette's 3 assets

The Offer fails to recognize Corvette's 4 unrealised potential

Explanation of your Independent Directors reasons

Please see Section 1 of this Target's Statement for an explanation of the reasons why your Independent Directors unanimously recommend you to REJECT the Offer.

Other Corvette Director

Mr Antony Sage has not made a recommendation in relation to Cape Lambert's Offer because he is also a director of Cape Lambert.

Section 1 EXPLANATION OF WHY YOUR INDEPENDENT DIRECTORS RECOMMEND YOU SHOULD REJECT CAPE LAMBERT'S OFFER

$1.1$ INDEPENDENT EXPERT CONCLUDES CAPE LAMBERT'S OFFER IS NOT FAIR AND NOT REASONABLE TO CORVETTE SHAREHOLDERS

In accordance with their obligations under the Corporations Act the Independent Directors commissioned a report by the Independent Expert. The Independent Expert has concluded that Cape Lambert's Offer is not fair and not reasonable to Corvette Shareholders.

The key conclusions from the Independent Expert's Report are as follows:

The Independent Expert has estimated a range of values for a Corvette Share (based on the net asset value method). This range of values compared to the Independent Expert's estimated range of values for 0.417 Cape Lambert Shares (based on the quoted market price valuation method), is set out below:

	Estimated Low Value	Estimated Preferred Value	Estimated High Value
1 Corvette Share	7.90 cents	19.74 cents	28.44 cents
0.417 Cape Lambert Shares	13.34 cents	15.01 cents	17.30 cents
(Discount)/Premium	5.44 cents	$(4.73)$ cents	(11.14) cents
% (Discount)/Premium	40.77%	(31.51%)	(64.39%)

Note: the above estimated values for Corvette Shares do not include a control premium.

• The Independent Expert has concluded that:
• the Offer is significantly below the Independent Expert's estimated preferred $\circ$ value of a Corvette Share; and
• Cape Lambert is not paying a premium for control based on the Independent $\Omega$ Expert's estimated preferred and high values for a Corvette Share. Rather, Cape Lambert's Offer is at a significant discount to the Independent Expert's estimated preferred and high values for a Corvette Share.

The Independent Directors recommend that Corvette Shareholders should read the complete Independent Expert's Report set out in Annexure A to this Target's Statement.

$1.2$ THE OFFER HAS NO PREMIUM

The Independent Directors believe the circumstances in which Cape Lambert acquired its current 19.99% shareholding in Corvette is important in understanding the Offer and in assisting Shareholders in deciding whether to accept or reject the Offer.

The background to the Offer is summarised as follows:

• CopperCo Ltd (CopperCo) was the former beneficial owner of 40,000,000 Corvette $\bullet$ Shares, representing 34.47% of Corvette's issued share capital.
• On 26 November 2008, CopperCo appointed administrators and on 27 November 2008 Macquarie Bank Limited appointed receivers and managers to CopperCo pursuant to the secured debt owed by CopperCo.
• On 6 February 2009, Cape Lambert acquired all of the secured debt owed by CopperCo and duly appointed Messrs Gary Doran and David Lombe of Deloitte Touche Tohmatsu as the new receivers and managers to CopperCo.
• On 7 May 2009, Cape Lambert agreed with CopperCo (following a sale process conducted by the receivers and managers appointed by Cape Lambert) to acquire all of the shares in CopperCo's wholly owned subsidiary Mineral Securities Limited (MSL) and thus all of the assets of MSL held through various wholly owned subsidiaries of MSL.
• MSL's assets are the assets set out in Section 4.1 of the Bidder's Statement and include a 34.47% interest in Corvette Shares.
• Cape Lambert applied to ASIC for relief from the Corporations Act in order to enable it to acquire the 34.47% of Corvette Shares without having to make a takeover bid, as required by the Corporations Act.
• ASIC did not grant the requested relief to Cape Lambert and this decision was upheld by the Takeovers Panel.
• On 29 June 2009, Cape Lambert completed the acquisition of MSL on a restructured basis that included:
• Cape Lambert paying the sum of \$50.1 million to CopperCo; $\circ$
• Cape Lambert acquiring 19.99% in Corvette. The shareholding in Corvette that $\Omega$ exceeded 19.99% was transferred to CopperCo or an entity controlled by CopperCo (relevantly, 14.48% of Corvette Shares) (Excess Shares); and
• Cape Lambert will receive the benefit of any consideration obtained by the $\circ$ receivers and managers of CopperCo or any entity controlled by CopperCo in respect of the sale of the Excess Shares.
• The background to the Offer is further described in Section 4.1 of the Bidder's Statement.

In light of the summary of the background to the Offer set out above, the Independent Directors note the following relation to the Offer:

Cape Lambert originally intended to acquire all of the assets of MSL, including the $\bullet$ 34.47% shareholding in Corvette without needing to make a takeover bid for Corvette. However, as a result of ASIC and the Takeovers Panel refusal, Cape Lambert was required to restructure its acquisition on the basis set out in the summary above.

• Cape Lambert has completed the acquisition of MSL but does not own the Excess Shares.
• If CopperCo's receivers and managers (appointed by Cape Lambert) accept Cape Lambert's Offer:
• Cape Lambert will increase its shareholding in Corvette from 19.99% (currently) $\circ$ to 34.47%; and
• the receivers and managers of CopperCo or the entity controlled by CopperCo. $\circ$ will be required to transfer the Cape Lambert Shares it receives for the remaining 14.48% of Corvette Shares to Cape Lambert. However, under the Corporations Act a company cannot own its own shares. Consequently, the receivers and managers of CopperCo will need to sell those Cape Lambert Shares and pay the monies from such sales to Cape Lambert.
• The Independent Directors believe the receivers and managers of CopperCo are likely to accept Cape Lambert's Offer.
• The Offer provides Cape Lambert with the ability to either:
• acquire 100% of Corvette: Ó
• acquire control of Corvette (i.e. more than 50% of Corvette Shares); or $\circ$
• increase its shareholding in Corvette from its current 19.99% shareholding, $\circ$

without offering or paying a premium to Corvette Shareholders.

• Cape Lambert describes itself (in Section 5.1 of the Bidder's Statement) as having a strategy of investing in early stage or undervalued projects or companies. The original acquisition proposed by Cape Lambert is in keeping with this stated strategy and is an opportunity by Cape Lambert to acquire significant assets without paying a premium. The Offer is merely the method by which Cape Lambert is seeking achieve its original objective.
• Cape Lambert has stated (in Section 7.6 of the Bidder's Statement) that if it does not obtain control of Corvette, its intention is to hold the Corvette Shares it acquires as a portfolio investment. The Independent Directors believe that Cape Lambert's primary objective is to acquire Corvette (or as much as it can) without having to pay or offer a premium to Corvette Shareholders.

$1.3$ THE OFFER UNDERVALUES THE QUALITY OF CORVETTE'S ASSETS

The Independent Directors believe that Cape Lambert's Offer does not recognise Corvette's 100% interest in its potential world class Plumridge gold project which is strategically located in the Albany-Fraser Foreland, in close proximity to the 5 million oz Tropicana/Havana gold deposit. The 27 July 2009 announcement by the AngloGold Ashanti Australia Limited/ Independence Group Limited NL Joint Venture of a positive pre-feasibility study on the Tropicana/Havana gold deposit is a positive indication of the prospectivity of the region.

In particular, the Independent Directors highlight the following matters relating to the exploration potential of Corvette's assets:

Plumridge gold project

• The Albany-Fraser Foreland is a relatively under-explored region which is now generating encouraging exploration interest.
• Systematic exploration at Plumridge is producing high quality results.
• Geophysical and geochemical studies are supporting encouraging drilling assays. Ä
• With 2,300 km² of tenements and numerous gold intersections. Corvette has multiple targets available for drilling.
• Within the next six months further RC and diamond drilling are planned on identified targets.

Mineral sands assets

Corvette has a resource base of mineral sands which may have significant commercial $\bullet$ value, subject to prevailing mineral sands market conditions.

By accepting Cape Lambert's Offer, your exposure to the unrealised exploration potential of Corvette's assets will be significantly diluted.

If Cape Lambert acquired 100% of Corvette (by acquiring the outstanding 80.01% of Corvette Shares) under the Offer, Corvette Shareholders would constitute approximately 6.88% of Cape Lambert's current total issued share capital (assuming no exercise of existing Cape Lambert Options).

THE OFFER FAILS TO RECOGNISE CORVETTE'S UNREALISED POTENTIAL $1.4$

The Independent Directors believe that Corvette is well placed to develop the Plumridge Gold Project, unlock the unrealised value and potential of it's assets and create additional value for the benefit of all Shareholders.

Strong track record and experienced team

Corvette is currently supported by a core team of experienced, well credentialed professionals. focussed on delivering long term value to Shareholders demonstrated by progressing the Plumridge Gold Project through:

• geochemical sampling and drilling; $\bullet$
• RC drilling; and $\bullet$
• geophysical surveys. $\bullet$

This has progressed the Plumridge Project from 2,300 sq km with no gold exploration history to the current position of having significant gold intersections and identified multiple targets for high density drilling.

Progress to date

Key milestones achieved to date include:

• Identification of over 60 high quality gold soil anomalies on the Plumridge Gold Project - $\bullet$ May 2008.
• $\bullet$ Identification of early targets within the Plumridge Project at Corvette, Barrcuda, Road-Runner and Charger - November 2008.
• High grade gold intersections from RC drilling at the Corvette Prospect March 2008.
• +10g/t Au over 8 metres at the Stingray Zone within the Corvette Prospect June 2009.

Next steps

Planned activities on Plumridge, during the next six months include:

• Diamond drilling on several identified anomalous zones at Corvette.
• Analysis of geochemical results currently being generated by the CSIRO, to identify $\bullet$ further targets.
• Further geophysical surveys at selected zones, to identify further targets.
• Further substantial RC drilling on existing targets and those likely to be generated from the above activities.

The right team

Corvette has experienced core management and operating teams that are experienced in:

gold exploration and exploration in remote areas: $\bullet$

• adding value to projects and resources; and $\bullet$
• capital raising. $\bullet$

If there is any change to the Independent Directors' recommendation, the Independent Directors will inform you.

YOUR INDEPENDENT DIRECTORS' RESPONSE TO CERTAIN CAPE Section 2 LAMBERT CLAIMS

The Independent Directors do not consider that the reasons presented by Cape Lambert in its Bidder's Statement for acceptance of the Offer are persuasive. Some of Cape Lambert's claims and your Independent Directors' respo

Cape Lambert's Claim	Corvette's Response
Capacity to finance growth	Cape Lambert has stated that it would be in a position to apply some of its cash reserves, if it deems appropriate, to towards the exploration of Corvette's assets.
	Corvette's assets are relatively smaller than Cape Lambert's existing projects and Cape Lambert has not specified how it will prioritise its investment and development strategy to include the Corvette assets.
	Corvette is confident that (subject to continued positive exploration results) it will be able to raise funds to further develop and explore its assets without the significant dilution of Shareholders interests in the unrealised potential of Corvette's assets that would occur if the Offer was successful.
An increased market presence with increased investor interest	Cape Lambert has stated that its acquisition of Corvette would give Shareholders exposure to increased investor interest and presence in the equity market and the consequent increased liquidity in the trading of Cape Lambert Shares.
	Corvette Shareholders should note that if Corvette becomes a wholly owned subsidiary of Cape Lambert, all current Corvette Shareholders (excluding Cape Lambert) would constitute approximately only 6.88% of Cape Lambert's current issued share capital.
The Offer will provide Corvette Shareholders with access to an of portfolio increased and development, exploration other projects with geographical	In making this statement Cape Lambert has failed to explain to Corvette Shareholders that a consequence of becoming a Cape Lambert shareholder is that you will lose a significant portion of your exposure to the potential unrealised value of the Plumridge Gold Project.
diversity.	You will also be changing the nature of your investment from a focused exposure to gold exploration to Cape Lambert's diversified portfolio of commodities and projects.

Section 3 WHAT YOU SHOULD KNOW ABOUT CORVETTE

The following is a brief summary of Corvette's projects, a more detailed summary is contained in the Independent Valuation Report which forms part of the Expert's Report as Appendix B.

Overview of Corvette $3.1$

Corvette was incorporated on 29 November 2002 and listed on the ASX on 25 May 2007. The Company holds a 100% interest in mining tenements and tenement applications in Western Australia. Victoria, and Queensland. The company has granted exploration permits covering 7,395 km² and exploration licence applications covering a further 3,125 km².

The Company's main project is the Plumridge Gold Project, situated on the margin of the Albany Fraser Province and within the interpreted reworked transitional margin of the Yilgarn Block. This belt hosts the five million ounce Tropicana/Havana gold deposit, discovered by the Anglogold Ashanti/Independence JV partners. Excellent results are being achieved at what is a large (2,302 sq km), under-explored area.

The Company has also carried out exploration for heavy mineral sands with drilling programmes in the Murray and Otway Basins.

Location	Project	Granted Titles (km 2 )	Applications for Tenements (km 2 )	Total Area (km 2 )
Murray Basin	Wedderburn, Graybridge, Avonbank, Kalkee, Cannie West and Meridian.	1,200	288	1,488
Otway Basin	Otway	2.937		2,937
Albany Fraser Province	Plumridge	2,302		2.302
Cape York	Inkerman	956	2,837	3,793
Total Area km 2		7,395	3,125	10,520

Tenements

Plumridge Gold Project $3.2$

The Plumridge Gold Project is located on the western Eucla Basin margins where the basin sediments on-lap Proterozoic basement rocks of the Albany-Fraser Province.

Since June 2007, the Company has carried out a systematic auger gold geochemical sampling programme. The entire 2,302 sq km has been sampled on a 1,000m by 200m grid, with infill sampling on high value areas. Over 60 anomalous zones have been identified that warrant further sampling (See Figure 1).

Fig 1 Plumridge Project, Anomalous gold calcrete values.

Two areas were considered priority targets on the basis of:

• $(a)$ large areas of contiguous high gold in calcrete values, and
• $(b)$ peak values of +30 ppb Au (maximum result is 67 ppb Au).

These two broad areas are the Corvette Prospect and the Southern Anomaly.

Since April 2008, 43,699 metres of aircore drilling has been completed, 10,037 metres on the southern anomaly, the balance on the Corvette Prospect. Aircore drilling on the Southern Anomaly has identified three areas of basement gold mineralization (+0.1g/t Au), these are:

• Barracuda:
• Road Runner; and
• Charger.

Anomalous gold to 4g/t Au as supergene enrichments and as end-of-hole intersections at the Corvette Prospect directed the Company to focus its attention there.

Aircore drilling of the geochemical anomaly at the Corvette Prospect commenced in April 2008 and has encountered supergene gold mineralisation near the base of weathering in felsic to

REJECT CAPE LAMBERT OFFER

intermediate gneisses. Mineralisation is associated with hydrothermal alteration and sulphidation evident at the base of the weathered rocks. Anomalous gold has been outlined over 9 km of strike length, and in zones up to 300 metres wide. The aircore drilling was designed to delineate zones for deeper reverse circulation (RC) drilling to locate the sources of the supergene gold.

The results of the aircore drilling are shown in Figure 2. The clear correlation between basement gold mineralization and the large structures indicated by the aeromagnetic backdrop show that the right structures exist for a large gold deposit to form.

Fig 2 Results of Aircore Drilling

RC drilling on the Corvette Prospect has demonstrated high grade gold intersections in a number of locations within two arcuate sub-parallel geological structures that are approximately 300m apart and continuous for more than 9km (see Figure 3). Limited drilling (10,000 metres) has produced exceptional results including:

• 10 metres at 8.3 g/t Au from 119 metres in hole CVRC 58
• 2 metres at 2 g/t Au from 104 metres, 3 metres at 5 g/t Au from 110 metres and 2 metres at 3.5 g/t Au from 115 metres in hole CVRC 56
• 3 metres at 1.1 g/t Au from 94 metres, 2 metres at 1.1g/t Au from 114 metres and 1 metre at 15.2 g/t Au from 119 metres in hole CVRC 58
• 6 metres at 1.15 g/t Au from 75 metres in CVRC005
• 5 metres at 0.9 g/t Au from 14 metres including 1 metre at 3.20 g/t Au and 4 metres at 2.07 g/t Au from 38 metres in CVRC016
• 5 metres at 0.9 g/t Au from 14 metres in CVRC016, including 1 metre at 3.20 g/t Au

Fig 3 Selected RC gold intersections, showing extent of gold mineralization at Corvette Prospect

The Directors believe that these results indicate the potential of the Corvette Prospect to host several significant gold deposits, and also reinforce the prospectivity of the entire Plumridge Gold Project area.

Over the next twelve months, it is planned to focus on one or more areas of the Corvette Prospect to delineate a JORC resource, assuming the continuation of these encouraging results. This work would include :

• diamond drilling in this quarter, partly funded by an Exploration Incentive Scheme (EIS) grant of \$140,000 from the Western Australian Government;
• expanded geophysical and geochemical surveys, both independently and in a funded collaboration with the CSIRO:
• further aircore drilling; and
• further RC drilling.

$3.3$ Murray Basin

The Murray Basin projects are located in the west and north-west of Victoria and southwestern New South Wales. Within the Murray Basin projects, Indicated and Inferred Resources have been estimated at Wedderburn, Graybridge, and Avonbank-Kalkee. Corvette also holds mineralization identified on the Cannie West Project, and a conceptual heavy mineral target at the Meridian tenement.

A bulk sample of ore from the Wedderburn deposit was collected in 2006 and has been the subject of metallurgical test-work. In March 2008, a second heavy mineral concentrate (HMC) sample was produced from the bulk sample, for further processing to products and for additional marketing research.

Customer acceptance trials for the fine grained heavy mineral products produced from the Wedderburn deposit, and believed to be typical of the Victorian Murray Basin resources, were not sufficiently encouraging to progress to a bankable feasibility study. Work is continuing to identify customers and product niches where these materials will be accepted and, perhaps, be a preferred feedstock.

$3.4$ Mineral Resource

In June 2007, Corvette reported Mineral Resource estimates for the Wedderburn and Graybridge deposits, and an upgraded estimate for the Avonbank deposit, which includes extensions to the deposit on the Kalkee tenement.

Resource estimation was undertaken by Snowden Mining Industry Consultants Pty Ltd using the inverse distance cubed method for grade estimation. Resources are reported at 3% THM cut-off and are summarised in Table 1 below.

Corvette - Murray Basin Projects - Total Mineral Resource Estimate as at 30 June 2007
		Inferred			Indicated		Total Resource
Deposit	Tonnes Mt	THM %	Zircon % within THM	Tonnes Мt	THM ℅	Zircon % within THM	Tonnes Mt	THM %	Zircon % within THM
Wedderburn	141.1	4.3	13.5	32.0	4.8	18.6	173.2	4.4	14.4
Graybridge	47.6	3.4	$\overline{15.2}$				47.6	3.4	15.2
Avonbank/Kalkee	160.9	5.1	15.7	199.4	6.4	15.8	360.3	5.8	15.8
Total	349.6	4.6	14.7	231.4	6.2	16.2	581.1	5.2	15.3

Table 1: Murray Basin Snowden Report June 2007 Mineral Resource Estimate (at 3% THM cut-off)

Note: THM refers to total heavy minerals. Figures used are rounded.

Competent Person Attributes $3.5$

The information in this Section of the Target's Statement that relates to the Mineral Resources of the Avonbank, Wedderburn and Graybridge projects owned by Corvette is based on information compiled by Mrs Christine Standing, who is a member of The Australasian Institute of Mining and Metallurgy and has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which she is acting to qualify as a Competent Person as defined in the 2004 Edition of the 'Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves'. Mrs Standing, who is a full-time employee of Snowden Mining Industry Consultants, consents to the inclusion in this Target's Statement of the matters based on her information in the form and context in which it appears.

The information in this Section of the Target's Statement that relates to Exploration Results is based on information compiled by Mr Mark Teakle, who is a Member of the Australasian Institute of Mining and Metallurgy and a Member of the Australian Institute of Geoscientists. Mr Teakle is an employee of Corvette and has sufficient relevant experience to qualify as a Competent Person as defined in the 2004 Edition of the Australasian Code for Reporting of Exploration Results, Mineral resources and Ore Reserves. Mr Teakle consents to the inclusion in this Target's Statement of the matters based on his information in the form and context in which it appears.

YOUR CHOICES AS A CORVETTE SHAREHOLDER Section 4

You have three choices as a Corvette Shareholder in responding to Cape Lambert's Offer.

Your Independent Directors unanimously recommend that you REJECT Cape Lambert's Offer. To REJECT Cape Lambert's Offer, simply ignore all documents sent to you by Cape Lambert.

$4.1$ REJECT Cape Lambert's Offer

If you do not wish to accept Cape Lambert's Offer, simply ignore any documents sent to you by Cape Lambert.

You should be aware that:

• if you choose not to accept Cape Lambert's Offer and Cape Lambert acquires at least 90% of Corvette Shares, Cape Lambert may become entitled to compulsorily acquire the balance of the Corvette Shares, and it has said that it intends to exercise those rights (see Section 6.2 of this Target's Statement for further details);
• if you choose not to accept Cape Lambert's Offer and Cape Lambert acquires more than 50% but less than 90% of Corvette Shares, you will be exposed to the risks associated with being a minority shareholder in Corvette (see Section 6.1 of this Target's Statement for further details); and
• as a holder of Corvette Shares you will continue to be subject to the risks set out in Section 7.8 of this Target's Statement.

$4.2$ Sell your Corvette Shares on market

During Cape Lambert's Offer Period, you may sell your Corvette Shares on market through the ASX, provided you have not already accepted Cape Lambert's Offer for those Corvette Shares.

If you sell your Corvette Shares on market, you will receive cash for the sale of your Corvette Shares. If you sell your Corvette Shares on market, you:

• will lose the ability to accept Cape Lambert's Offer and receive Cape Lambert's Offer $\bullet$ consideration (and any possible increase in Cape Lambert's Offer consideration) in relation to those Corvette Shares:
• will lose the ability to accept any higher offer for Corvette Shares which may or may not eventuate from a third party;
• may incur a tax liability as a result of the sale; and
• may incur a brokerage charge.

$4.3$ Accept Cape Lambert's Offer

Cape Lambert has stated that its Offer remains open until 5.00 pm (WST) on 11 September 2009 (unless Cape Lambert's Offer is extended or withdrawn).

It is possible that Cape Lambert will choose to extend its Offer Period in accordance with the Corporations Act (see Section 10.2 of the Bidder's Statement). Details of the consideration that you will receive if you accept Cape Lambert's Offer is set out in its Bidder's Statement.

If you accept Cape Lambert's Offer you:

• will become a holder of Cape Lambert Shares in which case your investment will be subject to the risks associated with holding Cape Lambert Shares (as set out in Section 11 of Cape Lambert's Bidder's Statement);
• $\bullet$ may incur a tax liability as a result of your acceptance (see Section 6.5 of the Target's Statement);
• may be unable to accept any higher offer for your Corvette Shares that may eventuate from a third party; and $\bullet$
• will be unable to sell your Corvette Shares on market. $\bullet$

FREQUENTLY ASKED QUESTIONS ABOUT CAPE LAMBERT'S OFFER Section 5

In this Section answers are provided to some commonly asked questions about the Offer. This Section should be read together with the rest of this Target's Statement. This Section is not intended to comprehensively answer all questions that may arise in relation to the Offer nor address all issues that are relevant to Corvette Shareholders.

Question	Answer
Should I accept Cape Lambert's Offer?	No. Your Independent Directors unanimously recommend that you REJECT Cape Lambert's Offer.
	If there is any change to this recommendation your Independent Directors will inform you. Further details regarding your Independent Directors' recommendation are contained in Section 1 of this Target's Statement.
How do I REJECT the Offer?	To REJECT the Offer, you do not need to do anything. Do not respond to any calls or correspondence from Cape Lambert.
	You should note however that if Cape Lambert acquires 90% of the Corvette Shares it will be entitled to compulsorily acquire the Corvette Shares that it does not own.
How do I ACCEPT the Offer?	Follow the instructions in the Bidder's Statement.
What do the Independent Directors intend to do with their Corvette Shares?	Mr John Moore and Mr Patrick McManus intend to REJECT Cape Lambert's Offer in relation to those Corvette Shares they own or control. Mr Antony Sage does not currently own or control any Corvette Shares.
What is the Offer for my Corvette Shares?	Cape Lambert has made an Offer of 0.417 Cape Lambert Shares for every 1 Share that you hold in Corvette.
Who is Cape Lambert?	Cape Lambert is an Australian domiciled, listed exploration and development company (ASX code: CFE), with interests in a geographically diverse portfolio of mineral projects and investments in several exploration and mining companies. The primary mineral commodities comprise iron ore, copper and gold. (Please refer to Section 5.1 of the Bidder's Statement for further information on Cape Lambert).
What choices do I have?	As a Corvette Shareholder, you can:
(Please see Section 4 of this Target's Statement for further information)	REJECT Cape Lambert's Offer by doing nothing; or $\bullet$ SELL your Corvette Shares on market (unless you have previously accepted Cape Lambert's Offer and have not validly withdrawn your acceptance in the limited circumstances where this is permitted); or ACCEPT Cape Lambert's Offer - a course of action your
	Independent Directors do not recommend. Once you accept, you are locked in unless the limited withdrawal rights under the Offer apply. You will not receive the scrip (i.e. share) consideration until the Offer becomes unconditional.

Question	Answer
	If you do decide to accept the Offer, the Independent Directors believe it would be prudent to delay your acceptance until the conditions of the Offer are satisfied and just prior to the Offer Period closing. Note that you must comply with the conditions for acceptance set out in the Bidder's Statement.
	YOUR INDEPENDENT DIRECTORS RECOMMEND THAT YOU REJECT CAPE LAMBERT'S OFFER
What if I want to sell my Corvette Shares on market?	During the Offer Period, you may sell your Corvette Shares through the ASX for cash, provided you have not accepted Cape Lambert's Offer for those Shares.
	You should contact your broker for information on how to sell your Corvette Shares on ASX and your tax adviser to determine your tax implications of such a sale.
When do I have to decide?	If you wish to follow your Independent Directors' unanimous recommendation and REJECT Cape Lambert's Offer, you do not need to do anything.
	If you wish to accept Cape Lambert's Offer you need to do so before its scheduled closing date in accordance with the terms set out in the Bidder's Statement. Cape Lambert has stated that its Offer is scheduled to close at 5.00pm (WST) on 11 September 2009, unless it is extended or withdrawn.
What happens if I accept the Offer now?	If you accept Cape Lambert's Offer now, you will give up your rights to sell your Corvette Shares on market or otherwise deal with them (for example, by accepting a higher offer from another bidder if such an offer is made) unless the limited withdrawal rights apply at the applicable time and you validly withdraw your acceptance of Cape Lambert's Offer.
	Cape Lambert's Offer is conditional and if you accept the Offer while it is still conditional you will not receive the consideration under the Offer until 1 month after the Offer becomes unconditional (or 21 days after the end of the Offer Period, if earlier).
If I accept the Offer, can I withdraw my acceptance if I	You may only withdraw your acceptance if:
change my mind?	the conditions of the Offer are not fulfilled or waived by the ۰ times specified in the Bidder's Statement (see Section 10.8(e) of the Bidder's Statement); or
	Cape Lambert extends the Offer Period for more than 1 month and the Offer remains subject to 1 or more of the conditions at the time.
What happens if Cape Lambert increases its Offer?	If Cape Lambert increases its Offer, the Independent Directors will consider the increased offer and advise you of their position accordingly.
	If you accept Cape Lambert's Offer now and Cape Lambert subsequently raises its Offer Price you will receive the higher price if the Offer has become unconditional.

Question	Answer
What are the conditions of the Offer?	The Offer is subject to numerous conditions. These are summarised below:
	no agreement or arrangement exists under which other parties have rights to terminate or vary a material agreement or arrangement with Corvette, or acquire a material interest in or a substantial interest in Corvette Shares, as a result of Cape Lambert's acquisition;
	a Corvette Material Adverse Event occurs prior to the end of the Offer Period;
	$\bullet$ no prescribed occurrences listed in sections 652C(i)(a)-(h) and 652C(2)(a)-(e) of the Corporations Act occur in relation to Corvette before the date that is 3 Business Days after the end of the Offer Period;
	Corvette and its subsidiaries, during the Offer Period, do not ٠ declare, distribute or resolve to pay any dividends, bonus or other share of its profits or assets; and
	permission for admission to official quotation by ASX of the ٠ Cape Lambert Shares to be issued pursuant to the Offer.
	Full terms of the conditions are set out in Section 10.8(a) of the Bidder's Statement.
When will Cape Lambert advise as to the status of the conditions?	Section 10.8(e) of the Bidder's Statement indicates that Cape Lambert will give a Notice of Status of Conditions on 4 September 2009.
	Cape Lambert is required to set out in this Notice of Status of Conditions:
	whether the Offer is free of any or all of the conditions;
	whether, so far as the Bidder knows, any of the conditions ۰ have been fulfilled on the date the notice is given; and
	the Bidder's voting power in Corvette.
	If the Offer Period is extended by a period before the time by which the Notice of Status of Conditions is to be given, the date for giving the Notice of Status of Conditions will be taken to be postponed for the same period and the Bidder is required to give notice that states the new date for the giving of the Notice of Status of Conditions.
	If a condition is fulfilled (so that the Offer becomes free of that condition) before the date on which the Notice of Status of Conditions is required to be given, the Bidder must, as soon as practicable, give the ASX and Corvette a notice that states that the particular condition has been fulfilled.
What happens if the conditions are not satisfied or waived?	If the conditions are not satisfied or waived before the Offer closes, the Offer will lapse. You will then be free to deal with your Corvette Shares as you choose even if you have previously accepted the Offer.

How can Cape Lambert extend the Offer Period?	While the Offer is subject to conditions, Cape Lambert may extend the Offer Period at any time before giving the Notice of Status of Conditions. However, if the Offer is unconditional (that is, all the conditions are satisfied or waived), Cape Lambert may extend the Offer Period at any time before the end of the Offer Period.
	In addition, there will be an automatic extension of the Offer Period:
	• if within the last 7 days of the Offer Period: Cape Lambert improves the consideration offered under the Offer; or
	Cape Lambert's voting power in Corvette increases to more ۰ than $50\%$ .
	If either of these two events occurs, the Offer Period is automatically extended so that it ends 14 days after the relevant event occurs.
Can Cape Lambert withdraw the Offer?	Before you accept the Offer, Cape Lambert may withdraw the Offer with the written consent of ASIC and subject to the conditions (if any) specified in such consent. Cape Lambert may not withdraw the Offer if you have already accepted it. See Section 10.9 of the Bidder's Statement for further information.
What are the conclusions of the Independent Expert's Report?	The Independent Expert has concluded that Cape Lambert's Offer is NOT FAIR AND NOT REASONABLE to the non- associated Corvette Shareholders.
Can I be forced to sell my Corvette Shares?	You do not have to accept Cape Lambert's Offer.
	You cannot be forced to sell your Corvette Shares unless Cape Lambert acquires a relevant interest in at least 90% of all Corvette Shares by the end of the Offer Period, and Cape Lambert proceeds to compulsory acquisition of your Corvette Shares. (Refer to Section 7.4 of the Bidder's Statement)
Does the Offer include my Corvette Options?	No. However the Offer extends to Corvette Shares issued during the Offer Period as a result of the exercise of Corvette Options.
What are the risks associated with Corvette and its business?	These risks are detailed in Section 7.8 of this Target's Statement.
If I have further questions in relation to the Offer what can I do?	If you have any queries regarding Cape Lambert's Offer, please contact Corvette's Managing Director, Patrick McManus or Company Secretary, Richard Wolanski on (08) 9421 1912 (from within Australia) or +61 8 9421 1912 (from outside Australia).

$6.1$ Minority ownership consequences

In Section 7.5 of the Bidder's Statement, Cape Lambert describes its intentions in the event that if it gains control (i.e. more than 50% of the Corvette Shares) but less than 90% of the Corvette Shares. In this event, Corvette Shareholders who do not accept the Offer will become minority shareholders in Corvette.

This has a number of possible implications including the following:

• Cape Lambert will be able to cast the majority of votes at a general meeting of Corvette enabling them to control the board and senior management, determine Corvette's dividend policy and control the strategic direction of Corvette;
• Subject to the requirements of the Corporations Act and Corvette's constitution, Cape Lambert intends to appoint nominees of Cape Lambert to the Corvette Board;
• The Independent Directors believe that it is reasonably likely that the liquidity of Corvette Shares would be lower than at present. If the number of Corvette Shareholders is less than that required by the ASX Listing Rules to maintain an ASX listing, Cape Lambert may apply for Corvette's removal from the official list of the ASX. If this occurs, Corvette Shares will not be able to be bought or sold on the ASX;
• Cape Lambert may decide not to retain existing Corvette key technical and management staff or one or more may resign in light of the change of control at Corvette, potentially lessening the accumulated knowledge on Corvette's prospects; and
• If Cape Lambert acquires 75% or more of the Corvette Shares, it will be able to pass special resolutions of Corvette. This will enable Cape Lambert to amend Corvette's constitution.

$6.2$ Cape Lambert's stated intentions with respect to the Offer and Corvette

Sections 7.4 to 7.9 of Bidder's Statement details Cape Lambert's intentions in respect of the business, assets and employees of Corvette. The following is a summary of those intentions.

If Cape Lambert becomes entitled to 90% or more of Corvette Shares, it, subject $(a)$ to the satisfaction or waiver of the other Offer conditions, has the following intentions:

• Cape Lambert will proceed with the compulsory acquisition of any Corvette Shares not acquired under the Offer and all Corvette Options on issue which it is entitled to compulsorily acquire in accordance with the Corporations Act.
• At the conclusion of the compulsory acquisition process, Cape Lambert intends to arrange for Corvette to be de-listed from ASX.

• Shortly after closing the Offer, Cape Lambert will undertake a general review of Corvette's operations on both a strategic and financial level to determine their future prospects and whether any efficiencies or cost savings may be available to the Merged Entity.

• The status of Corvette's existing employees will be considered as part of Cape Lambert's review outlined above. Cape Lambert intends to combine certain common Cape Lambert and Corvette head office functions. Following its review, Cape Lambert will make decisions regarding senior management positions for the Merged Entity and consider whether these roles will be filled with Corvette or Cape Lambert employees. Where Cape Lambert decides that roles should be filled by existing Cape Lambert employees, Cape Lambert will consider whether there are opportunities elsewhere within the Cape Lambert Group for those Corvette employees who are no longer required in their existing roles.

• Cape Lambert will consider replacing the existing members of the Corvette Board with appointments by Cape Lambert. Replacement board members have not yet been identified by Cape Lambert.
• Subject to Cape Lambert's undertaking a review of Corvette's operations and based on publicly available information, Cape Lambert intends to:
• hold the key assets of Corvette and maintain its business in substantially the same manner as it is presently being conducted; and
• Not make any major changes to the business or assets of Corvette and not redeploy any of the fixed assets of Corvette.

$(b)$ If Cape Lambert is successful in acquiring more than 50.1% but less than 90% of the Corvette Shares, then Cape Lambert has the following intentions:

• If Cape Lambert becomes entitled at some later point to exercise general compulsory acquisition rights under the Corporations Act, it would exercise those rights.
• Cape Lambert intends to maintain Corvette's listing on ASX while it continues to meet ASX requirements but only if the benefits of that listing outweigh the corporate and compliance costs of doing so.
• Cape Lambert will consider appointing nominees to Corvette's Board. It is likely that Cape Lambert will seek to appoint its nominees to the Corvette Board commensurate with the level of its shareholding in Corvette.
• It is Cape Lambert's present intention to attempt to procure, through its representation on the Corvette Board and as a significant shareholder of Corvette, that the Corvette Board implements the objectives and goals outlined in Section 6.2(a) above to the extent possible and subject to the Corporations Act, the ASX Listing Rules and the legal obligations of the directors of Corvette to act in the best interests of Corvette Shareholders as a whole.

$(c)$ If Cape Lambert fails to acquire at least 50% of the Corvette Shares

Cape Lambert intends to hold those Corvette Shares as a portfolio investment and will continue to hold those Corvette Shares if, in Cape Lambert's view, that is in the best interests of Cape Lambert shareholders, otherwise Cape Lambert may dispose of those Corvette Shares in any manner it sees fit.

6.3 Compulsory acquisition

Cape Lambert has stated in Section 7.4 of the Bidder's Statement that if it becomes entitled to, it will proceed with compulsory acquisition of all outstanding Corvette Shares and Corvette Options in accordance with the Corporations Act.

REJECT CAPE LAMBERT OFFER

The two types of compulsory acquisition permissible under Chapter 6A of the Corporations Act are discussed below.

Follow-on compulsory acquisition $(a)$

Under Part 6A.1 of the Corporations Act, Cape Lambert will be able to compulsorily acquire any outstanding Corvette Shares for which it has not received acceptances on the same terms as Cape Lambert's Offer if during, or at the end of, the Offer Period, Cape Lambert (taken together with its Associates):

• has a Relevant Interest in at least 90% (by number) of the Corvette Shares; and
• has acquired at least 75% (by number) of the Corvette Shares for which it has made an Offer.

If these thresholds are met, Cape Lambert will have one month from the end of the Offer Period within which to give compulsory acquisition notices to Corvette Shareholders who have not accepted Cape Lambert's Offer. The consideration payable to Cape Lambert will be the same amount per share that is payable under Cape Lambert's Offer.

Corvette Shareholders may challenge any compulsory acquisition, but this would require the relevant Corvette Shareholders to establish to the satisfaction of a court that the terms of Cape Lambert's Offer do not represent fair value for the Corvette Shares. If Corvette Shares are compulsorily acquired, Corvette Shareholders are not likely to receive any payment until at least one month after the compulsory acquisition notices are sent.

If Cape Lambert does not become entitled to compulsorily acquire Corvette Shares in accordance with the above procedures, it may nevertheless become entitled to exercise general compulsory acquisition rights under Part 6A.2 of the Corporations Act.

General compulsory acquisition $(b)$

Under Part 6A.2 of the Corporations Act, Cape Lambert will also be entitled to compulsorily acquire any Corvette Shares if Cape Lambert holds full beneficial interests in at least 90% (by number) i.e. if Cape Lambert (together with its Associates) becomes a 90% holder of Corvette Shares.

If this threshold is met, Cape Lambert will have 6 months after it becomes a 90% holder within which to give compulsory acquisition notices to Corvette Shareholders. The compulsory acquisition notices sent to Corvette Shareholders must be accompanied by an independent expert's report and an objection form.

The independent expert's report must set out whether the terms of the compulsory acquisition give a "fair value" for the Corvette Shares and the independent expert's reason for forming that opinion.

If Corvette Shareholders with at least 10% of the Corvette Shares covered by the compulsory acquisition notice object to the acquisition before the end of the objection period (which must be at least one month), Cape Lambert may apply to the court for approval of the acquisition of the Corvette Shares covered by the notice.

Corvette Shareholders should be aware that if they REJECT Cape Lambert's Offer and their Corvette Shares are compulsorily acquired, those Corvette Shareholders will face a delay in receiving the consideration for their Corvette Shares compared with Corvette Shareholders who have accepted Cape Lambert's Offer.

$6.4$ Practical issues arising from Cape Lambert's Offer

• The market value of Cape Lambert Shares will change over time. The implied value of Cape Lambert's Offer will fluctuate with movements in the market value of Cape Lambert Shares. Corvette Shareholders are urged to obtain updated quotes on the price of Cape Lambert Shares. Such quotes can be obtained online at www.asx.com.au under the ASX code "CFE".
• Over time, the Cape Lambert Share price may fluctuate for a variety of reasons. including exchange rate movements or other factors which impact the operating or financial performance of Cape Lambert.
• It is possible that if Cape Lambert's Offer lapses, there may be a reduction in the market price for Corvette Shares.
• Shareholders should review the risks associated with becoming a Cape Lambert shareholder, as listed in Section 11 of the Bidder's Statement.

6.5 Tax consequences

The income tax implications for a Corvette Shareholder of accepting Cape Lambert's Offer will depend on a number of factors, including:

• whether the Corvette Shareholder holds their Corvette Shares on capital or revenue account for taxation purposes:
• the nature of the Corvette Shareholder (i.e. whether it is an individual, company, trust or complying superannuation fund); and
• the tax residency status of the Corvette Shareholder (i.e. Australian tax resident or not).

As these consequences differ widely according to each Corvette Shareholder's individual circumstances, you are encouraged to seek independent tax advice before making any decision in relation to the Offer. Cape Lambert has included a general outline of the tax implications of accepting the Offer in Section 9 of the Bidder's Statement but the Independent Directors recommend you discuss the Offer with your own tax adviser.

You should read carefully and consider the taxation consequences of accepting the Offer. The outline provided in the Bidder's Statement is of a general nature only and you should seek your own specific professional advice as to the taxation implications applicable to your circumstances.

6.6 Treatment of overseas Corvette Shareholders

Any Corvette Shareholder whose address (as recorded in the register of members of Corvette provided by Corvette to Cape Lambert) is in a place outside Australia or its external territories or New Zealand will not be issued with Cape Lambert Shares under the Offer.

Instead, the relevant Cape Lambert Shares (that would otherwise be transferred to such foreign shareholders) will be allotted to a nominee, appointed by Cape Lambert and approved by ASIC, who will sell the Cape Lambert Shares and will distribute to each of those foreign holders their proportion of the proceeds of sale net expenses.

Please see Section 10.7 of the Bidder's Statement for further details.

$7.1$ Details of Directors

The Directors as at the date of this Target's Statement are:

Name	Position
John Moore	Non-Executive Chairman
Patrick McManus	Managing Director
Antony Sage	Non-Executive Director

Mr Antony Sage is also a director of Cape Lambert. Given this common directorship. the Board of Corvette has established a sub-committee comprising Mr John Moore and Mr Patrick McManus to consider the Offer by Cape Lambert, formulate and prepare this Target's Statement and the Corvette Directors recommendations, and make all Corvette Board decisions in relation to the Offer.

In addition, the Board of Corvette has resolved that Mr Antony Sage will absent himself from any Corvette Board meeting where any discussions in relation to the Offer take place, and will continue to do so until completion of the Offer.

Accordingly, each of the Independent Directors desires to make, and considers they are justified in making, a recommendation in relation to the Offer.

$7.2$ Directors' intentions with respect to their own Corvette Shares

Mr John Moore and Mr Patrick McManus intend to REJECT Cape Lambert's Offer for all Corvette Shares in which they have a relevant interest.

Mr Antony Sage does not currently have a relevant interest in any Corvette Shares.

Interests of Directors 7.3

Interests in securities in Corvette $(a)$

The only marketable securities that Corvette has on issue are Corvette Shares and unlisted Corvette Options. As at the date of this Target's Statement, Corvette had 116,038,596 Corvette Shares and a total of 4,675,000 Corvette Options on issue. Each Corvette Option is exercisable into one Corvette Share.

Details of Corvette Shares and Corvette Options in which each Director has a Relevant Interest are as follows:

Director	Corvette Shares	Corvette Options
John Moore	$3,500,000^{(1)}$	Nil
Patrick McManus	$800,000^{(2)}$	$2,250,000^{(3)}$
Antony Sage	Nil	Nil

Notes:

• 3,000,000 Shares are held jointly and directly by Mr Moore and his wife. 500,000 $1.$ Shares are held by Ralsten Pty Ltd, a company controlled by Mr Moore.
• 600,000 Shares are held by Mr McManus' wife. 200,000 Shares are held by Bond $2.$ Street Custodians - Roberin Pty Ltd as trustee for the McManus Family Trust.
• 1,500,000 Class A Options are held by Mr McManus' wife. 375,000 Class D $\mathbf{R}$ Options and 375,000 Class E Options are held by Mr McManus directly.

$(b)$ Dealings in securities in Corvette

Other than as set out below, neither of the Independent Directors acquired or disposed of a Relevant Interest in any Corvette Shares or Corvette Options during the four month period ending on the date immediately before the date of this Target's Statement.

Mr Moore and/or his Associates acquired and disposed of the following Relevant Interest in Corvette Shares during the 4 month period immediately before the date of this Target's Statement:

Date	Activity
28/04/09	Acquired 18,546 Corvette Shares at \$0.07 each
30/04/09	Acquired 22,034 Corvette Shares at \$0.07 each
01/05/09	Acquired 100,000 Corvette Shares at \$0.067 each

$(c)$ Interests in securities of Cape Lambert

As at the date of this Target's Statement, and other than as set out below, none of the Independent Directors had a Relevant Interest in any securities in Cape Lambert.

Mr Antony Sage holds a Relevant Interest in 26,939,761 Cape Lambert Shares and does not hold any Options in Cape Lambert.

Mr John Moore holds (via Ralsten Pty Ltd, a company he controls) a Relevant Interest in 50,000 Cape Lambert Shares.

Dealings in securities of Cape Lambert $(d)$

Other than as set out below, neither Corvette nor either of the Independent Directors acquired or disposed of a Relevant Interest in any securities in Cape Lambert during the four month period ending on the date immediately before the date of this Target's Statement.

Mr Moore acquired and disposed of the following Relevant Interest in Cape Lambert Shares (via Ralsten Pty Ltd, a company he controls) during the 4 month period immediately before the date of this Target's Statement:

Date	Activity
20/05/09	Acquired 75,000 Cape Lambert Shares at \$0.305 each
04/06/09	Disposed of 75,000 Cape Lambert Shares at \$0.35 each
21/07/09	Acquired 50,000 Cape Lambert Shares at \$0.335 each
24/07/09	Disposed of 50,000 Cape Lambert Shares at \$0.35 each
03/08/09	Acquired 50,000 Cape Lambert Shares at \$0.36 each
06/08/09	Disposed of 50,000 Cape Lambert Shares at \$0.40 each
07/08/09	Acquired 50,000 Cape Lambert Shares at \$0.39 each

Agreements and benefits conditional on or connected with the Offer $(e)$

Neither of the Independent Directors is a party to any agreement or arrangement with any other person in connection with or conditional on the outcome of Cape Lambert's Offer and neither of the Independent Directors is entitled to receive any benefit from Cape Lambert which is conditional on or connected with the Offer (other than in their capacity as a Corvette Shareholder).

$(f)$ Contracts with Cape Lambert

Neither of the Independent Directors has any interest in any contract entered into by Cape Lambert.

Payments and benefits $(q)$

Other than a benefit permitted under section 200F of the Corporations Act, no benefit is proposed to be given to a Director:

• in connection with their retirement from office in Corvette or a related body $\bullet$ corporate of Corvette; or
• in connection with the transfer of the whole or any part of the undertaking or $\bullet$ property of Corvette.

$7.4$ Potential impact of Offer on Corvette's material contracts

Corvette has not identified any material contracts to which it is a party that contain change of control provisions that may be triggered as a result of the Offer or acceptances of the Offer.

$7.5$ Impact of Offer on Corvette Options

Cape Lambert stated in Section 7.9 of the Bidder's Statement that its Offer does not extend to the existing issued Corvette Options. However, the Offer does extend to any Corvette Shares that are issued between the Record Date and the end of the Offer Period as a result of the exercise of any Corvette Options. Additionally, Cape Lambert has stated in Sections 7.4 and 7.9 of the Bidder's Statement that if it is entitled to compulsorily acquire Corvette Shares it intends to also compulsorily acquire all issued Corvette Options in accordance with the Corporations Act.

$7.6$ Changes in the financial position of Corvette

Apart from the costs that are going to be incurred by Corvette in responding to the Offer, so far as is known to the Independent Directors of Corvette, there have been no material changes to Corvette's financial position since the Company's audit reviewed financial report for the half year ended 31 December 2008 which was lodged with the ASX on 11 March 2009.

$7.7$ Recent Announcements

Corvette is a disclosing entity under the Corporations Act. It is subject to regular reporting and disclosure obligations under the Corporations Act and ASX Listing Rules.

Listed below are the Company's announcements released since the lodgement of the Company's 2008 audited financial statements.

Date	Title of Announcement
03/10/2008	Notice of Annual General Meeting/Proxy Form
29/10/2008	RC Drilling Commences at Plumridge
29/10/2008	Quarterly Activities and Cashflow Report
11/11/2008	Drilling Extends Plumridge Gold Zone
12/11/2008	Results of Annual General Meeting
12/11/2008	AGM Presentation
12/11/2008	Change of Name to Corvette Resources
12/11/2008	New ASX Code Effective Date
13/11/2008	AGM Presentation Update
27/11/2008	Substantial Shareholder CopperCo Limited
28/11/2008	Resignation of Non Executive Director
28/11/2008	Final Director's Interest Notice
19/12/2008	Drilling Programme Completed
14/01/2009	Appendix 3B
16/01/2009	Change of Director's Interest Notice
16/01/2009	Change of Director's Interest Notice
16/01/2009	Change of Director's Interest Notice
19/01/2009	Response to ASX Query - Change in Director's Interest Notices
22/01/2009	Quarterly Activities Report
11/02/2009	Aircore Drilling Enhances Gold Zone
26/02/2009	Director Appointment/Resignation
27/02/2009	Final Director's Interest Notice

27/02/2009	Final Director's Interest Notice
27/02/2009	Initial Director's Interest Notice
27/02/2009	Initial Director's Interest Notice
05/03/2009	RC Drilling Intersects Gold along 8km Structure
11/03/2009	Half Yearly Accounts
19/03/2009	Corvette Intersects 15g/t gold
20/03/2009	Change of Director's Interest Notice
23/03/2009	Broker Presentation
23/03/2009	Broker Presentation (Amended)
14/04/2009	Change of Director's Interest Notice
22/04/2009	Quarterly Activities and Cashflow Reports
01/05/2009	Change of Director's Interest Notice
05/05/2009	Grant of Options to Non-Executive Directors
12/05/2009	Appendix 3B Release from Escrow
12/05/2009	Replacement Appendix 3Y Change in Directors Interests
13/05/2009	Presentation to Gold Investor Forum
19/05/2009	Corvette and CSIRO commence Research Programme
09/06/2009	TOV: Cape Lambert MinSec P/L - Panel Receives Application
17/06/2009	Cape Lambert MinSec Pty Ltd - Panel Affirms ASIC Decision
17/06/2009	Takeover Panel Decision
25/06/2009	High Grade Gold Intersection from RC Drilling at Corvette
29/06/2009	Awarded EIS Drilling Grant Funding
29/06/2009	CFE: Completion of CopperCo Asset Acquisition
29/06/2009	Becoming a substantial holder from CFE
01/07/2009	Change in substantial holding from CUO
02/07/2009	Letter re Change in substantial holding from CUO
06/07/2009	CFE Bid for Corvette
06/07/2009	Takeover Bid - Initial Take No Action Advice
13/07/2009	Further details of CFE bid for Corvette
14/07/2009	Corvette Share Price for Takeover Bid - Letter to S/holders

24/07/2009	CFE: Bidder's Statement - Corvette Resources
27/07/2009	Initial Response to Takeover Bid
28/07/2009	Significant Intersections of High Grade Gold at Stingray
30/07/2009	Quarterly Activities Report
10/08/2009	Bidders Statement Dispatch to Corvette Shareholders
11/08/2009	Response to Bidder's Statement

During the Offer Period you may obtain a copy free of charge of the announcements made by Corvette to ASX between the dates referred to above by calling Corvette's Company Secretary between 9.00am and 5.00pm (WST) on (08) 9421 1912 (from within Australia) or +61 8 9421 1912 (from outside Australia).

Copies of the above Corvette announcements may also be obtained from Corvette's website at www.corvetteresources.com.au.

Risk factors 7.8

Your Directors have recommended that you REJECT the Cape Lambert Offer. If you do not accept the Cape Lambert Offer and the Cape Lambert Offer is unsuccessful, you will continue to hold Corvette Shares and remain a Corvette Shareholder.

There a number of risks which may have a material and adverse impact on the future operating and financial performance of Corvette and the value of Corvette Shares. These may be risks that are widespread risks associated with any form of business or specific risks associated with Corvette's business and its involvement in the exploration and mining industry. While most risk factors are largely beyond the control of Corvette and its Directors, the Company will seek to mitigate the risks where possible, for example by obtaining appropriate insurances and maintaining its key relationships.

The following summary, which is not exhaustive, represents some of the major risk factor which affect Corvette. These risk factors ought not to be taken as exhaustive of the risks faced by Corvette or by Corvette Shareholders. These factors, and others not specifically referred to, may in the future materially affect the financial performance of Corvette and the value of Corvette Shares.

GENERAL AND INDUSTRY RISKS

Economic Conditions

Adverse changes in economic conditions such as interest rates, exchange rates, inflation, government policy, international economic conditions and employment rates, amongst others, are outside Corvette's control and have the potential to have an adverse impact on Corvette and its operations.

Stock Market Fluctuation

Investors should be aware that there are risks associated with any investment in a company listed on ASX. The value of Corvette Shares may rise above or fall below the current Corvette Share price depending on the financial and operating performance of Corvette and external factors over which the Company and the Directors have no control. These external factors include:

economic conditions in Australia and overseas which may have a negative impact on equity capital markets;

• changing investor sentiment in local and international stock markets, specifically relating to the mining sector or the gold and mineral sands sector;
• changes in domestic or international fiscal, monetary, regulatory and other government policies; and
• developments and general conditions in the markets in which Corvette proposes to operate and which may impact on the future value of shares in the exploration and mining sector.

Commodity Price Movements

The demand for and price of commodities is highly dependent on a variety of factors, including but not limited to, the international supply and demand of the commodities, the quality of the minerals produced, actions taken by governments, global economic and political
developments and exchange rates. Furthermore, international prices of gold and other commodities are denominated in United States dollars, whereas the income and the expenditure of the Company are and will be taken into account in Australian currency, exposing the Company to the fluctuations and volatility of the rate of exchange between the United States Dollar and the Australian Dollar as determined in the international market.

Regulatory Risks

While Corvette's business activities are highly regulated, it is possible that new specific laws will be introduced in Australia and/or overseas which may have a material adverse effect on Corvette's current and future business operations.

CORVETTE'S SPECIFIC RISKS

Exploration and Production

Exploration and production is a high-risk activity. There can be no guarantee of successful exploration or identification of ore resources or that planned exploration programs will lead to positive exploration results and the discovery of a commercial deposit or a commercial mining operation. Exploration is a speculative endeavour and can be hampered by the unpredictable nature of mineral deposits. Additionally, poor weather over a prolonged period may adversely affect mining and exploration activities and the timing of earning revenues, unforeseen major failures, breakdowns or repairs required to key items of mining plant and equipment or mine structure resulting in significant delays, notwithstanding regular repair, maintenance and upkeep programs and the ability to source and contract drilling rigs and other key items of mining plant and equipment resulting in delays and costs may adversely impact the Company's timing of exploration programs and the Company's budget.

Title to Tenements

Corvette's interests in their tenements in Australia are governed by legislation and are evidenced by the granting of tenements through the issue of a lease or license. Each lease or license is granted for a specific term and is subject to various conditions. Corvette may lose title or its interest in tenements if the relevant conditions are not met or if tenements are not renewed upon expiry of their current term.

Loss of Key Personnel

Corvette may also face risks from the loss of key personnel from time to time, and it may be difficult to secure replacements with appropriate experience and expertise.

Environmental Risks

Corvette's projects are subject to Australian laws and regulations regarding an environmental matter, which means there are potential liability risks. Whilst the Company proposes to operate fully in accordance with applicable laws and conduct its programs in a responsible

manner with regard to the environment, gold and mineral sand exploration and production can be environmentally sensitive and can give rise to substantial costs for environmental rehabilitation, damage control and losses. Further, there are a number of environmental conditions that may be attached to Corvette's mining tenements. Failure to meet such conditions could lead to forfeiture of these tenements.

Native Title and Land Access

The Company's activities in Australia are subject to the Native Title Act 1993 (Cth), and its interpretation. Uncertainty associated with Native Title issues may impact on the Company's future plans. The Company is not aware of any Native Title issue that cannot be resolved through the normal legal process should they arise. The Company is not aware of any other matters that may impact upon its timely access to the land that comprises its project areas. Despite Corvette's tenements being validly granted, there can be no guarantee that some of those tenements and subsequent mining titles will not be challenged or impaired, or that claims for compensation will not be made under the Native Title Act.

Aboriginal Sites of Significance

Commonwealth and State legislation in Australia allow for the protection of sites significant to Aboriginal custom and tradition. The Company proposes to carry out exploration work that would cause a disturbance to the land. The Company's tenements may contain some such sites of significance which would need to be avoided when carrying out field programs. It is possible that such areas where sacred sites exist may contain mineralization or an economic resource that would therefore remain unexploited.

Project Estimates and Project Costs

There is a risk that the cost of Corvette's current activities, future exploration, mining or construction costs or other future projected costs may exceed current expectations. In particular, estimates of future resources, production rates and operating costs are likely to change because they are based on preliminary feasibility studies.

Development Capital

Exploration and mining costs will reduce the cash reserves of the Company, which may not be replaced through the Company's mining operations, should these prove unsuccessful or perform below the expected acceptable base levels. The Company would then be dependent on seeking development capital elsewhere, through equity, debt or joint venture financing to support long term exploration and evaluation of its projects. There is a risk that Corvette may not be successful in obtaining the financing required as and when needed. Volatile markets for mineral commodities could make it difficult or impossible for Corvette to obtain debt or equity financing on favorable terms or at all. Failure to obtain timely additional financing may cause Corvette to postpone its development plans, forfeit rights in some or all of its properties or reduce or terminate some or all of its operations.

Dilution

Corvette may undertake additional offerings of securities in the future in order to finance its ongoing operations. There is a risk that the issue of additional securities may dilute the voting power of the existing Corvette Shareholders. There is also a risk that an increase in the number of Corvette Shares and the possibility of offers of new Corvette Shares may decrease the price of Corvette Shares already on issue.

Unsuccessful Offer Risk

If the Offer lapses without all Shares accepting into it, there is a risk that the market price of the Shares may drop with a reduced level of trading liquidity.

7.9 Consent to inclusion of statements

Stanton's International Pty Ltd (ABN 41 103 088 697) trading as Stantons International Securities has consented to the inclusion in this Target's Statement of its Independent Expert's Report in the form and context in which it appears and it has not before the lodgement of this Target's Statement with ASIC, withdrawn its consent.

Price Sierakowski has given, and has not before the lodgement of this Target's Statement with ASIC, withdrawn its consent to being named in this Target's Statement as legal advisers to Corvette.

Ravensgate has consented to the inclusion in this Target's Statement of its specialist report (contained in the Independent Expert's Report as Appendix B) in the form and context which it appears and Ravensgate has not before the lodgement of this Target's Statement with ASIC, withdrawn its consent.

Mrs Christine Standing has given her consent to the inclusion in this Target's Statement of all statements made by her or attributed or derived from those statements in the form and context in which they are included in Section 3 of this Target's Statement and has not before the lodgement of this Target's Statement with ASIC, withdrawn her consent.

Mr Mark Teakle has given his consent to the inclusion in this Target's Statement of all statements made by him or attributed or derived from those statements in the form and context in which they are included in Section 3 of this Target's Statement and has not before the lodgement of this Target's Statement with ASIC, withdrawn his consent.

This Target's Statement also includes statements made by, or statements based on statements made by Cape Lambert. Cape Lambert has not consented to those statements being included in this Target's Statement.

As permitted by ASIC Class Order 03/635, this Target's Statement may include or be accompanied by certain statements in relation to the Mineral Resources and Exploration Results within information set out in this Section of the Target's Statement fairly representing a statement by an official person or from a public official document or a published book, journal or comparable publication.

7.10 Publicly available information

This Target's Statement contains statements which are made in or based on statements made in, documents lodged by various parties (including Cape Lambert) with ASIC, or given to ASX, namely in the Bidder's Statement.

As required by ASIC Class Order CO 01/1543, Corvette will make available a copy of these documents (or of relevant extracts from these documents), free of charge, to Corvette Shareholders who request it during the Offer Period. To obtain a copy of these documents (or the relevant extracts), Corvette Shareholders may telephone Corvette on (08) 9421 1912 (from within Australia) or +61 8 9421 1912 (from outside Australia).

7.11 No other material information

This Target's Statement is required to include all the information that Corvette Shareholders and their professional advisers would reasonably require to make an informed assessment whether to accept Cape Lambert's Offer, but:

• only to the extent to which it is reasonable for investors and their professional advisers to expect to find this information in this Target's Statement; and
• only if the information is known to any Director.

The Directors are of the opinion that the information that Corvette Shareholders and their professional advisers would reasonably require to make an informed assessment whether to accept Cape Lambert's Offer is:

• the information contained in the Bidder's Statement; $\bullet$
• the information which has been previously disclosed by Corvette as a disclosing entity $\bullet$ in accordance with its continuous disclosure and reporting obligations to ASX and ASIC;
• the information contained in Cape Lambert's releases to ASX prior to the date of this $\bullet$ Target's Statement; and
• the information contained in this Target's Statement. $\bullet$

The Directors do not take any responsibility for the contents of the Bidder's Statement and are not to be taken as endorsing, in any way, any or all of the statements contained in it.

Section 8 APPROVAL OF TARGET'S STATEMENT

This Target's Statement has been approved by a resolution of the Corvette Board.

Signed for and on behalf of Corvette Resources Limited.

sureeds

---

Patrick McManus

Managing Director

Dated 21 August 2009

Section 9 DEFINITIONS AND INTERPRETATION

$9.1$ Definitions

In this Target's Statement, unless the context otherwise requires:

"A\$", "\$", or "AUD" means the currency of Australia;

"Au" means the chemical symbol for gold;

"Albany-Fraser Foreland" means the juncture between the Albany-Fraser Province and the Yilgarn Craton;

"Albany-Fraser Province" means a belt of rocks extending south and southeast of the Yilgarn Craton in southeast Western Australia:

"AngloGold Ashanti Australia Limited/Independence Group NL Joint Venture" means the joint venture between AngloGold Ashanti Australia Limited and Independence Group NL in respect of Tropicana/Havana;

"ASIC" means the Australian Securities and Investments Commission;

"Associates" has the meaning given in section 12 of the Corporations Act;

"ASX" means ASX Limited (ABN 98 008 624 691), and where the context requires, the Australian Securities Exchange;

"ASX Listing Rules" means the official listing rules of ASX as amended, varied, modified or waived from time to time;

"ASTC Settlement Rules" means the settlement rules of the Australian Settlement and Transfer Corporation Pty Ltd;

"Avonbank/Kalkee" means the tenement as shown in Figure 1 in section 1.4 of the Independent Valuation Report;

"Barracuda" means the area within the Plumridge Project as shown in Figure 2 in section 2.1.3 of the Independent Valuation Report;

"Bidder's Statement" means the bidder's statement issued by Cape Lambert dated 24 July 2009;

"Bidder" or "Cape Lambert" means Cape Lambert Iron Ore Limited (ACN 095 047 920);

"Business Day" means a day that is not a Saturday, Sunday or any other day which is a public holiday or a bank holiday in Western Australia;

"Cape Lambert Group" means Cape Lambert and each of its subsidiaries;

"Cape Lambert Option" means an option to acquire a Cape Lambert Share;

"Cape Lambert Share" means a fully paid ordinary share in Cape Lambert;

"Charger" means the area within the Plumridge Project as shown in Figure 2 in section 2.1.3 of the Independent Valuation Report:

"Class A Options" means an unlisted option to acquire a Corvette Share exercisable at \$0. 20 on or before 30 April 2010;

"Class B Options" means an unlisted option to acquire a Corvette Share exercisable at \$0.20 on or before 30 April 2010:

"Class C Options" means an unlisted option to acquire a Corvette Share exercisable at \$0.20 on or before 31 December 2010:

"Class D Options" means an unlisted option to acquire a Corvette Share exercisable at \$0.15 on or before 30 June 2012;

"Class E Options" means an unlisted option to acquire a Corvette Share exercisable at \$0.20 on or before 30 June 2012:

"CopperCo" means CopperCo Ltd (ACN 004 434 90) (Administrators Appointed) Receivers and Managers Appointed):

"Corporations Act" means the Corporations Act 2001 (Cth):

"Corvette" or "Company" or "Target" means Corvette Resources Limited (ACN 103 006 542);

"Corvette Board" or "Board" means the board of directors of Corvette:

"Corvette Material Adverse Event" means an event which will, or is reasonably likely to, have a material adverse effect on the assets and liabilities, financial position and performance, profits and losses, revenue or prospects of Corvette.

"Corvette Prospect" means the area within the Plumridge Project as shown in Figure 2 in section 2.1.3 of the Independent Valuation Report;

"Corvette Shares" or "Shares" means fully paid ordinary shares in the capital of Corvette;

"Corvette Shareholder" or "Shareholder" means a person registered in the register of members of Corvette as a holder of one or more Corvette Shares:

"CSIRO" means the Commonwealth Scientific and Industrial Research Organisation;

"Director" means a member of the Corvette Board;

"Expert's Report" or "Independent Expert's Report" means the report by the Independent Expert and attached as Annexure A to this Target's Statement;

"Graybridge" means the tenement as shown in Figure 1 in section 1.4 of the Independent Valuation Report;

"g/t" means grams per tonne;

"Independent Directors" means Mr John Moore and Mr Patrick McManus:

"Independent Expert" means Stantons International Pty Ltd trading as Stantons International Securities;

"Independent Valuation Report" means the independent valuation report by Corvidae Pty Ltd as Trustee for Ravensgate Unit Trust trading as Ravensgate;

"Indicated Resource" has the meaning ascribed to that term in the JORC Code;

"Inferred Resource" has the meaning ascribed to that term in the JORC Code;

"JORC" or "JORC Code" means the Australasian Code for Reporting Exploration Results, Mineral Resources and Ore Reserves 2004;

"km" means kilometres:

"Merged Entity" means Cape Lambert and its subsidiaries following the acquisition by Cape Lambert of all, or a majority of the Corvette Shares;

"Meridian" means the tenement as shown in Figure 1 in section 1.4 of the Independent Valuation Report:

"Mineral Resource" has the meaning ascribed to that term in the JORC Code;

"Notice of Status of Conditions" means a notice from Cape Lambert disclosing the status of the conditions of the Offer which is required to be given by subsection 630(3) of the Corporations Act;

"Offer Period" means the period referred to in Section 10.2 of the Bidder's Statement during which the Offer will remain open for acceptance;

"Offer Price" means the consideration offered under Cape Lambert Offer for each Corvette Share. As at the date of this Target's Statement, that consideration is 0.417 Cape Lambert Shares for each 1 Corvette Share:

"Cape Lambert Offer" or "Offer" means the Offer by Cape Lambert for the Corvette Shares on the terms contained in Section 10 of the Bidder's Statement:

"Plumridge Gold Project" or "Plumridge" means a 2,300sq km area, 250 km northeast of Kalgoorlie:

"Ravensgate" means Corvidae Pty Ltd as Trustee for Ravensgate Unit Trust trading as Ravensgate:

"Road-Runner" means the area within the Plumridge Project as shown in Figure 2 in section 2.1.3 of the Independent Valuation Report;

"Record Date" means the date set by the Bidder under section 633(2) of the Corporations Act, being 5pm (WST) on 7 August 2009;

"Relevant Interest" has the meaning given in sections 608 and 609 of the Corporations Act;

"Southern Anomalies" means the area within the Plumridge Project as shown in Figure 1 of Section 3.2 of this Target's Statement;

"Stingray Zone" means the area within the Plumridge Project as shown in Figure 3 of section 2.1.4 of the Independent Valuation Report;

"sq km" means square kilometres;

"supergene" means the base of weathered rock above the unoxidised basement rock:

"Target's Statement" means this document being the statement of Corvette under Part 6.5 Division 3 of the Corporations Act relating to the Offer:

"Tropicana/Havana" means the gold deposit as shown in Figure 2 in section 2.1.3of the Independent Valuation Report:

"Wedderburn" means the tenement as shown in Figure 1 in section 1.4 of the Independent Valuation Report;

"WST" means Australian Western Standard Time; and

"Yilgran Craton" means a large craton which constitutes the bulk of the Western Australian land mass.

$9.2$ Interpretation

In this Target's Statement, unless the context otherwise requires:

• the singular includes the plural and vice versa: $(a)$
• a reference to an individual or person includes a corporation, firm, partnership, joint $(b)$ venture, association, authority, trust, state or government and vice versa;
• $(c)$ a reference to any gender includes all genders:
• $(d)$ where a word or phrase is defined, its other grammatical forms have a corresponding meaning:
• a term not specifically defined in this Target's Statement has the meaning given to it (if $(e)$ any) in the Corporations Act or the ASTC Settlement Rules, as the case may be;
• $(f)$ unless otherwise specified, a reference to a section, clause, annexure or schedule is to a section, clause, annexure or schedule of or to this Target's Statement;
• a reference to any agreement or document is to that agreement or document (and, $(g)$ where applicable, any of its provisions) as amended, novated, supplemented or replaced from time to time;
• a reference to any legislation or legislative provision includes any statutory modification $(h)$ or re-enactment of, or legislative provision substituted for, and any subordinate legislation under, that legislation or legislative provision;
• $(i)$ the words "including", "such as", "particularly" and similar expressions do not imply limitation: and
• $(i)$ headings are for convenience of reference only and do not affect interpretation.

ANNEXURE A

INDEPENDENT EXPERT'S REPORT

REJECT CAPE LAMBERT OFFER

Stantons International Pty Ltd trading as

IEVEL 1 - 1 HAVELOCK STREET WEST PERTH WA 6005, AUSTRAIJA PH: 61 8 9481 3188 . FAX: 61 8 9321 1204 www.stantons.com.au

18 August 2009

The Directors Corvette Resources Limited Level 4, The Victoria Building 14-16 Victoria Avenue PERTH WA 6000

Dear Sirs

RE: CORVETTE RESOURCES LTD ABN 83 103 006 542 ("CORVETTE" OR "THE COMPANY") - INDEPENDENT EXPERT'S REPORT RELATING TO THE TAKEOVER OFFER TO THE SHAREHOLDERS OF THE COMPANY BY CAPE LAMBERT IRON ORE LIMITED

$\mathbf{1}$ . Introduction

• $1.1$ We have been requested by the Independent Directors of Corvette to prepare an Independent Expert's Report in accordance with Section 640 of the Corporations Act 2001 to determine whether the proposed Takeover Offer by Cape Lambert Iron Ore Limited ("Cape Lambert") is fair and reasonable to the Ordinary Shareholders of Corvette. All Shareholders of Corvette should read the Bidders Statement of Cape Lambert and the Target Statement prepared by Corvette to fully understand the implications of the Takeover Offer. We will also comment on the fairness and reasonableness of the share value stated by Cape Lambert in its Bidders Statement in relation to the Corvette Shares as at the date of a pre-bid agreement dated 7 May 2009 entered into between Cape Lambert and CopperCo Limited (Receivers and Managers Appointed) (Administrators Appointed) ("CopperCo"), a significant Shareholder in Corvette, as noted in further detail elsewhere in this report.
• $1.2$ In May 2009, Cape Lambert through its 100% owned subsidiary Cape Lambert Minsec Pty Ltd ("CLM") agreed to acquire all of the shares in Mineral Securities Limited ("Minsec"), through the acquisition of various assets from CopperCo. Minsec, through one of its then wholly owned subsidiaries Mineral Securities Holdings Pty Ltd ("MSH") held 34.47% of the share capital in Corvette. Of the 34.47% ownership of Corvette, it was agreed that 19.99% of the share capital in Corvette be retained by Minsec (and subsequently transferred to the control of Cape Lambert via the sale of Minsec to CLM), whilst the remaining 14.48% of share capital in Corvette had been sold directly to and held in trust by CopperCo ("Excess Shares"). The Excess Shares were transferred by Cape Lambert to CopperCo so as not to breach Section 606 of the Corporations Act. CopperCo will remit any consideration received from the sale of the Excess Shares to Cape Lambert or CLM. It is proposed that Cape Lambert acquires the remaining 80.1% of Corvette, which is to be implemented by way of a formal takeover offer for all shares in Corvette by Cape Lambert (that is the remaining 80.01% of ordinary voting shares not controlled by Cape Lambert). CLM is a wholly owned subsidiary of Cape Lambert, which

is a publicly listed company on the Australian Securities Exchange ("ASX"). Corvette is also listed on the ASX. Cape Lambert and the Receivers and Managers of CopperCo entered into a binding formal Agreement on 29 June 2009 in relation to the acquisition of the CopperCo assets. We are not reporting on the fairness and reasonableness or otherwise of Cape Lambert's acquisition of assets from CopperCo, which includes the acquisition of Minsec.

Under the takeover bid:

(a) Corvette Ordinary Shareholders will be entitled to receive 0.417 of a Cape Lambert share for every 1 Corvette Ordinary Share held on the Record Date. Thus for every 2.4 Corvette shares a shareholder owns, the shareholder would receive 1 Cape Lambert share.

The full details of the Corvette Takeover Offer are included in the Bidders Statement dated 24 July 2009.

The Directors of Corvette are required to issue a Target Statement in response to the Bidders Statement, which will include their recommendation as to whether all Corvette shareholders should accept the Takeover Offer.

This report is to be included in a Target Statement dated on or around 24 August 2009 to be sent to all Corvette shareholders and has been prepared exclusively for the purpose of assisting Corvette shareholders in their consideration of the Takeover Offer by Cape Lambert. The report should not be used for any other purpose.

An Expert's Report is required pursuant to Section 640 of the Corporations Act 2001 as Corvette (Target Company) director Mr Antony Sage is also a Director of Cape Lambert (Bidder Company).

• Cape Lambert is a public company listed on the Official List of the ASX. Cape Lambert $1.3$ is an Australian domiciled mineral investment company, whose most significant assets include a 100% interest in the Lady Annie copper project (near Mount Isa, Queensland), a 35% interest and manager in the Marampa iron ore project (Sierra Leone), an approximate 29% interest in the Mayoko Iron ore project (Republic of Congo), a 100% interest in the Sappes Gold Project (in north eastern Greece) and the Australis phosphate project (located on the Northern Territory and Queensland border near Mount Isa). It also holds, directly as at 20 July 2009 the following percentages of ordinary capital in the following companies:
• 12.3% of International Goldfields Limited (listed on the ASX)
• 4.8% of Universal Resources Limited (listed on the ASX)
• 1.8% of Stirling Minerals Limited (listed on the ASX)
• 19.6% of Global Iron Limited (listed on the ASX)

Indirectly, Cape Lambert also holds interests in a further 6 companies listed on the ASX, as well as further indirect interests in another 5 companies listed on the Alternative Investment Market of the London Stock Exchange ("AIM") and one company listed on the Toronto Stock Exchange ("TSX").

Cape Lambert's strategy is to invest in early stage resources projects and companies that are considered undervalued or distressed, in order to position any such assets for either development and/or sale.

Further information regarding Cape Lambert can be found in the Bidders Statement (dated 24 July 2009) at "Section 5 - Profile of Cape Lambert". Inter alia, the following information can be located:

• an overview of Cape Lambert's activities and projects;
• ownership and share structure; and
• a profile of the directors of Cape Lambert.
• Corvette is a public listed company listed on the Official List of the ASX. Corvette has $1.4$ established a portfolio of 100% owned Exploration Licences and Applications within Australia covering approximately 10,500 km2 in Western Australia, Victoria and Oueensland.

Corvette's flagship project is the Plumridge gold project which is located in the western Eucla Basin of Western Australia. A geochemical sampling programme identified priority areas, called Corvette and the Southern Anomaly which indicated large areas of contiguous high gold in calcrete values and peak values of +30 ppb Au. It is intended that deeper drill testing, and possibly diamond drilling as well as further geochemical programmes will be undertaken in 2009.

Corvette has secured advanced project areas in Victoria (including within the Murray and Otway Basins) containing resources that exhibit potentially favourable mining and processing options, and good infrastructure. In addition, exploration projects have been secured in provinces with potential for mineral sands and gold deposits.

Further information regarding Corvette can be found in the Target Statement at "Section 3 - "What you should know about Corvette".

• In assessing the Takeover offer for Corvette, we have had regard to relevant Australian $1.5$ Securities and Investments Commission ("ASIC") Regulatory Guide 111: Content of Expert Reports ("RG 111"). RG 111 suggests that an opinion as to whether transactions are fair and reasonable should focus on the purpose and outcome of the transaction, that is, the substance of the transaction rather than the legal mechanism to affect the Offer.
• An offer (in this case the Takeover Offer made by Cape Lambert through the Takeover 1.6 Bid for Corvette) is fair if the value of the offer price or consideration (shares in Cape Lambert and cash equivalent for foreign shareholders) is equal to or more than the value of the securities the subject of the Takeover Offer (for the Ordinary Shares in Corvette). An offer is reasonable if it is fair. In this situation, we are reporting on the proposals to the ordinary shareholders of Corvette as to whether the proposed Takeover Offer is fair and reasonable to the ordinary shareholders not associated with Cape Lambert.

• The Independent Directors of Corvette have requested Stantons International Pty Ltd $1.7$ trading as Stantons International Securities ("SIS") to prepare an Independent Expert's Report providing an opinion on whether the Corvette Takeover Offer by Cape Lambert is fair and reasonable to Corvette shareholders. In addition SIS will report as to whether the value per security consideration noted in the Cape Lambert Bidder's Statement of 24 July 2009 in relation to the pre-bid proposal is fair and reasonable. Our IER will be included in the Target Statement to be issued to the shareholders of Corvette.

• Apart from this introduction, this report considers the following: $1.8$

• Summary of opinion
• Implications of the proposed Takeover by Cape Lambert $\blacksquare$
• Profile of Corvette $\blacksquare$
• Profile of Cape Lambert $\blacksquare$
• Methodology
• Valuation of Corvette shares $\blacksquare$
• Valuation of Cape Lambert shares
• Value and Fairness of Consideration Compared to Value of Assets Acquired
• Reasonableness of the Takeover Offer to Corvette Shareholders
• Conclusion as to Fairness and Reasonableness of the Takeover Offer
• Sources of information
• Appendices A

Summary Opinion $2.$

In determining the fairness and reasonableness of the Takeover Bid relating to the $2.1$ Corvette shareholders (we are not reporting on the fairness and reasonableness or otherwise of the acquisition of the CopperCo assets by Cape Lambert's subsidiary) we have had regard to the guidelines set out by ASIC in its Regulatory Guide 111.

RG 111 states that an opinion as to whether an offer is fair and/or reasonable shall entail a comparison between the offer price and the value that may be attributed to the securities under offer (fairness) and an examination to determine whether there is justification for the offer price on objective grounds after reference to that value (reasonableness). An offer is "fair" if the value of the consideration offered is equal to or greater than the value of the securities that are subject to the offer and an offer is "reasonable" if it is "fair", or where it is not fair, it may still be "reasonable" after considering other significant factors which support the acceptance of the offer in the absence of a higher bid.

Our report relating to the Cape Lambert Takeover Offer regarding Corvette shareholders is concerned with the fairness and reasonableness of the Takeover Offer. The advantages, disadvantages and other factors determined to arrive at our opinions are outlined in detail under Section 10 of this report.

• $2.2$ After taking into account all of the factors noted in this report and in the absence of more superior offers, we are of the opinion that on an adjusted net asset value and quoted share market basis in valuing the Corvette Shares and the Cape Lambert Shares respectively, the proposed Takeover Offer by Cape Lambert to the Corvette shareholders is not fair and not reasonable to the shareholders of Corvette.
• $2₃$ The opinion expressed above must be read in conjunction with the more detailed analysis and comments made in this report, including the Independent Valuation Report of Ravensgate Pty Ltd dated 10 August 2009 (Appendix B to this report).
• $3₁$ Implications of the proposal of the proposed Takeover Offer by Cape Lambert
• As at 17 August 2009, there are 116,038,596 fully paid quoted ordinary shares on issue in $3.1$ Corvette.

Shareholder	No. of Fully Paid Shares held	$\frac{0}{0}$
Mineral Securities Limited
(controlled by Cape Lambert)	23,207,719	19.99
CopperCo Limited	16,792,281	14,47
ANZ Nominees Limited	4,200,556	3.62
Hon John Moore and Ms Jacqueline
Moore	3,000,000	2.59
Donamac Investments Pty Ltd	2,371,111	2.04
Simon Moore	2,370,000	2.04
Ajava Holdings Pty Ltd	2,200,000	1.90
Mark Teakle	2,105,263	1.81
Metprotech Pacific Pty Ltd	2,000,000	1.72
Henley Park Estate Pty Ltd	1,688,000	1.45
Total top 10 shareholdings	60,046,930	51.65

$3.2$ As at 30 July 2009, the top 10 fully paid shareholders of Corvette are believed to be:

The top 20 shareholders as at 30 July 2009 owned 61.82% of the quoted ordinary shares on issue. Details on the Directors interests in Corvette are outlined in the Target Statement under the heading of "7.3 (a) Interests of Directors".

• $3.3$ The total number of ordinary shares in Cape Lambert as at 17 August 2009 is 523,797,213. The total number of ordinary voting shares on issue in Cape Lambert (after incorporating the acquisition of Corvette – that is the remaining $80.1\%$ of ordinary voting shares) would be 562,476,745 before the placement of any shares that are planned to be undertaken in the second half of 2009 and assuming that the Takeover Offer is accepted by Corvette by 80.01% of the shareholders. Please note that Cape Lambert, through CLM already holds 19.99% of Corvette and this holding will be excluded from the post acquisition share structure of Corvette. The effect of the Cape Lambert Takeover Offer for Corvette is that Corvette becomes a wholly owned subsidiary of the Cape Lambert Group. The ordinary shareholders of Corvette would own approximately 6.88% of the expanded ordinary voting issued capital of Cape Lambert.
• $3.4$ In addition to the above pro-forma shareholding in Cape Lambert, Cape Lambert has on issue the following share options ("Cape Lambert Options") as at 17 August 2009:
• 28,000,000 (pre incorporation of acquisition of Corvette), exercise price of 30.9 cents each, expiry date of 31 October 2010.
• 8,350,000 (pre incorporation of acquisition of Corvette), exercise price of 43.2 cents each, expiry date of 30 June 2010.

Each of the Options may convert into one Cape Lambert ordinary share provided that the Option holder exercises their right on or by the expiry date.

• $3.5$ Corvette has on issue the following share options ("Corvette Options") as at 17 August 2009:
• 2,350,000 Options (pre Takeover), exercise price of 20 cents each, expiry date of 30 April 2010:

• 400,000 Options (pre Takeover), exercise price of 20 cents each, expiry date of 31 December 2010:

• 687,500 Options (pre Takeover), exercise price of 20 cents each, expiry date of 30 June 2012; and

• 1,237,500 Options (pre Takeover), exercise price of 15 cents each, expiry date of 30 June 2012.

It is proposed that subject to shareholders approval, a further 500,000 Options (pre Takeover) exercisable at 15 cents each and expiring on 30 June 2012 will be granted.

The Bidder's Statement does not include an offer to acquire any of the existing Corvette Options. Corvette Option holders may exercise their Corvette Options between the record date and up to the end of the Offer Period, and thus convert their Corvette Options into ordinary Corvette Shares, and subsequently into Cape Lambert shares should the Takeover Offer be successful. For the purposes of this report it is assumed that the Corvette Options will not be converted into ordinary Corvette Shares. Should the Takeover Offer be successful and Cape Lambert is deemed to have acquired 90% of the ordinary voting capital of Corvette, Section 663A of the Corporations Act will be triggered and Cape Lambert will be required to compulsory acquire the Corvette Options. Therefore, for the purposes of this report we are ignoring the effects of the Corvette Options.

$3.6$ The total number of ordinary voting shares in Cape Lambert post acquisition (takeover of Corvette) will be 562,476,745 before the exercise of the Cape Lambert Options and the Corvette Options noted in 3.4 and 3.5 respectively and before any capital raising by Cape Lambert that may be undertaken in 2009. Assuming that all the Cape Lambert Options now outstanding are exercised and converted to Cape Lambert ordinary shares, and ignoring the effect of Corvette Options, the number of Cape Lambert ordinary voting shares on issue would increase to 598,826,745. Please note that as at the date of this report, 28,000,000 Cape Lambert Options are "in the money" (the exercise price of the options is 30.9 cents per option is less than the late July 2009 early August 2009 (to 7 August) share price per ordinary share of Cape Lambert trading on the ASX which amounts to between 34.5 cents and 36.0 cents). The existing Corvette ordinary shareholders would end up controlling 38,679,532 fully paid ordinary voting shares in Cape Lambert representing approximately 6.459% of the fully paid ordinary shares in Cape Lambert.

$\overline{4}$ . Profile of Corvette - Background

$4.1$ Principal Activities

The principal activity of the Corvette during the course of the financial year ended 30 June 2009 was the exploration for and development of gold and mineral sands projects in Australia.

$4.2$ State of Affairs

Corvette changed its name from Mineral Sands Limited to Corvette on 12 November 2008.

Significant changes in the state of affairs of the entity during the financial year ended 30 June 2009 were as follows:

$4.3$ Change in Consolidated Net Worth

During the year, the Shareholders Equity decreased by \$2.480 million to a balance totalling \$8,325,910, primarily due to the loss incurred in 2008/09. Corvette during the

2008/09 year capitalised approximately \$0.709 million of exploration expenditure and wrote-off approximately \$1.5 million of exploration expenditure as well as incurring \$0.554 million in salaries and wages.

$4.4$ Mineral Assets

Corvette's mineral and investment assets and opportunities at 30 June 2009 are summarised below. The details in this section were extracted from the Target Statement and other sources supplied by Corvette. We have not independently verified the assertions made.

"Corvette was incorporated on 29 November 2002 and listed on the ASX on 25 May The Company holds a 100% interest in mining tenements and tenement 2007. applications in Western Australia, Victoria, and Queensland. The company has granted exploration permits covering 7,395 km² and exploration licence applications covering a further 3,125 km².

The Company's main project is the Plumridge Gold Project, situated on the margin of the Albany Fraser Province and within the interpreted reworked transitional margin of the Yilgarn Block. This belt hosts the five million ounce Tropicana/Havana gold deposit, discovered by the Anglogold Ashanti/Independence JV partners. Excellent results are being achieved at what is a large (2,302 sq km), under-explored area.

The Company has also carried out exploration for heavy mineral sands with drilling programmes in the Murray and Otway Basins".

Location	Project	Granted Titles (km2)	Applications for Tenements (km2)	Total Area (km2)
Murray Basin	Wedderburn, Graybridge, Avonbank, Kalkee, Cannie West and Meridan,	1,200	288	1,488
Otway Basin	Otway	2,937		2,937
Albany Fraser Province	Plumridge	2,302		2.302
Cape York	Inkerman	956	2,837	3,793
Total Area km 2		7,395	3,125	10,520

Tenements

Plumridge Gold Project

The Plumridge Gold Project is located on the western Eucla Basin margins where the Basin sediments on-lap Proterozoic basement rocks of the Albany-Fraser Province.

Since June 2007, the Company has carried out a systematic auger gold geochemical sampling programme. The entire 2,302 sq km has been sampled on a 1000m by 200m grid, with infill sampling on high value areas. Over 60 anomalous zones have been identified that warrant further sampling (See fig 1).

Fig 1 Plumridge Project, Anomalous gold calcrete values.

Two areas were considered priority targets on the basis of

• large areas of contiguous high gold in calcrete values, and $(a)$
• peak values of +30 ppb Au (maximum result is 67 ppb Au). $(b)$

These two areas are the Corvette Prospect and the Southern Anomaly.

Since April 2008, 43,699 metres of aircore drilling has been completed, 10,037 metres on the Southern Anomaly, the balance on the Corvette Prospect. Aircore drilling on the Southern Anomaly has identified three areas of basement gold mineralization $(+0.1g/t)$ , these are:

• Barracuda
• Road Runner
• Charger

Anomalous gold to 4g/t Au as supergene enrichments and as end-of-hole intersections at the Corvette Prospect directed the Company to focus its attention there.

Aircore drilling of the geochemical anomaly at the Corvette Prospect commenced in April 2008 and has encountered supergene gold mineralisation near the base of weathering in felsic to intermediate gneisses. Mineralisation is associated with hydrothermal alteration and sulphidation evident at the base of the weathered rocks. Anomalous gold has been

outlined over 9 km of strike length, and in zones up to 300 m wide. The aircore drilling was designed to delineate zones for deeper reverse circulation (RC) drilling to locate the sources of the supergene gold.

The results of the Aircore drilling are shown in fig 2. The clear correlation between basement gold mineralization and the large structures indicated by the aeromagnetic backdrop show that the right structures exist for a large gold deposit to form.

Fig 2 Results of Aircore Drilling

RC drilling on Corvette has demonstrated high grade gold intersections in a number of locations within two arcuate sub-parallel geological structures that are approximately 300m apart and continuous for more than 9km (see fig 3). Limited drilling (10,000 m) has produced exceptional results including:

• 10 m at 8.3 g/t from 119 metres in hole CVRC 58
• 2 m at 2 g/t from 104 metres, 3 m at 5 g/t from 110 metres and 2 m at 3.5 g/t from 115 metres in hole CVRC 56
• 3 m at 1.1 g/t from 94metres, 2m at 1.1g/t from 114 metres and 1 m at 15.2 g/t from 119 metres in hole CVRC 58
• 6 m at 1.15 g/t Au from 75 metres in CVRC005
• 5 m at 0.9 g/t Au from 14m including 1 m at 3.20 g/t Au and 4 m at 2.07 g/t Au from 38 metres in CVRC016

5 m at 0.9 g/t Au from 14 metres in CVRC016, including 1 m at 3.20 g/t Au

Fig 3 Selected RC gold intersections, showing extent of gold mineralization at Corvette Prospect

"The Directors believe that these results indicate the potential of the Corvette Prospect to host several significant gold deposits, and also reinforce the prospectivity of the entire Plumridge Gold Project area".

"Over the next twelve months, it is planned to focus on one or more areas of the Corvette Prospect to delineate a JORC resource, assuming the continuation of these encouraging results. This work would include:

• diamond drilling in this quarter, partly funded by an Exploration Incentive Scheme (EIS) grant of \$140,000 from the Western Australian Government:
• expanded geophysical and geochemical surveys, both independently and in a funded collaboration with the CSIRO:
• further Aircore drilling; and
• further RC drilling".

Murray Basin

"The Murray Basin Projects are located in the west and north-west of Victoria and southwestern New South Wales. Within the Murray Basin Projects, Indicated and Inferred Resources have been estimated at Wedderburn, Graybridge, and Avonbank-Kalkee. Corvette also holds mineralization identified on the Cannie West Project, and a conceptual heavy mineral target at the Meridian ELA.

A bulk sample of ore from the Wedderburn deposit was collected in 2006 and has been the subject of metallurgical test-work. In March 2008, a second heavy mineral concentrate (HMC) sample was produced from the bulk sample, for further processing to products and for additional marketing research.

Customer acceptance trials for the fine grained heavy mineral products produced from the Wedderburn deposit, and believed to be typical of the Victorian Murray Basin resources, were not sufficiently encouraging to progress to a Bankable Feasibility Study. Work is continuing to identify customers and product niches where these materials will be accepted and, perhaps, be a preferred feedstock".

Mineral Resource

"In June 2007, Corvette reported Mineral Resource estimates for the Wedderburn and Graybridge deposits, and an upgraded estimate for the Avonbank deposit, which includes extensions to the deposit on the Kalkee tenement.

Resource estimation was undertaken by Snowden Mining Industry Consultants Pty Ltd using the inverse distance cubed method for grade estimation. Resources are reported at 3% THM cut-off and are summarised in Table 1".

						Corvette - Murray Basin Projects - Total Mineral Resource Estimate as at 30 June 2007
Inferred				Indicated			Total Resource
Deposit	Tonnes Mt	THM %	Zircon % within THM	Tonnes Mt	THM %	Zircon % within THM	Tonnes Mt	THM ℅	Zircon % within THM
Wedderburn	141.1	4.3	13.5	32.0	4.8	18.6	173.2	4.4	14.4
Graybridge	47.6	3.4	15.2		$\overline{\phantom{0}}$	$\blacksquare$	47.6	3.4	15.2
Avonbank/Kalkee	160.9	5.1	15.7	199.4	6.4	15.8	360.3	5.8	15.8
Total	349.6	4.6	14.7	231.4	6.2	16.2	581.1	5.2	15.3

Table 1: Murray Basin Snowden Report June 2007 Mineral Resource Estimate (at 3% THM cut-off)

Note: THM refers to total heavy minerals. Figures used are rounded.

Competent Person Attributes

"The information in this section of the Target's Statement that relates to the Mineral Resources of the Avonbank, Wedderburn and Graybridge projects owned by Corvette is based on information compiled by Mrs Christine Standing, who is a member of The Australasian Institute of Mining and Metallurgy and has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which she is acting to qualify as a Competent Person as defined in the 2004 Edition of the 'Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves'. Mrs Standing, who is a full-time employee of Snowden Mining Industry Consultants, consents to the inclusion in this Target's Statement of the matters based on her information in the form and context in which it appears.

The information in this section of the Target's Statement that relates to Exploration Results is based on information compiled by Mr Mark Teakle, who is a Member of the Australasian Institute of Mining and Metallurgy and a Member of the Australian Institute of Geoscientists. Mr Teakle is an employee of Corvette and has sufficient relevant experience to qualify as a Competent Person as defined in the 2004 Edition of the Australasian Code for Reporting of Exploration Results, Mineral resources and Ore Reserves. Mr Teakle consents to the inclusion in this Target's Statement of the matters based on his information in the form and context in which it appears".

End of extract from Target's Statement and information from Corvette

Further information regarding the Corvette gold and mineral sands projects, can be sourced from the Ravensgate Independent Technical Valuation Report dated 10 August 2009, which is appended to this report as Appendix B.

$4.5$ Corporate Structure

Corvette has no subsidiaries or investments in associates.

Financial Position 4.6

	Unaudited 30 June 2009 \$000	Audited 30 June 2008 \$000	Audited 30 June 2007 \$000
Current Assets
Cash Assets	1,759	2,289	10,272
Other Financial Assets		3,500	50
Receivables & Prepayments	183	128	268
Total Current Assets	1,942	5,917	10,590
Non-Current Assets
Deferred Exploration Expenditure	6,019	4,293	1,838
Other Financial Assets	769	743
Plant and Equipment	168	192	24
Deferred Tax Assets	2	$\overline{2}$
Total non current assets	6,958	5,231	1,862
Total assets	8,900	11,147	12,452
Current Liabilities
Trade and Other Payables	(526)	(289)	(389)
Provisions	(27)	(33)
Total current liabilities	(553)	(322)	(389)
Non Current Liabilities
Provisions	(21)	(19) (19)
Total Non Current liabilities	(21)	(341)	(389)
Total Liabilities	(574)
Net Assets	8,326	10,806	12,063
Equity
Issued Capital	12,843	12,843	12,843 190
Reserves	296	212	(970)
Accumulated Losses	(4, 813)	(2, 249)
Total Equity	8,326	10,806	12,063

The Balance sheets above indicate that some exploration expenditure is capitalised. Also indicated is a decline in cash and cash equivalent balances. Please note that Other Financial Assets include Term Deposits. Conversely, there is a steady increase in Deferred Exploration Expenditure and Accumulated Losses over the years ended 30 June 2009, 30 June 2008 and 30 June 2007.

Financial Performance 4.7

Losses incurred over the last year to 30 June 2009 (unaudited) by Corvette totalled \$2,564,477 and relates in the main to exploration expenditure written off (approximately \$1.5 million) and employee benefits expense including (salaries and wages, share based payments and superannuation) (totalling approximately \$807,000). These costs were partly offset by revenues of approximately \$419,000 which encompassed interest and other income. Losses incurred in the years ended 30 June 2008 and 2007 totalled \$1,279,000 and \$865,000 respectively. In assessing the Company's projects and the various stages of investigation and development they are unlikely to be in a position to pay dividends on the ordinary shares in the foreseeable future.

5. Profile of Cape Lambert - Background

$5.1$ Principal Activities

Cape Lambert is a listed mineral investment, exploration and development company on the ASX. It has interests in a geographically diverse portfolio of mineral projects and investments in several exploration and mining companies. The primary mineral commodities comprise iron ore, copper and gold.

$5.2$ Mineral Assets

The following list outlines the major projects which Cape Lambert has interests in. For further information relating to Cape Lambert's projects please refer to "Section 5.1 -Overview of Cape Lambert's activities" located within the Bidder's Statement.

• Lady Annie Oxide Copper Leach Project located in Mount Isa, Queensland, Australia. Held through the Cape Lambert Lady Annie Exploration Pty Ltd subsidiary;
• Marampa Iron Ore Project located near Lunsar, Sierra Leone. Cape Lambert holds a 35% interest in the project. It is also the Manager of the project;
• Sappes Gold Project located in North Eastern Greece. Cape Lambert owns 100% of this project through CLM:
• Lady Loretta Zinc Project located in Mount Isa, Queensland Australia. Cape Lambert holds a 25% interest in the project;
• Australis Exploration Pty Ltd a private company holding rock phosphate and secondary uranium deposit licences and applications located in the Northern Territory, Australia. It is 100% owned through CLM;
• Cape Lambert South Iron Project located in the Pilbara region of Western Australia. It is 100% owned by Cape Lambert; and
• Other Investments includes various holdings in other ASX, TSX and AIM listed vehicles.

5.3 Corporate Structure

For a detailed corporate structure of Cape Lambert, please refer to the Bidder's Statement. "Section 5.2 – Ownership and Structure of Cape Lambert" which outlines the material assets and key subsidiaries of the Cape Lambert Group.

$5.4$ Shareholding

According to the Bidder's Statement, as at 24 July 2009, Cape Lambert had 523,797,213 fully paid ordinary shares on issue at that date. As at 21 July 2009, the top five shareholders owned 54.42% of Cape Lambert's issued capital, whilst the top ten shareholders owned 67.79% of the ordinary shares of Cape Lambert and there were approximately 5,010 shareholders in total.

As at 24 July 2009, Cape Lambert has a total of 36,350,000 Cape Lambert Options on issue. 28,000,000 Cape Lambert Options are exercisable at 30.9 cents with an expiry date of 31 October 2010 (presently "in the money" as the current share price is in excess of the exercise price at date of this report) whilst the remaining 8,350,000 Cape Lambert Options are exercisable at 43.2 cents with an expiry date of 30 June 2010.

$5.5$ Financial Position

Cape Lambert's consolidated unaudited net assets as at 30 June 2009 are summarised below, in the pro-forma balance sheet. Since the date of the last review, 31 December 2008, Cape Lambert has embarked upon significant transactions. These transactions can be reviewed in the Bidder's Statement at "Section 8 - Financial Information". The effects of these transactions, inter alia, have resulted in the pro-forma balance sheet as noted below.

	Unaudited Pro-forma 30 June 2009	Audited 30 June 2008	Audited 30 June 2007
	\$000	\$000	\$000
Current Assets
Cash assets (including			1,917
Restricted Cash)	81,080	16,137 261	5,048
Trade and Other Receivables	51,342 4,228
Inventories
Non-Current Assets Held for Sale		56,861
Total Current Assets	136,650	73,259	6.965
Non Current Assets
Trade and Other Receivables	4,479	8	12
Financial Assets	37,315	4,051	4,429
Restricted Cash	9,284	171	288
Property, Plant and Equipment	8,404	161	239
Exploration and Other Mineral
Assets	169,099	28	38,325
Intangible Assets (Goodwill)	23,505
Investment in Associates	39,238
Loans to Associates	68
Deferred Tax Asset		3,864
Total Non Current Assets	291,391	8,283	43,293
Total Assets	428,041	81,542	50,258
Current Liabilities
Trade and Other Payables	14,781	618	2,261
Deferred Consideration	10,000
Interest Bearing Liabilities	14,525
Income Tax	22,983	5,000
Deferred Income	250	5,618	2,261
Total Current Liabilities	62,540
Non Current Liabilities	41,896	8
Deferred Tax Liability	11.923
Provisions	53,819	8
Total Non Current Liabilities	116,358	5,626	2,261
Total Liabilities	311,683	75,916	47,997
Net Assets
Equity		82,008	54,095
Issued Capital	125,111 5,075	15,458	17,663
Reserves	181,497	(21, 550)	(23, 761)
Retained (Profits)/Losses	311,683	75,916	47,997
Total Equity

COR5117\IER\Corevtte IER 18 August 2009

The net asset (book value) backing per fully paid (pre acquisition of Corvette) ordinary Cape Lambert share as at 30 June 2009 based on 523,797,213 ordinary shares on issue is approximately 59.5 cents per ordinary share. The above balance sheet recognises an approximate unaudited profit of \$203 million for the year ended 30 June 2009 thus resulting in retained profits being carried forward (retained losses as at 30 June 2008 and 30 June 2007) as well as the acquisitions of the CopperCo assets (including the acquisition of Minsec including the effect of the downward acquisition of 19.99% of Corvette). The above pro-forma balance sheet does not take into account the payment of dividends (if any) as at 30 June 2009 to ordinary shareholders of Cape Lambert.

5.6 Financial Performance

Cape Lambert's unaudited consolidated financial result for the year ended 30 June 2009 amounts to approximately a profit of \$203,048,046. In comparison, the result for the year ended 30 June 2008 (audited) amounted to a profit of \$2,179,472. The predominant reason for this large spike in profit is the one-off sale of the Cape Lambert Magnetite Iron ore project for \$400,000,000 to the China Metallurgical Group Corporation ("MCC"). Cape Lambert posted a loss of \$3,945,284 for the year ended 30 June 2007.

6. Methodology

6.1 Criteria for assessment of fairness and reasonableness

In forming our opinion as to whether the Corvette Takeover Offer by Cape Lambert is in the best interest of the Shareholders of Corvette, we have considered the following definitions of "fair" and "reasonable" outlined in RG 111 issued by the Australian Securities and Investments Commission.

• $\bullet$ an offer is "fair" if the value of the offer price or consideration being offered is equal to or greater than the value of the securities that are the subject of the offer; and
• an offer is "reasonable" if it is fair, or where it is "not fair", it may still be "reasonable" after considering other significant factors which support the acceptance of the offer in the absence of a higher bid.
• 6.2 Under these definitions, the Takeover Offer for all of the Ordinary Shares in Corvette would be considered fair and reasonable to the Shareholders of Corvette and in the best interests of all such Shareholders if the terms of the Takeover values the Cape Lambert shares (and cash equivalent being offered to overseas shareholders of Corvette) at an amount that is equal to, or greater than, the assessed value of the Ordinary Shares in Corvette being acquired via the Takeover Offer.
• 6.3 Valuation Methodology – Corvette and Cape Lambert

In assessing the value of Corvette and Cape Lambert we have considered a range of valuation methods. RG 111 states that it is appropriate for an independent expert to consider various methods of valuation. The valuation methodologies we have considered in determining a theoretical value of a Corvette and Cape Lambert share are noted below.

Capitalisation of Future Maintainable Earnings ("FME") $6.3.1$

This method places a value on the business by estimating the likely FME, capitalised at an appropriate rate which reflects business outlook, business risk, investor expectations,

future growth prospects and other entity specific factors. This approach relies on the availability and analysis of comparable market data. The FME approach is the most commonly applied valuation technique and is particularly applicable to profitable businesses with relatively steady growth histories and forecasts, regular capital expenditure requirements and non-finite lives. The FME used in the valuation can be based on net profit after tax or alternatives to this such as earnings before interest and tax ("EBIT") or earnings before interest, tax, depreciation and amortisation ("EBITDA"). The capitalisation rate or "earnings multiple" is adjusted to reflect which base is being used for FME.

$6.3.2$ Discounted Future Cash flows ("DCF")

The DCF methodology is based on the generally accepted theory that the value of an asset or business depends on its future net cash flows, discounted to their present value at an appropriate discount rate (often called the weighted average cost of capital). This discount rate represents an opportunity cost of capital reflecting the expected rate of return which investors can obtain from investments having equivalent risks. A terminal value for the asset or business is calculated at the end of the future cash flow period and this is also discounted to its present value using the appropriate discount rate. DCF valuations are particularly applicable to businesses with limited lives, experiencing growth, that are in a start up phase, or experience irregular cash flows.

6.3.3 Net Tangible Asset Value on a Going Concern Basis

Asset based methods estimate the market value of an entity's securities based on the realisable value of its identifiable net assets. Asset based methods include:

• Orderly realisation of assets method
• Liquidation of assets method
• Net assets on a going concern method

The orderly realisation of assets method estimates fair market value by determining the amount that would be distributed to entity holders, after payment of all liabilities including realisation costs and taxation charges that arise, assuming the entity is wound up in an orderly manner. The liquidation method is similar to the orderly realisation of assets method except the liquidation method assumes the assets are sold in a shorter time frame. Since wind up or liquidation of the entity may not be contemplated, these methods in their strictest form may not be appropriate. The net assets on a going concern method estimate the market values of the net assets of an entity, but do not take into account any realisation costs. Net assets on a going concern basis are usually appropriate where the majority of assets consist of cash, passive investments or projects with a limited life. All assets and liabilities of the entity are valued at market value under this alternative and this combined market value forms the basis for the entity's valuation.

Often the FME and DCF methodologies are used in valuing assets forming part of the overall Net assets on a going concern basis. This is particularly so for exploration and mining companies where investments are in finite life producing assets or prospective exploration areas.

These asset based methods ignore the possibility that the entity's value could exceed the realisable value of its assets as they do not recognise the value of intangible assets such as management, intellectual property and goodwill. Asset based methods are appropriate when entities are not profitable, a significant proportion of the entity's assets are liquid or for asset holding companies.

6.3.4 Ouoted Market Basis

Another alternative valuation approach that can be used in conjunction with (or as a replacement for) any of the above methods is the quoted market price of listed securities. Where there is a ready market for securities such as the ASX, through which shares are traded, recent prices at which shares are bought and sold can be taken as the market value per share. Such market value includes all factors and influences that impact upon the ASX. The use of ASX pricing is more relevant where a security displays regular high volume trading, creating a "deep" market in that security.

Alternative Takeover offer $6.3.5$

Where any recent genuine offers have been received for the shares being valued it is appropriate to consider those offers in determining the value of the shares. In considering any alternative offers it is necessary to assess the extent to which the alternative offers are truly comparable and to make adjustments accordingly.

$7.$ Valuation of Corvette Shares

Valuation method Adopted for Corvette $7.1$

The preferred valuation method used to value the shares of Corvette is the net asset value method although consideration has also been given to the share price of Corvette as a comparison with the share price of Cape Lambert. In order to determine the net asset value of Corvette, we have instructed an independent technical expert, Ravensgate Pty Ltd ("Ravensgate") specialising in the valuation of mineral assets to provide a value for Corvette's mineral assets. The Ravensgate Valuation Report dated 10 August 2009 is appended to this report as Appendix B.

The valuation of a target should be based upon a 100% interest in that target which should include a premium for control. This premium of control will be incorporated into the valuation of Corvette (the Corvette shares).

We have not considered the FME and DCF methods as appropriate to value the share of Corvette due to the lack of profit history arising from business undertakings and the lack of a reliable future cash flow from a current business activity.

It is possible that a potential bidder for Corvette could purchase all or part of the existing shares, however no certainty can be attached to this occurrence. To our knowledge, there are no other current bids in the market place (other than the bid by Cape Lambert), thus the use of this valuation method is not relevant for the purposes of this report.

The quoted market price method has been evaluated for the purposes of this report. In order for a quoted market price to be a reliable indicator of the of a company's value, that company must trade in a fully informed and appropriately informed market. However, this method does not include a market premium for control and as such we have added a premium for control to our quoted market price valuation.

Adjusted Net Asset Value of Corvette Shares $7.2$

We set out below Corvette's unaudited net assets as at 30 June 2009 based on Corvette being a going concern. As there is no intention to wind up the Company, we have not considered wind up values for the purposes of this report. We have been advised that

Corvette has not been involved in any significant (material) transactions subsequent to 30 June 2009 not already referred to in this report or the Target Statement. In addition. incorporated are the estimated valuations of the mineral assets of Corvette as determined by Ravensgate in their Valuation Report dated 10 August 2009.

	Ref	Unaudited 30 June 2009 \$000	Low Valuation \$000	Preferred Valuation \$000	High Valuation \$000
Current Assets
Cash Assets	7.2.1	1.759	1.259	1,259	1,259
Receivables &
Prepayments		183	183	183	183
Total Current Assets		1,942	1,442	1,442	1,442
Non-Current Assets
Deferred Exploration
Expenditure	7.2.2	6,019	7,360	21,100	31,200
Other Financial Assets		769	769	769	769
Plant and Equipment		168	168	168	168
Deferred Tax Assets		2	$\overline{2}$	$\overline{2}$	2
Total non current
assets		6,958	8,299	22,039	32,139
Total assets		8,900	9,741	23,481	33,581
Current Liabilities
Trade and Other
Payables		526	526	526	526
Provisions		27	27	27	27
Total current liabilities		553	553	553	553
Non Current
Liabilities
Provisions		21	21	21	21
Total Non Current
liabilities		21	21	21	21
Total Liabilities		574	574	574	574
Net Assets		8,326	9.167	22.907	33,007
Shares on Issue: Value of a Corvette		116,038,596	116,038,596	116,038,596	116,038,596
Share (in cents)		7.17	7.90	19.74	28.44

The unaudited 30 June 2009 contributed equity is disclosed at approximately \$12,843,000 and accumulated losses are approximately at \$4,813,000 and reserves approximate \$296,000 to total net assets of approximately \$8,326,000. Thus the net asset (book value) backing per fully paid share is 7.17 cents per share.

The following adjustments were made to the 30 June 2009 unaudited balance sheet of Corvette to arrive at the three valuations.

• $7.2.1$ The Cash balance was reduced to reflect the estimated administration and corporate expenses of \$500,000 for the period 1 July 2009 to 30 September 2009.
• Deferred exploration expenditure is adjusted to reflect the values indicated by the $7.2.2$ Ravensgate report. Ravensgate was commissioned on 30 June 2009 to provide a market valuation of Corvette's mineral assets in order to assist us in assessing the market value of Corvette when considering the Cape Lambert Takeover offer. Ravensgate has provided

three market indications as to the potential value of the projects, which have been disclosed in the table above. Accordingly, the balance sheet has been adjusted to reflect the valuation ranges.

$7.2.3$ There have not been any other material changes in the values of other assets.

The above table indicates the net asset value of a Corvette share between 7.90 and 28.44 cents, with a preferred value of 19.74 cents per Corvette share.

• $7.3$ Quoted Market Basis - Corvette Share Price
• $7.3.1$ In addition to the adjusted net asset valuation of Corvette shares in Section 7.2, we have also assessed the quoted market price for a Corvette share.
• $7.3.2$ Initially we have examined the price prior to the Cape Lambert and CopperCo pre-bid agreement disclosed to the market on the 8 May 2009 in order to exclude any premium that may be included in the share price that could relate to the effects of a Takeover and speculation of a premium offer. However, it is noted that since the pre-bid agreement, Corvette has disclosed favourable drilling results in relation to the flagship Corvette Gold Project and this has been taken into account in the price per share used for valuation purposes.

Between 1 January 2009 and 7 May 2009 (the day before the announcement of a pre-bid agreement between Cape Lambert and CopperCo), the volume weighted average price (VWAP) of a fully paid Corvette share traded in the 3.5 cents to 7.1 cents range on substantial volumes (particularly in the months of March and April) with the last sale price on 7 May 2009 being 7.0 cents per share.

Since 1 January 2009 and up to and including 17 August 2009, the fully paid share prices (on-market sales) have been as follows:

	High Cents	Low Cents	Volume Weighted Average Last Sale Cents	Volume 000's
January 2009	6.9	4.6	6.4	481
February 2009	6.0	3.5	5.8	492
March 2009	5.5	3.8	4.5	1,769
April 2009	7.1	4.0	5.9	2,470
May 2009	11.5	7.0	8.6	2,414
June 2009	13.5	10.0	12.3	1,881
July 2009	15.5	12.5	14.2	2,645
August 2009 (to
17 th	15.0	13.5	14.0	5,078

The Corvette share price has drifted upwards since January 2009 reflecting the success in exploration results pertaining to the Corvette Gold Project. The quarterly reports for the periods to 31 March 2009 and 30 June 2009 reflect on this matter.

For the intervening period from the announcement of the pre-bid agreement signed on 7 May 2009 and alluded to elsewhere in this report and up to the date of the Takeover Panel decision on 17 June 2009 (which upheld the ASIC ruling against providing Cape Lambert relief in relation to the downstream assets of Minsec which included, inter alia, an initial 35% interest in Corvette), the shares in Corvette traded in the 7.0 cents to 12.5 cents range, closing at 12.5 cents per share.

Following the decision of the Takeover panel up to the date of Cape Lambert's announcement of a proposed Takeover Offer for the remaining shares in Corvette, being 6 July 2009, the share price traded in the 11.0 cents to the 13.0 cents range with the last sale price on 3 July 2009 being 13 cents per share. During this period, it is noted that Corvette had announced favourable results in relation to the Plumridge Gold Project (on 25 June $2009$ ).

As outlined in RG 111, the post announcement share price after the announcement of a bid may reflect some of the benefits of the combined entity, depending on whether the market has confidence that the transaction will proceed. After the announcement of the Cape Lambert Bid for Corvette on 6 July 2009 and up to and including 17 August 2009, the Corvette share price ranged from a low of 12.5 cents to a high of 15.5 cents (immediately post the Cape Lambert announcement). The last sale on 17 August 2009 was at 14.0 cents.

In light of the above, our assessment of the ASX market value of a Corvette share is between 11 and 15.5 cents per share. This quoted price range excludes a premium for control. Therefore, we have estimated a premium for control that Corvette shareholders could expect to receive pending a successful takeover, and thus control, of Corvette by Cape Lambert. In view of a successful takeover by Cape Lambert, a premium to the quoted market share price of Corvette may be expected due to the following advantages that Cape Lambert may receive:

• control over decision making and strategic direction;
• access to underlying cash flows;
• control over dividend policies; and
• access to potential tax losses.

We have examined anecdotal evidence of premiums for control paid in Australia and globally for junior and mid cap exploration companies. The range paid for control oscillates between 19% and 43%. As such we have selected a 20% control premium payable to Corvette shareholders. Applying this premium to Corvette's quoted market share price, the quoted market price payable to Corvette's shareholders (inclusive of a premium for control) ranges between 13.2 and 18.6 cents per share. Arguably, the premium for control could be higher than 20% as the interest in potential gold producers is quite high at the moment.

• Conclusion on the Value of Corvette Shares 7.4
• In Sections 7.2 and 7.3 we have discussed the adjusted net asset value and quoted market 7.4.1 price offer values of a Corvette share. These values are summarised below:

	Low value per share Cents	Preferred value per share Cents	High value per share Cents
Adjusted Net Asset Value basis (preferred basis)	7.90	19.74	28.44
Quoted Market Price basis (cents)	11.00	14.50	15.50
Ouoted Market Price basis with a control premium 20% of attached say (cents)	13.20	17.40	18.60

The valuations above indicate that the adjusted net asset value per share is greater than the quoted market price of a Corvette share (other than for the low valuation). As at the end of July 2009, the last seven months of trading have seen 12,152,325 Corvette shares trade on the ASX, which is less than 10.5% of the total issued capital of Corvette. Based on the volumes of Corvette shares traded on the open market (ASX), we do not consider that the shares demonstrate sufficient liquidity to reflect a reliable valuation and in any event it is considered more suitable to assess a targets underlying technical value in assessing whether a takeover offer is fair and reasonable. Consequently as a result of the low volumes, the quoted market price (including a control for premium) that ranges from 13.2 to 18.6 cents per share may be distorted. Therefore, it is considered appropriate to use the adjusted net asset value for Corvette, ranging from 7.90 to 28.44 cents per share, with a preferred value of 19.74 cents per share. In assessing the reasonableness of the Takeover Offer, we have considered the share price of a Corvette share, albeit trading on low volumes as some guide as to reasonableness or otherwise.

8. Valuation of Cape Lambert Shares

8.1 Valuation method adopted for Cape Lambert

We have identified that the quoted market price valuation method for a share in Cape Lambert is the most appropriate for the purposes of this report. RG 111 stipulates that where the value of securities (in this case scrip) is offered as consideration in the takeover bid, that scrip should be based on a value which constitutes a minority interest in the Bidder's entity.

Market value is the price per share as quoted on the ASX. The share market price would, prima facie constitute the market value of the shares of a publicly traded company. The share price quoted on the ASX reflects the markets' assessment of all of the information available on the relevant company, the industry and the general economic environment in which the companies trade. The share price is, in most circumstances, a reliable indicator of the realisable value of a minority holding or a relatively small parcel of shares and does not always reflect the market value offering control of the acquirer. In the circumstances where interests in mineral assets are under question, we believe that share prices as quoted on the ASX is acceptable in determining the value of a Cape Lambert share.

Accordingly, as the quoted market price method does not include a premium for control, and because this method reflects the value of shares that will be provided to Corvette's shareholders should they accept the offer, we have decided that this valuation represents the most appropriate valuation method.

We have not considered the FME and DCF methods as appropriate to value the share of Cape Lambert due to the lack of profit history arising from business undertakings in the prior vears. The principal assets of Cape Lambert lie in interests or potential interests in mineral exploration and mining projects and investments. The mineral assets have limited lives and future profitability depends on the outcome of exploration programs that are not predictable. It is only in the financial year ended 30 June 2009 where the Company has managed to realise a significant profit on the sale of assets. Furthermore, due to the lack of reliable future cash flows from current business activities, it was considered that these valuation methods are not appropriate in the circumstances. In any event Corvette shareholders would be receiving quoted Cape Lambert shares if they accepted the Takeover Offer and any technical value of a Cape Lambert share is not relevant.

We have not considered independent valuations of the mineral project interests of Cape Lambert to be necessary. However we do offer comments on the projects and book asset valuations elsewhere in this report. All projects arguably have significant value if commercial arrangements can be finalised.

8.2 Quoted Market Basis - Cape Lambert Share Price

Share prices in Cape Lambert as recorded on the ASX since 1 January 2009 up to and including 17 August 2009 have been as follows:

	High Cents	Low Cents	Volume Weighted Average Last Sale	Volume 000's
			Cents
January 2009	31.5	23.0	27.9	24,890
February 2009	28.0	24.0	26.5	8,692
March 2009	28.0	22.0	25.2	13,938
April 2009	27.0	24.5	25.6	12,028
May 2009	34.5	24.5	31.8	37,552
June 2009	37.0	30.0	34.8	79,783
July 2009	36.0	32.0	34.2	71,382
2009 August (to
$17^{\rm th}$	41.5	35.0	36.90	136,986

The value of a Cape Lambert share since 1 January 2009 and up to and including 17 August 2009 has ranged from a low of 22 cents per share to a high of 41.5 cents per share. This represents volatility of approximately 89% over the approximated 7.5 month period and the combined volume weighted average last sale price is 33.06 cents per Cape Lambert share (to 7 August 2009). The total number of shares traded over the January to July 2009 seven month period totalled 248,265,501 and this represented roughly 47% of the issued capital of Cape Lambert as at 24 July 2009. This indicates a reasonable level of liquidity in the shares of Cape Lambert.

For the period from 1 January 2009 and up to and including the 7 May 2009, the price of a Cape Lambert share gravitated between 22 cents and 31.5 cents per share. The Cape Lambert share price experienced a notable increase following the announcement of the acquisition of assets from CopperCo (including signing the pre-bid agreement with CopperCo to purchase the indirect Corvette shareholding). The share price on 7 May 2009 amounted to 28 cents per ordinary Cape Lambert share and upon the announcement of the CopperCo acquisition of assets on 8 May 2009, the share price closed at 34.5 cents per ordinary share. Whilst very little of this increase in share price can be attributed to the acquisition of Corvette, nonetheless the acquisition of a minority shareholding in Corvette may have had an influence on the increase in share price. In all probability, the significant reason for the share price rise was due to the copper assets acquired from CopperCo.

In the intervening period from 8 May 2009 and up to the date of the announcement by Cape Lambert to Takeover Corvette on 6 July 2009, the Corvette share price ranged from 29.5 cents to 37 cents per share.

The price per Cape Lambert share post announcement of the Corvette Takeover on 6 July 2009 and up to and including 17 August 2009, oscillated from between 32 cents to a high of 41.5 cents per share. The closing price on 17 August 2009 was 37.0 cents. On 17 August approximately 60 million shares were sold by Evras Group SA to various parties at 35 cents per share.

It should be noted that over the January 2009 to July 2009 period, Cape Lambert issued 17,000,000 shares as consideration for the acquisition of a percentage of the Marampa Iron Ore project. In addition, Cape Lambert has made a number of announcements relating to the acquisition of new investments (eg DMC Mining Limited). Other than the announcement of the purchase of the CopperCo assets, no single announcement has had a significant impact upon the share price of Cape Lambert (movement in excess of 15% on the previous days' last sale price).

8.3 Conclusion on the Value of Cape Lambert Shares

Having considered the pre and post announcement pricing of the Cape Lambert shares in Section 8.2, it is our view that a fair indicative range for a Cape Lambert share is between 32.0 cents to 38.5 cents per share based upon trading activity in the post CopperCo acquisition period from 8 May 2009 through to 17 August 2009. Given that this period experienced the largest volume of Cape Lambert share transactions, it is likely to be highly indicative of the true value of a Cape Lambert share on an open market (ASX). The volume weighted average last sale price for the period from 8 May 2009 and up to 7 August 2009 is 34.89 cents per share. Thus it is considered appropriate to use a range of 32.0 to 38.5 cents per Cape Lambert share, with a preferred value of 36 cents per share. It is noted that the closing share price on 17 August 2009 was 35.5 cents and 60,000,000 shares were sold by one shareholder to various institutions at 35 cents per share on that date.

$9₁$ Value and Fairness of Consideration Compared To Value of Assets Acquired

$9.1$ Value of Consideration Compared to Value of Assets Acquired

Cape Lambert is offering 0.417 of a Cape Lambert share for every 1 Corvette Ordinary Share held on the Record Date. The value of a share offered by Cape Lambert for a fully paid ordinary share in Corvette is as follows:

	Para Ref	Low Cents	Preferred Cents	High Cents
Value of a Cape Lambert share (based on
Quoted Market Price)	8.3	32.0	36.0	41.5
Shares to be exchanged (in terms of a
Corvette share)		0.417	0.417	0.417
Value of a Cape Lambert Share to be exchanged		13.34	15.01	17.30
The value of a Cane I ambert share to be exchanged for each $G_2$

The value of a Cape Lambert share to be exchanged for each Corvette share is compared below:

	Para Ref	Low Cents	Preferred Cents	High Cents
Value of a 0.417 Cape Lambert share Value of a Corvette share on a technical net	9.1	13.34	15.01	17.30
asset value (Discount)/Premium payable by Cape	7.4	7.90	19.74	28.44
Lambert (cents) (Discount)/Premium payable by Cape		5.44	(4.73)	(11.14)
Lambert (percentage)		40.77	(31.51)	(64.39)

Stantons International Securities AFS Licence No. 319600

	Para Ref	Low Cents	Preferred Cents	High Cents
Value of a Corvette share as listed on ASX
(cents)		11.00	14.50	15.50
Value of a Corvette share as listed on ASX
with a control premium of 20% (cents)		13.20	17.40	18.60
(Discount)/Premium payable by Cape
Lambert (percentage) on a share price basis
(percentage)		17.54	3.39	10.40
(Discount)/Premium payable by Cape
Lambert (percentage) on a share price basis
incorporating a 20% premium for control
(percentage)		1.04	(15.92)	7.51)

We have examined anecdotal evidence of premiums for control paid in Australia and globally for junior and mid cap exploration companies. The range paid for control oscillates between 19% and 43%. As such we have selected a 20% control premium payable to Corvette shareholders. Applying this premium to Corvette's quoted market share price, the quoted market price payable to Corvette's shareholders (inclusive of a premium for control) ranges between 13.20 and 18.60 cents per share. Arguably, the premium for control could be higher than 20% as the interest in potential gold producers is quite high at the moment.

Other than a premium based on the low technical value of a Corvette share, Cape Lambert is not paying a premium for control based on the preferred and high technical values for a Corvette share. In fact Cape Lambert is offering discounts as noted above.

Based on share prices, Cape Lambert is not paying any significant premium for control.

9.2 Fairness of Consideration Compared to Value of Assets Acquired

The above table indicates that the value on a cents per share basis of the Takeover Offer is less than the assessed preferred fair value of a Corvette share. Therefore the Takeover Offer is not considered to be fair.

Reasonableness of the Takeover Offer to Corvette Shareholders 10.

10.1 Under RG 111, an offer may be considered 'reasonable' if despite being 'not fair', should sufficient reasons exist for security holders to accept the offer in the absence of any higher bid before the close of the offer.

In considering the reasonableness of the Takeover Offer, inter alia, we have considered the following factors:

• Cape Lambert's pre-existing voting power in the securities of Corvette;
• Other significant security holding blocks in Corvette;
• Liquidity of the market in Corvette's securities;
• Taxation losses, Cash flow or other benefits through achieving 100% ownership of Corvette;
• Any special value of Corvette to Cape Lambert;
• The likely market price of Corvette shares should the Takeover Offer be unsuccessful; and

The value to an alternative bidder and likelihood of an alternative offer being $\overline{a}$ made for the shares in Corvette.

We set out below some of the advantages and disadvantages and other factors pertaining to the proposed Takeover of Corvette as they apply to the shareholders of Corvette.

Advantages

• The amalgamated entity (Cape Lambert incorporating Corvette) would create a larger $10.2$ mineral exploration company with a larger asset base, although Corvette is significantly smaller than the existing Cape Lambert Group. The merged group would have assets and opportunities in the following:
• Access to significant cash resources as noted in the pro-forma unaudited balance sheet in Section 5.5 of this report.
• Investments in other ASX, AIM and TSX listed companies please refer to "Section 5.2 – Ownership and Structure of Cape Lambert" in the Bidder's Statement.
• Investments in projects as outlined in Section 5.2 of this report

Corvette is currently relying on the success or otherwise of its flagship Plumridge Gold Project and it hopes to commercialise in the future. The risk to the shareholders of Corvette is reduced by diversifying and having an interest in a basket of assets, although the percentage interest in the underlying Corvette assets is substantially reduced. Currently Corvette has interests in gold and heavy mineral sands projects, whereas Cape Lambert has interests in copper (Lady Annie project), zinc (Lady Loretta project), iron ore (Cape Lambert South project and Marampa Project) as well as gold (Sappes gold project). The reduction from an existing Corvette shareholders point of view is from a 100% interest in Corvette that has the various projects outlined in Section 4.4 of this report to a small minority 6.459% voting interest in Cape Lambert.

• Cape Lambert has demonstrated its ability in the past two years to raise significant capital, $10.3$ and as such Corvette may benefit from Cape Lambert's ability to raise significant amounts of capital required to evaluate and fund projects. However, Corvette does have an interesting gold project that looks promising and with a renewed interest in gold exploration companies, Corvette should not find it too challenging to raising further working capital in the near future.
• The amalgamated Cape Lambert (post Takeover of Corvette) entity may be in a better $10.4$ financial position to make further strategic acquisitions in the mining industry that if carefully managed, may add value to Cape Lambert.
• The amalgamated Cape Lambert (post Takeover of Corvette) entity will have highly $10.5$ explorative assets. The proposed amalgamated entity's larger and more diversified range of mineral assets and opportunities may attract a greater number of potential investors than currently invest in Corvette individually. Combined with a larger and diversified shareholder base, an increase may result in the liquidity in the trading of the proposed merged entity's securities on ASX.
• The amalgamated Cape Lambert (post Takeover of Corvette) entity will in the event of a $10.6$ 90% or more acquisition of Corvette, contain the Board of directors of Cape Lambert or their nominees. The Board of Cape Lambert together with its expert technical team may enhance the chance of successfully commercialising Corvette's projects (although this cannot be assured or guaranteed). However, the Plumridge Gold Project is relatively

smaller that the existing Cape Lambert projects and may not necessarily get the attention of Cape Lambert management on a timely basis.

• In the event of the failure to commercialise the Plumridge Gold Project, there is an $10.7$ increased chance that Corvette may not survive as a listed company or at least the share price would be dramatically reduced in the short/medium term. However, it will still have the mineral sands project. By amalgamating Corvette into Cape Lambert, notwithstanding a reduced direct interest in Corvette's current mineral interests and opportunities, the shareholders risk is reduced.
• The volume of Corvette shares trading on ASX trading on the ASX is not high over the 10.8 last 7 months to the beginning of August 2009. Please refer to Section 7.4 of this report for more information. The Takeover Offer by Cape Lambert is to acquire all remaining shares not held by Cape Lambert, thus allowing existing shareholders to exchange the more illiquid shares (Corvette shares) into more liquid equivalent shares (Cape Lambert shares). However, as the Plumridge Gold Project is more advanced, it is expected that there would be a renewed interest in Corvette shares trading on the ASX.

Disadvantages

• The Takeover Offer is not considered to be fair as outlined in Section 9.2 of this report. 10.9
• Corvette shareholders will be effectively diluting their interest in a company that has the $10.10$ potential to develop a potential gold asset (the Plumridge Gold Project) should it become commercially viable. The potential value may be far in excess of the current share price of a Corvette share and thus by accepting the Takeover Offer, the Corvette shareholders would be dramatically reducing their collective interests in the Corvette Gold Project opportunity.
• 10.11 There are inherent difficulties in assessing the value of a Corvette share due to the effect on the Corvette share price of the proximity of the pre-bid agreement between Cape Lambert and CopperCo (to acquire amongst others an interest in Corvette), the time of the formal Takeover Offer by Cape Lambert and the various announcements of significant drilling results at the Plumridge Gold Project. It is difficult to assess the true value of a Corvette shares should the Takeover Offer have not had been made. It is noted that there is considerable interest in gold exploration companies in recent times and a number of mergers and takeovers are occurring in the industry. The shares in Corvette have already started to be re-rated and there is always the potential for the share price to rise further, particularly if the Plumridge Gold Project proves successful. There may be opportunities for future takeover offers for the Company notwithstanding the 19.99% shareholding by the Cape Lambert Group.
• 10.12 Should the Takeover Offer be accepted, Corvette shareholders will be exposed to the risks associated with investments in Cape Lambert. Cape Lambert's investment portfolio is different to that of Corvette, and as such carries different risks to shareholders of Corvette.

Other Factors

• 10.13 The Australian tax consequences for Corvette shareholders who accept the Takeover Offer will depend on a number of factors, including:

• whether the Corvette shareholder holds their Corvette shares on capital account, revenue account or as trading stock;

• the nature of the Corvette shareholder (i.e. individual, company, trust, complying superannuation fund); and

• the tax residency status of the Corvette shareholder (i.e. Australian resident or $\bullet$ not).

Each Shareholder should seek their own independent tax advice on the consequences of accepting the Takeover Offer and receiving Cape Lambert shares in exchange for Corvette shares.

If Cape Lambert acquires less than 80% of the shares in Corvette, then it is possible that the exchange of Corvette shares for Cape Lambert shares will be considered as a taxable event by the Australian Tax Office. This means that, depending upon the circumstances of the individual shareholder, a capital gain and or assessable income may be realised during that financial year. As stated above, Corvette shareholders should seek their own independent taxation advice if they intend to accept the Cape Lambert Takeover Offer.

For further information please refer to "Section $9 -$ Australian Tax Considerations" in the Bidder's Statement.

• 10.14 In light of the comments made regarding the proximity of announcements of the Takeover Offer and favourable drilling results as noted in Section 10.11 of this report, it is difficult to estimate the effect of the Corvette share price as a result of the withdrawal of the Takeover Offer. We acknowledge the other significant block of interest in the Corvette shareholding (refer to Section 3.2 of this report) is held by CopperCo and we have not been made aware of any similar Takeover Offer from this shareholder. We note that CopperCo that is in liquidation and has a receiver and manager appointed may dispose of their interest as discussed in Section 1.2 of this report.
• 10.15 There are other risks associated with the Takeover Offer and these are outlined in "Section 11- Risk Factors" of the Cape Lambert Bidder's Statement and the Corvette Target Statement (Section 7.8) also refers to risks. These include the possible downgrading of the exploration assets and opportunities of the two companies and dependence on key personnel.
• 10.16 On a market based premise, Cape Lambert is not paying any significant premium for control. As stated above, a premium for control is normally 20% or more. In this case, there is minimal premium based on the share prices of late July 2009 to 17 August 2009.
• 10.17 If the Takeover Offer is not accepted, Corvette will have a 19.99% shareholder being in effect the Cape Lambert Group. Such shareholder would wish to maximise its shareholding in Corvette and thus may be supportive financially and/or technically in the future (although this cannot be guaranteed). Cape Lambert is in effect a cornerstone investor. At the same time the 19.99% shareholding can be considered by some to represent an overhang in the market.
• 10.18 Conclusion as to the Reasonableness of the Takeover Offer

It is noted that ultimately the disadvantages of accepting the Takeover Offer noted in Section 10 of this report, coupled with the fact that the price is not considered to be fair arguably exceed the advantages, although the financial effects cannot be determined with any degree of certainty.

Conclusion as to Fairness and Reasonableness of the Takeover Offer $11.$

We have considered the Terms of the Takeover Offer as outlined in the body of this report 11.1 and have concluded that the Takeover Offer by Cape Lambert to offer 0.417 of a Cape Lambert share for every 1 Corvette Share held on the Record Date is, on balance, not fair and not reasonable to the non associated shareholders of Corvette (not associated with Cape Lambert).

Sources of Information $12.$

• In making our assessment as to whether the Takeover Offer to Corvette Shareholders by $12.1$ Cape Lambert is fair and reasonable to the non associated shareholders we have reviewed relevant published available information and other unpublished information of the Company and Cape Lambert which is relevant to the current circumstances. In addition, we have held discussions with the management of Corvette about the present and future operations of Corvette. Statements and opinions contained in this report are given in good faith but in the preparation of this report, we have relied in part on information provided by the directors and management of Corvette and Cape Lambert.
• Information we have received includes, but is not limited to: $12.2$
• Discussions with management and directors of Corvette;
• Details of historical market trading of Corvette and Cape Lambert ordinary shares as $\bullet$ recorded by ASX to 7 August 2009;
• Shareholding details of Corvette and Cape Lambert as supplied by the companies share registrars and the directors;
• Audited annual reports of Corvette and Cape Lambert for the years ended 30 June 2008 and 30 June 2007;
• Reviewed half year reports of Corvette and Cape Lambert for the half year ended 31 December 2008:
• ASX Announcements of Corvette and Cape Lambert for the period from 1 January 2009 to 17 August 2009,
• Bidders Statement dated 24 July 2009 produced by Cape Lambert relating to the Takeover for Corvette;
• Draft unaudited financial statements prepared by Corvette management as at 30 June 2009.
• The Valuation Report on the mineral assets of Corvette prepared by Ravensgate Pty Ltd and discussions with Richard Hyde, the author of the Ravensgate Valuation Report: and
• Drafts of the Target Statement prepared by Corvette and its legal advisers in July and August 2009 (last draft 18 August 2009).
• Our report includes Appendices A and B (the Ravensgate Valuation Report) attached to 12.3 this report as well as our Financial Services Guide.

Yours faithfully STANTONS INTERNATIONAL SECURITIES

John P Van Dieren Director

Stantons International Pty Ltd trading as

LEVEL 1. 1 HAVELOCK STREET WEST PERTH VVA 6005, AUSTRALIA PH: 61 8 9481 3188 . FAX: 61 8 9321 1204 www.stantons.com.au

APPENDIX A

AUTHOR INDEPENDENCE AND INDEMNITY

This annexure forms part of and should be read in conjunction with the report of Stantons International Securities dated 18 August 2009, relating to the proposed Takeover Offer by Cape Lambert to receive 0.417 of a Cape Lambert share for every 1 Corvette Ordinary Share held on the Record Date as stated in the Bidder's Statement date 24 July 2009.

At the date of this report, Stantons International Securities does not have any interest in the outcome of the proposals. There are no relationships with Corvette other than acting as an independent expert for the purposes of this report. There are no existing relationships between Stantons International Securities and the parties participating in the transaction detailed in this report which would affect our ability to provide an independent opinion. The fee to be received for the preparation of this report is based on the time spent at normal professional rates plus out of pocket expenses and is estimated not to exceed \$28,000. The fee is payable regardless of the outcome. With the exception of that fee, neither Stantons International Securities nor John P Van Dieren have received, nor will or may they receive any pecuniary or other benefits, whether directly or indirectly for or in connection with the making of this report.

Stantons International Securities (a trading division of Stantons International Pty Ltd) or Stantons International Services Pty Ltd an associated entity or any directors of Stantons International Pty Ltd and Stantons International Services Pty Ltd do not hold any securities in Corvette. There are no pecuniary or other interests of Stantons International Securities that could be reasonably argued as affecting its ability to give an unbiased and independent opinion in relation to the proposal. Stantons International Securities and Mr J Van Dieren have consented to the inclusion of this report in the form and context in which it is included as an annexure to the Notice.

QUALIFICATIONS

We advise Stantons International Pty Ltd is the holder of an Investment Advisers Licence (No 319600) under the Corporations Act 2001 relating to advice and reporting on mergers, takeovers and acquisitions involving securities. A number of the directors of Stantons International Pty Ltd are the Directors of Stantons International Services Pty Ltd a related entity. Stantons International Pty Ltd and Stantons International Services Pty Ltd have extensive experience in providing advice pertaining to mergers, acquisitions and strategic for both listed and unlisted companies and businesses.

Mr John P Van Dieren FCA, the person responsible for the preparation of this report, has extensive experience in the preparation of valuations for companies and in advising corporations on takeovers generally and in particular on the valuation and financial aspects thereof, including the fairness and reasonableness of the consideration offered.

The professionals employed in the research, analysis and evaluation leading to the formulation of opinions contained in this report, have qualifications and experience appropriate to the task they have performed.

DECLARATION

This report has been prepared at the request of the independent Directors of Corvette in order to assist the shareholders of Corvette to assess the merits of the Takeover Offer to which this report relates. This report has been prepared for the benefit of Corvette and those persons only who are entitled to receive a copy for the purposes of Section 640 of the Corporations Act and does not provide a general expression of Stantons International Securities opinion as to the longer term value of Corvette and its subsidiaries and assets. Stantons International Securities does not imply, and it should not be construed, that is has carried out any form of audit on the accounting or other records of Corvette or its subsidiaries, businesses, other assets and liabilities. Neither the whole, nor any part of this report, nor any reference thereto may be included in or with or attached to any document, circular, resolution, letter or statement, without the prior written consent of Stantons International Securities to the form and context in which it appears.

DISCLAIMER

This report has been prepared by Stantons International Securities with care and diligence. However, except for those responsibilities which by law cannot be excluded, no responsibility arising in any way whatsoever for errors or omission (including responsibility to any person for negligence) is assumed by Stantons International Securities and Stantons International Services Pty Ltd, its directors, employees or consultants for the preparation of this report.

DECLARATION AND INDEMNITY

Recognising that Stantons International Securities may rely on information provided by Corvette and its officers (save whether it would not be reasonable to rely on the information having regard to Stantons International Securities experience and qualifications), Corvette has agreed:

• to make no claim by it or its officers against Stantons International Securities to $(a)$ recover any loss or damage which Corvette may suffer as a result of reasonable reliance by Stantons International Securities on the information provided by Corvette; and
• $(b)$ to indemnify Stantons International against any claim arising (wholly or in part) from Corvette or any of its officers providing Stantons International Securities any false or misleading information or in the failure of Corvette or its officers in providing material information, except where the claim has arisen as a result of wilful misconduct or negligence by Stantons International Securities.

A draft of this report was presented to Corvette Directors for a review of factual information contained in the report. Comments received relating to factual matters were taken into account, however the valuation methodologies and conclusions did not alter.

Stantons International Pty Ltd trading as

AFS Licence No. 319600

LEVEL 1. 1 HAVELOCK STREET WEST PERTH VVA 6005, AUSTRAIJA PH: 61 8 9481 3188 . FAX: 61 8 9321 1204 www.stantons.com.air

FINANCIAL SERVICES GUIDE FOR STANTONS INTERNATIONAL SECURITIES DATED 18 AUGUST 2009

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APPENDIX B

RAVENSGATE PTY LTD TECHNICAL VALUATION REPORT ON THE CORVETTE MINERAL ASSETS

INDEPENDENT VALUATION REPORT

CORVETTE RESOURCES LIMITED

for

STANTONS INTERNATIONAL PTY LTD (TRADING AS STANTONS INTERNATIONAL SECURITIES)

INDEPENDENT VALUATION REPORT

CORVETTE RESOURCES LIMITED

for

STANTONS INTERNATIONAL PTY LTD (TRADING AS STANTONS INTERNATIONAL SECURITIES)

RAVENSGATE

10 August 2009

Corvidae Pty Ltd as Trustee for Ravensgate Unit Trust Trading as Ravensgate 49 Ord Street West Perth, Western Australia 6005 PO Box 1923, West Perth WA 6872 Tel +61 08 9226 3606 Fax +61 08 9226 3607 email: infoatravensgate.com.au web: http://www.ravensgate.com.au

ABN: 92 492 598 860

INDEPENDENT TECHNICAL VALUATION

Prepared by RAVENSGATE on behalf of:

CORVETTE RESOURCES LIMITED and STANTONS INTERNATIONAL SECURITIES

Author(s):	Richard Hyde	Associate Consulting Geologist	BSc (Geology & Geophysics), MAusIMM
	H. Kate Holdsworth	Senior GIS Geologist	BSC (Hons), MAusIMM
Reviewer	Stephen Hyland	Principal Consultant - Director	BSc Geology, MAusIMM, CIMM, GAA
Date:	10 August 2009
Copies:	Corvette Resources Limited	(2)
	Ravensgate

$\mathcal{R}$ llyds

Richard Hyde For and on behalf of: RAVENSGATE

This document has been prepared for the exclusive use of Stantons International Pty Ltd (trading as Stantons International Securities) and the information contained within it is based on based of instructions, information and data supplied by them. No warranty or guarantee, whether expressed or implied, is made by Ravensgate with respect to the completeness or accuracy of this document and no party, other than the client, is authorised to or should place any reliance whatsoever on the whole or any part or parts of the document. Ravensgate does not undertake or accept any responsibility or liability in any way whatsoever to any person or entity in respect of the whole or any part or parts of this document, or any errors in or omissions from it, whether arising from negligence or any other basis in law whatsoever.

TABLE OF CONTENTS

1.			EXECUTIVE SUMMARY
2.			INTRODUCTION
	2.1		Terms of Reference
	2.2		Qualifications, Experience and Independence
	2.3		Principal Sources of Information
	2,4		Background Information
3.			CORVETTE RESOURCES LIMITED'S PROJECTS
	3.1		Plumridge Project
		3.1.1	Introduction
		3.1.2	Tenure
		3.1.3	Geology and Mineralisation
		3.1.4	Exploration History
		3.1.5	Geological Model
		3.1.6	Exploration Potential
	3.2		Murray Basin Projects
		3.2.1	Introduction
		3.2.2	Tenure
		3.2.3	Geology and Mineralisation
		3.2.4	Exploration History
		3.2.5	Metallurgical Testwork
		3.2.6	Mineral Resources
		3.2.7	Exploration and Resource Potential
	3.3		Otway Project
		3.3.1	Introduction
		3.3.2	Tenure
		3, 3, 3	Geology and Mineralisation
		3.3.4	Exploration History
		3.3.5	Exploration and Resource Potential
	3.4		Inkerman Project
		3.4.1	Introduction
		3.4.2	Tenure
		3.4.3	Geology and Mineralisation
		3.4.4	Exploration History
		3.4.5	Exploration Potential
4.	VALUATION
	4.1		Introduction
	4.2		Previous Valuations
	4.3		Comparable Transactions
	4.4		Plumridge Project

	4.5	Murray Basin Projects
	4.6	Otway Project
	4.7	Inkerman Project
	4.8	Material Agreements
	4.9	Valuation Summary
$5 -$		REFERENCES
		6. GLOSSARY

LIST OF TABLES

Table 1 Murray Basin Projects Resource Estimate 3%THM Cut-off …………………………………………………7
Table 2 Corvette Resources Limited Mineral Assets Technical Valuation Summary 8
Table 3 Avonbank deposit Aircore Drilling Results
Table 4 Cannie West - Comparison of CRAE and Corvette drilling
Table 5 Wedderburn Project - Zircon Concentrate Chemistry
Table 6 Murray Basin Projects - Resource Estimate, 3%THM Cut-off
Table 7 Inkerman Project - Composite Samples Urquart Point
Table 8 Inkerman Project - Reconnaissance Samples Western Cape York Peninsula 30
Table 9 Recent Market Transactions - Western Australian Exploration Gold Projects 32
Table 10 Corvette Resources Limited - Mineral Assets Technical Valuation Summary 35

LIST OF FIGURES

Figure 1 Project Locations
Figure 2 Plumridge Project - Location Plan
Figure 3 Plumridge Project - RC drilling (December 2008)
Figure 4 Challenger Deposit - Mineralisation Model
Figure 5 Tropicana Deposit - Early Interpretive section
Figure 6 Murray Basin Projects - Location Plan
Figure 7 Avonbank Project - Exploration Summary Plan
Figure 8 Cannie West Project - Exploration Summary Plan
Figure 9 Wedderburn Project - Exploration Summary Plan
Figure 10 Otway Project - Location Plan
Figure 11 Inkerman Project - Location Plan

LIST OF APPENDICES

APPENDIX 1
Corvette Resources Limited Tenement Details

$\mathbf{1}$ . EXECUTIVE SUMMARY

Ravensgate has been commissioned by Stantons International Pty Ltd (trading as Stantons International Securities) (Stantons) to provide an Independent Technical Valuation of the mineral assets belonging to Corvette Resources Limited (Corvette) to assist in the drafting of an Independent Experts Report (IER) in relation to a proposed takeover offer of Corvette by Cape Lambert Iron Ore Ltd.

Corvette is primarily a gold and mineral sands exploration company listed on the Australian Securities Exchange (ASX). Corvette has some 10,300km² of permits under licence which comprise the Plumridge, Murray Basin, Otway and Inkerman projects, variously located in Western Australia, Victoria and Queensland.

The Plumridge Project is located approximately 250km east-northeast of Kalgoorlie, and comprises 12 exploration licences which are wholly owned by Corvette. The project covers an area of 2,302 km². Major gold occurrences in the region include the Tropicana and Havana deposits which are located some 50km northeast of the Plumridge Project. At Tropicana and Havana gold mineralisation is situated beneath a veneer of transported material and is hosted in sheared and altered granitic, granodioritic and dioritic rocks. Other host rocks have also been identified and these include hydrothermally altered biotite-sericite with 5% to 10% disseminated pyrite in banded feldspathic and garnet-bearing gneiss of possible Proterozoic age. The current resource for the Tropicana Gold Project includes Measured, Indicated and Inferred Resources totalling some 75.3Mt grading 2.07g/t and containing 5.01Moz of gold. Corvette has undertaken a number of exploration programs over the Plumridge project area since 2006 including calcrete geochemical sampling, aircore and RC drilling targeting supergene and bedrock gold anomalism. Drilling has resulted in the discovery of several new zones at the Corvette Prospect and has delineated a mineralised system over considerable strike extent, with bedrock gold intercepts exceeding 1g/t gold over 8km in strike, and anomalies from aircore drilling extending over 12km. Best results from recent drilling include:-

• Hole CVRC 58 intersected 10 metres at 8.3 g/t Au from 119 metres, including 8 metres at 10 g/t Au from 119 metres.
• Hole CVRC 56 intersected 2 metres at 2.1 g/t Au from 104 metres, 3 metres at 5.5 g/t Au from 110 metres, and 2 metres at 3.5 g/t Au from 115 metres.
• Hole CVRC 59 intersected 2 metres at 2.4 g/t Au from 80 metres.
• Hole CVRC 60 intersected 3 metres at 4.7 g/t Au from 52 metres, including 1 metre at 12.2 g/t Au from 54 metres.
• Hole CVRC 61 intersected 4 metres at 1.6 g/t Au from 68 metres, and 4 metres at 2.5 g/t Au from 144 metres.
• Hole CVRC 62 intersected 4 metres at 1.4 g/t Au from 40 metres and 8 metres at 2.9 g/t Au from 80 metres, including 4 metres at 5.0 g/t Au from 80 metres.

Recent RC drilling indicates that gold mineralisation is associated with zones of intense deformation as well as sites of partial melting of host gneiss. Mineralisation is structurally controlled and located in dilational zones. This mineralisation model is analogous to the Challenger Deposit in South Australia where gold mineralisation is also structurally controlled. Similarly, gold mineralisation at the Tropicana Gold Project occurs as tabular shoots with a strong correlation between grade and thickness indicating gold mineralisation is associated with structurally controlled dilational zones. Ravensgate considers the Corvette Prospect at Plumridge displays many similarities with the Challenger Deposit and Tropicana Gold Project at a similar stage of development.

The Murray Basin Projects are situated in northwest and west Victoria comprising five exploration licences and one exploration licence application. The total area of these licences is 1.395km². Heavy Mineral Sand (HMS) deposits in the Murray Basin are of two principle types namely Strand style deposits and WIM-style deposits. Strand style deposits form as a result of the concentration and winnowing in the fore beach area of ancient shorelines and are characterised by coarse sand and gravel lenses that are approximately 100 to 500m wide and from 2 to 12m thick. The WIM-style deposits are fine grained sheet like deposits covering a fairly large area that probably formed as a result of deposition below the wave base in a near shore environment. The Wedderburn, Graybridge, Avonbank and Kalkee projects host large WIM-style HMS deposits that have attractive grades, low potential strip ratios, and high in-situ Corvette's Avonbank-Kalkee, Graybridge and Wedderburn projects host zircon contents. Inferred and Indicated Resources which have been classified according to the Australasian Code for Reporting of Identified Mineral Resources and Ore Reserves published by the Joint Ore Reserves Committee (JORC) in December 2004. The Mineral Resources associated with the projects are tabled below.

	Table 1						Murray Basin Projects Resource Estimate 3%THM Cut-off
		Inferred Resource			Indicated Resource			Total Resource
Project	Tonnage (Mt)	THM x	Zircon ж	Tonnage (Mt)	THM %	Zircon %*	Tonnage (Mt)	THM X	Zircon %"
Avonbank/Kalkee	160.9	5.1	15.7	199.4	6.4	15.8	360.3	5.8	15.8
Graybridge	47.6	3.4	15.2	٠	$\bullet$		47.6	3.4	15.2
Wedderburn	141.1	4.3	13.5	32.0	4.8	18.6	173.2	4.4	14.4
Total	349.6	4.6	14.7	231.4	6.2	16.2	581.1	5.2	15.3

Note: zircon content expressed as a percentage of THM

The Murray Basin WIM-style deposits have potential to be developed into producing mines with combined resources sufficient to sustain mining operations for a significant period of time, providing the recovery and metallurgical challenges can be resolved. In addition, there is considerable potential to discover further strand-style HMS deposits within Corvette's extensive holding in the Murray Basin.

The Otway Project is located in Victoria, inland from Port Campbell and consists of one granted licence covering an area of 2,937km². The project covers an onshore portion of the Otway Basin where unconsolidated Tertiary sediments unconformably overlie the northern and western flanks of uplifted Cretaceous rocks of the Otway Ranges. The Hanson Sand, which occurs in the project area, is considered to be a stratigraphic equivalent unit of the Loxton-Parilla Sand in the Murray Basin which is known to host a number of heavy mineral deposits. The Otway Project has undergone limited exploration however investigations by Corvette indicate that HM occurs in the project area.

The Inkerman Project covers approximately 400km of beach and near-shore strandlines developed along the eastern shore of the Gulf of Carpentaria. Significant HM concentrations (with high zircon and rutile contents) have been recorded at Urquhart Point near Weipa to the north of the Inkerman Project. Previous exploration in the region for mineral sands has generally been carried out on a reconnaissance scale only, but has revealed a number of HM occurrences along the current coastal zone of the Gulf of Carpentaria. While only limited work has been completed previously in the area encompassing the current Inkerman Project, significant results have been returned which warrant follow-up investigation.

All monetary values included in this report are expressed in Australian dollars (A\$) unless otherwise stated. Corvette's mineral assets can be classified as Exploration Areas. In valuing the exploration potential associated with the projects, Ravensgate has elected to apply the Multiples of Exploration Expenditure (MEE) and Comparative Transaction methods. A summary

of the Corvette mineral asset valuations is provided in the table below. These valuations reflect Corvette's deemed equity interest in the various mineral assets. The applicable valuation date is 10^th August 2009.

	Table 2 Corvette Resources Limited Mineral Assets Technical Valuation Summary
Valuation Corvette
Project	Asset	Equity Interest	Low \$M	High SM.	Preferred SM
Plumridge	Exploration Potential	100%	5.57	27.6	18.4
Murray Basin	Exploration Potential & Mineral Resources	100%	1.79	3.58	2.68
Otway	Exploration Potential	100%	0.10	0.10	0.10
Inkerman	Exploration Potential	100%	0.10	0.10	0.10
Total*			7.36	31.2	21.1

* Note: Totals may not add up due to rounding error

The value of Corvette Resources Limited's equity interest in the various mineral assets is considered to lie in a range from \$7.36M to \$31.2M, within which range we have selected a preferred value of \$21.1M.

$2.$ INTRODUCTION

$2.1$ Terms of Reference

Ravensgate has been commissioned by Stantons International Pty Ltd, trading as Stantons International Securities, (Stantons) to provide an Independent Technical Valuation of the mineral assets belonging to Corvette Resources Limited (Corvette) to assist in the drafting of an Independent Experts Report (IER) in relation to a proposed takeover offer for Corvette by Cape Lambert Iron Ore Ltd.

The work has been commissioned by Stantons with the full support of Corvette. This report does not provide a valuation of Corvette as a whole, nor does it make any comment on the fairness and reasonableness of any aspect of the proposed takeover by Cape Lambert Iron Ltd.

The conclusions expressed in this Independent Technical Valuation are valid as at the Valuation Date (10 August 2009). The valuation is therefore only valid for this date and may change with time in response to changes in economic, market, legal or political factors, in addition to ongoing exploration results. All monetary values included in this report are expressed in Australian dollars (AUD) unless otherwise stated.

This report has been prepared in accordance with the Code and Guidelines for Assessment and Valuation of Mineral Assets and Mineral Securities for Independent Expert Reports (The Valmin Code) as adopted by the Australasian Institute of Mining and Metallurgy (AuslMM) in April 2005.

The Independent Technical Valuation report has been compiled based on information available up to and including the date of this report. Consent has been given for the distribution of this report in the form and context in which it appears.

$2.2$ Qualifications, Experience and Independence

Ravensgate was established in 1997 and specialises in resource modelling and resource estimation services. The company has worked for major clients globally, such as Freeport at Grasberg Mine, Ok Tedi Gold Mine in Papua New Guinea, AngloGold Ashanti in Ghana and many junior resource companies which are ASX (Australian Stock Exchange), TSX (Toronto Stock Exchange) or AIM (London Stock Exchange) listed. Ravensgate has focused upon providing resource estimations, valuations, independent technical documentation, and has been involved in the preparation of Independent Reports for Canadian, Australian and United Kingdom companies.

Primary author: Richard Hyde, BSc Geology and Geophysics, Member of Australasian Institute of Mining and Metallurgy

Associate Consultant

Mr Richard Hyde, is a geologist with more than 14 years experience in the minerals industry including over 5 years experience operating in West Africa. Richard has worked in a number of different geological environments in Australia, Africa and Eastern Europe. He has managed large exploration projects and worked extensively within the minerals industry as a consulting geologist.

Co-author: H. Kate Holdsworth, BSc (Hons) Geology, Member of Australasian Institute of Mining and Metallurgy

Senior GIS Geologist

Mrs H. Kate Holdsworth is a GIS geologist with over 14 years GIS experience who joined Ravensgate in September 2006. Since then she has researched and co-authored a number of Independent Geologists Reports, compiled various maps as well as assisted clients with their exploration reporting requirements. Kate has also undertaken QA/QC investigations into client's data quality. Before joining Ravensgate, Kate worked for Giscoe Pty Ltd, a GIS company in Johannesburg, for ten years, where she was involved in diverse GIS projects, including database generation, database population analysis and statistics and data validation. Kate has four years

experience in GIS with the Geological Survey of South Africa, where she was a member of their GIS database design team.

Peer Reviewer: Stephen Hyland - BSc Geology, Member of Australasian Institute of Mining and Metallurgy, CIMM and GAA.

Principal Consultant

Stephen Hyland has had extensive experience of over 20 years in exploration geology and resource modelling and has worked extensively within Australia as well as offshore in Africa, Eastern and Western Europe, Central and South East Asia, modelling base metals, gold, precious metals and industrial minerals. Stephen Hyland's extensive resource modelling experience commenced whilst working with Eagle Mining Corporation NL in the diverse and complex Yandal Gold Province where for three and half years he was their Principal Resource Geologist. Whilst the majority of his time there had been developing the historically successful Nimary Mine, he also assisted the regional exploration group with preliminary resource assessment of Eagle's numerous exploration and mining leases. Since 1997 Stephen Hyland has been a full time Consultant with the minerals consulting firm Ravensgate where he is responsible for all geological modelling and reviews, mineral deposit evaluation, computational modelling, resource estimation, resource reporting for ASX / JORC and other regulatory compliance areas. Primarily Stephen Hyland specialises in Geological and Resource Block Modelling generally with the widely used Medsystem / MineSight 3D mine-evaluation and design software. Stephen Hyland holds the relevant qualifications and professional associations required by the ASX, JORC and ValMin Codes in Australia. He is a Qualified Person under the rules of the CIMM and NI43-101.

Principal Sources of Information $2.3$

The principal sources of information used to compile this report comprise technical reports and data variously compiled by Corvette and their consultants, and discussions with Corvette technical and corporate management. A listing of the principal sources of information is included in the full technical reports for Corvette.

A site visit was undertaken by the primary author in December 2008 to the Plumridge Project. No site visits were undertaken to the remaining Corvette exploration projects as they are generally at an early stage of development. While Corvette's group of mineral assets include Inferred Resources, Ravensgate is of the opinion that no significant additional benefit would have been gained through site visits.

All reasonable enguiries have been made to confirm the authenticity and completeness of the technical data upon which this report is based. A final draft of this report was also provided to Corvette, along with a request to identify any material errors or omissions prior to final submission.

$2.4$ Background Information

Corvette has a number of projects throughout Australia that are prospective for gold and heavy mineral sands (Figure 1). Tenement details are presented in Appendix 1.

Figure 1 Project Locations

$3.$ CORVETTE RESOURCES LIMITED'S PROJECTS

$3.1$ Plumridge Project

Introduction $3.1.1$

The Plumridge project is located approximately 250km east-northeast of Kalgoorlie (Figure 2). Access to the southern boundary of the project is via an unsealed road for approximately 280km east from Kalgoorlie along the Trans Australian Railway then north for approximately 80km along the unsealed Cable Haul Road.

Corvette is the recipient of a \$140,000 grant from the Western Australian Government (June 2009). Under the proposed programme this will be used towards diamond drilling targeting gold mineralisation at the Corvette Prospect. It also has a collaborative research program with CSIRO to investigate the mineral systems at Plumridge, using leading edge technology to analyse drill samples from Corvette's recent drilling programs. This will facilitate a more detailed understanding of the mineralisation and structural controls of gold mineralisation at the prospect.

$3.1.2$ Tenure

The Plumridge Project comprises 12 exploration licences which are wholly owned by Corvette. The permits cover an area of 2,302 km². The northern six tenements are prefixed with "39" and are located in the Mt Margaret mineral field. The southern six tenements are prefixed with "28" and are located within the North East Coolgardie mineral field.

Geology and Mineralisation $3.1.3$

The surface of the project area is mostly covered by red-brown aeolian sand, overlying a calcrete surface. In places the calcrete surface is exposed. The youngest geological units in the area are the widespread aeolian dunes and intervening alluvial and colluvial deposits underlain by a sequence of flat lying Tertiary-age sediments of the Eucla Basin.

The Tertiary sediments are a thin (<1km), widespread, platform sequence. These sediments are unconformably underlain by Mesozoic and Palaeozoic sediments which are unconformably underlain by crystalline Proterozoic rock extending along the southern and south-eastern margin of the Yilgarn Craton. These rocks underwent deformation during the Albany-Fraser Orogeny and are characterised by mafic and felsic gneisses and granites produced by the collision of the Yilgarn and the East Antarctic Cratons between 1345 and 1100Ma. The orogen has been subdivided into the Nornalup and the Biranup Complexes. The Biranup Complex forms the northern section of the orogen and units from this complex occur within the Plumridge Project. The Biranup Complex is comprised of deformed, mafic granulites, quartzo-feldspathic gneisses and granitic gneisses.

The major gold occurrences in the region include the Tropicana and Havana deposits which are located on the south eastern margin of the Yilgarn Craton approximately 340km northeast of Kalgoorlie, and some 50km north of Corvette's Plumridge Project. At Tropicana and Havana the gold mineralisation is located beneath a veneer of transported material ranging in thickness from 5m to 20m. Gold mineralisation is hosted in sheared and altered granitic, granodioritic and dioritic rocks. Other host rocks have also been identified and these include hydrothermally altered biotite-sericite with 5% to 10% disseminated pyrite in banded feldspathic and garnetbearing gneiss of possible Proterozoic age.

Figure 2 Plumridge Project - Location Plan

Exploration History $3.1.4$

The region encompassing the Plumridge Project was explored for gold by Western Mining Corporation (WMC) from 1981. WMC completed regional geochemical sampling along the western margin of the Eucla Basin. Samples were analysed for gold during 1995-96 from which seven gold anomalies ranging in value from 3ppb to 236ppb were identified extending over a 60km strike length. This area was later explored by the AngloGold-Ashanti - Independence JV which resulted in the discovery of the Tropicana Gold Project. In 2002 AngloGold Ashanti drilled a 7km long gold in soil anomaly returning results of 9m at 1.04g/t Au and 4m at 1.34g/t Au from holes located 2km apart. From 2003 to 2005 additional drilling returned significant results including 42m at 3.3g/t Au and 32m at 6.6g/t Au. In November 2006 Independence released the results of a new prospect at Beachcomber situated 220km southwest of the Tropicana area, significant results included an intersection of 4m at 43.5g/t Au from 24m. In December 2007 the Joint Venture announced an initial resource estimate for the project, with an update following in January 2009. The current resource for the TGP includes Measured,

Indicated and Inferred Resources totalling some 75.3Mt grading 2.07g/t and containing 5.01Moz of gold.

Two exploration programmes have been carried out by Corvette, the first carried out on the three eastern tenements (E28/1556-8) for mineral sands in Tertiary sediments. The second programme was carried out on Corvette's remaining nine tenements prospective for gold and base metal mineralisation. This included a widespread calcrete sampling campaign for gold. Heavy mineral anomalies were located and followed up with drilling however following the significant gold results from aircore drilling and the development of the Tropicana Gold Project Corvette has focussed exploration on gold at the Plumridge.

Corvette completed aircore drilling targeting supergene and bedrock gold anomalism in 2008. This program resulted in the discovery of several new zones on tenement E39/1118, which were later named the Corvette Prospect. The Corvette Prospect was tested by subsequent reverse circulation drilling and in late 2008 a low-level airborne magnetic/radiometric survey was flown over the prospect area. A further campaign of aircore and RC drilling was undertaken in the first half of 2009. Follow-up RC drilling confirmed the presence of significant bedrock mineralisation. The system has considerable strike extent with bedrock gold intercepts exceeding 1g/t gold over 8km in strike, and anomalies from aircore drilling extending over 12km. Best results to date have been returned from the Stingray Zone at the Corvette Prospect which are summarised below in Figure 3 and listed below.

Significant results at Stingray are shown below:

Screen fire Assays

• Hole CVRC 58 intersected 10 metres at 8.3 g/t Au from 119 metres, including 8 metres at 10 g/t Au from 119 metres.
• Hole CVRC 56 intersected 2 metres at 2.1 g/t Au from 104 metres, 3 metres at 5.5 g/t Au from 110 metres, and 2 metres at 3.5 g/t Au from 115 metres.
• Hole CVRC 59 intersected 2 metres at 2.4 g/t Au from 80 metres.
• Hole CVRC 60 intersected 3 metres at 4.7 g/t Au from 52 metres, including 1 metre at 12.2 g/t Au from 54 metres.

Four-metre Composite Assays (splits pending at time of reporting)

• Hole CVRC 61 intersected 4 metres at 1.6 g/t Au from 68 metres, and 4 metres at 2.5 g/t Au from 144 metres
• Hole CVRC 62 intersected 4 metres at 1.4 g/t Au from 40 metres and 8 metres at 2.9 g/t Au from 80 metres, including 4 metres at 5.0 g/t Au from 80 metres.

Figure 3 Plumridge Project - RC drilling (December 2008)

Exploration for other commodities includes uranium exploration which was undertaken throughout the region during the 1970s by Magnet Metals Ltd, and coal exploration which was undertaken by Griffin Coal Mining Company during the 1980s.

$3.1.5$ Geological Model

Both supergene and primary gold mineralisation has been intersected at the Corvette Prospect in air core holes extending over 9km in length and forming two sub-parallel zones. These zones have been interpreted as major zones of shearing and deformation. RC drilling indicates that gold mineralisation is associated with zones of intense deformation as well as sites of partial melting of host gneiss. Mineralisation is structurally controlled and located in dilational zones. This model is analogous to the Challenger Mine in South Australia where gold mineralisation is also structurally controlled. Similarly gold mineralisation at the Tropicana Gold Project occurs as tabular shoots with a strong correlation between grade and thickness indicating gold mineralisation is associated with structurally controlled dilational zones. A three dimensional model for Challenger and is shown below in Figure 4, while an early stage cross-section from the Tropicana Project, displaying similarities to the Corvette Prospect is presented below as Figure 5.

Figure 5 Tropicana Deposit - Early Interpretive section

Exploration Potential $3.1.6$

The Eucla Basin has undergone limited gold exploration, which is likely due to the subtle surface anomalism representing mineralisation at depth. Significant discoveries have been made from within relatively low level (5 to 10ppb Au) gold in soil anomalies. The discovery and development of the Tropicana Gold Project and more recent discoveries by Corvette at Plumridge highlights the significant prospectivity of the region. Corvette's surface calcrete sampling and drilling have identified several zones of gold mineralisation that require follow up exploration. RC drilling results from the Stingray Zone, shown in Figure 3, underscore the gold potential for the project.

The project area is still considered prospective for heavy mineral sands however Corvette has focussed recent efforts on gold exploration. The area is also prospective for lignite, roll front uranium style mineralisation as well as base metals with the Mulga Rocks multi commodity deposit located 55km to the west of the Plumridge Project. The basin is relatively unexplored for these commodities.

$3.2$ Murray Basin Projects

$3.2.1$ Introduction

Corvette's Murray Basin Projects are situated in northwest and west Victoria (Figure 6). An existing network of highways and sealed secondary roads facilitates access to the projects. The projects are located mostly in relatively flat, cleared, freehold agricultural land utilised
predominantly for crop cultivation. The region has a Mediterranean to temperate climate typified by cool wet winters and warm to hot dry summers.

Figure 6 Murray Basin Projects - Location Plan

$3.2.2$ Tenure

Corvette's five Murray Basin projects comprise five exploration licences and one exploration licence application. The total area of these licences is 1,395km². The tenements are 100% owned by Corvette.

$3.2.3$ Geology and Mineralisation

The intra-cratonic Murray Basin covers an area of 300,000km² in northwest Victoria as well as adjacent parts of South Australia and New South Wales.

The basin contains thin flat-lying Cainozoic sediments that unconformably overlie Proterzoic and Palaeozoic basement rocks. These sediments are approximately 600m thick at the deepest central-western part of the basin. The Tertiary succession of sediments was deposited during repeated marine transgressions. The Loxton-Parilla Sand was deposited as a result of the most recent incursion-regression event during Late Miocene to Late Pliocene times. The Loxton-Parilla Sand is characterised by well-sorted sands with minor clays, silts and gravels. The Loxton-Parilla Sand hosts all the significant minerals sands accumulations in the Murray Basin.

Mineral sands deposits in the Murray Basin are of two principle types namely Strand style deposits and WIM-style deposits. Strand style deposits form as a result of the concentration and winnowing in the fore beach area of ancient shorelines and are characterised by coarse sand and gravel lenses that are approximately 100 to 500m wide and from 2 to 12m thick. The WIMstyle deposits are fine grained sheet like deposits covering a fairly large area that probably formed as a result of deposition below the wave base in a near shore environment.

$3.2.4$ Exploration History

Exploration for heavy mineral sands has been undertaken in the Murray Basin since the 1970s. A number of companies namely Prospecting Services Pty Ltd, Westralian Sands, CRAE Exploration (CRAE), Peregrine Resources NL, RZM Pty Ltd in joint venture with Aberfoyle undertook exploration in the basin. CRAE has been one of the main explorers for heavy mineral sands in the basin, they explored chiefly during the 1980s and were the first explorers to find a WIMstyle deposit, the WIM 150 deposit near Horsham, Victoria. They also located other deposits in Victoria notably the WIM 50, 100, 200 and 250 deposits as well as the Jack's Tank deposit in NSW. CRAE also noted the presence of Strand-style heavy mineral deposits in north-western Victoria.

Aberfoyle Resources Limited (1986-1991) explored the Murray Basin in South Australia identifying the Mindarie and Perponda strand-style deposits. Peregrine Resources NL (1990-1991) discovered the Massidon deposit similar in style to WIM deposits in southwest NSW.

Avonbank and Kalkee

Regional reconnaissance drilling carried out by CRAE Pty Ltd from 1987-1992, delineated the 42 km2 Avonbank WIM-style deposit. The DNRE (currently the Department of Primary Industries) in 2000, reported an Indicated and Inferred resource comprising 705Mt at 5.31%HM for the Avonbank deposit.

On acquiring tenements EL4955 and EL5016 Corvette appointed Snowden Mining Industry Consultants (Snowdens) to update the existing resource estimate to a total (Indicated and Inferred Resource) of 360.3 Mt at 5.8% THM (Total Heavy Minerals) at a 3% THM cut-off grade. The deposit lies underneath unmineralised sediments with an average thickness of 18m (Figure 7).

Corvette carried out two aircore drilling programmes on the Avonbank deposit which confirmed the results obtained by CRAE (Table 3).

Hole	Interval(m)	From(m)	To(m)	Average %HM ( > 2.96 SG)
AVAC001	$\overline{7}$	16	23	4, 4
AVAC002	3	24	27	8.5
AVAC003	8	19	27	7.1
AVAC004	9	18	27	3.8
AVAC005	9	18	27	5.3
AVAC006	14	16	30	4.6
AVAC011	$\overline{7}$	19	26	5.2
AVAC012	11	16	27	3.9
AVAC013	9	18	27	5.1
AVAC014	9	18	27	4.4
AVAC015	13	17	30	3.5
AVAC016	14	16	30	2.1
AVAC017	10	17	27	0.8
AVAC018	9	16	27	1.1
AVAC019	9	21	30	2.8
AVAC020	8	17	25	5.8
AVAC021	5	18	23	7.4
AVAC022	11	16	27	6.2
KAL001	10	15	25	3.5
KAL002	11	15	26	5.5
KAL003	9	16	25	5.4
KAL004	9	16	25	3.6
KAL005 KAL006	5 6	14 27	19 33	4.4 3.4

Figure 7 Avonbank Project - Exploration Summary Plan

Cannie West

From 1980-81 Austiex explored the Cannie West tenement. The drilling of three traverses was unsuccessful in locating shallow strandline style deposits and Mineral Sands Limited considered the drilling not deep enough for WIM style deposits.

RGC Exploration conducted regional mineral sands exploration from 1989 to 1992, which covered the current Cannie West project. This resulted in the discovery of low grade strandline deposits. Murray Basin Titanium Ltd verified the presence of the deposits but concluded that they were sub-economic. The 2001-2006 Providence Gold and Minerals exploration of the project area resulted in the location of deeper WIM mineralisation.

Figure 8 Cannie West Project - Exploration Summary Plan

Corvette's exploration programme has included a drilling programme to verify CRAE's drilling
results, in each comparison the results came back lower than what CRAE reported (Figure 8, Table 4).

						Table 4 Cannie West - Comparison of CRAE and Corvette drilling
CRAE Hole	From (m)	To (m)	Interval (m)	HM% $( > 1mm + 75u)$	HM% $( > 75u + 38u)$	Corvette Ave Grade(>1mm+38u)	Corvette Hole
LL237	16	20	4	0.2	4.9	4.0	cwac014
LL238	13	15	$\mathbf{z}$	0.6	4.2	3.0	cwac004
LL239	27	29	2	0.7	0.4	1.5	cwac006
LL267	17	21	4		3.1	0.9	$c$ wac $012$
LL268	18	21	3		3.2	2.8	cwac008
LL275	23	27	4		3.4	3.1	cwac010
LL317	16	18	$\overline{2}$		4.2	4.1	cwac007
LL355	13	15	$\overline{2}$		4.9	3.7	cwac002
LL372	23	29	6		4.2	2.2	cwac013
LL404	11	13	$\overline{2}$		4.1	2.5	cwac001
LL405	14	27	13		4.7	2.2	cwac003
LL406	12	14	$\overline{2}$		3.7	4.4	cwac005
LL407	22	25	3		3.2	3.2	cwac009
LL408	13	22	9		3.0	3.6	cwac011
LL410	11	13	2		4.3	3.1	cwac015

Graybridge

CRAE (1987 - 1992) established the presence of shallow WIM-style mineralisation. Drilling resulted in the demarcation of a deposit with an area of 8km2. CRAE reported an inferred resource estimate for the area between the Avon River to the south and the Traynors lagoon in the north covering 11.5km2 at 51Mt at 2.8%HM. The average overburden was 6.6m and the ore thickness was 2.7m. CRAE considered the resource to be sub-economic.

Corvette has updated CRAE's resource estimation (section 3.2.6) and from their drilling programme the results of eleven samples analysed show that zircon forms from 19 to 35% of the heavy minerals with Au results obtaining a maximum of 12ppb.

Wedderburn

Woolshed Swamp Quarry was the initial site of HMS observation by Reef Oil NL, they explored the area from 1970-73. From their drilling programme they produced a volume model with grades of HM at 2.2%.

CRAE's 1982-83 regional exploration programme targeted multi-commodities in the Murray Basin. Drilling (up until 1993) demarcated the WIM-style deposit first identified at the Woolshed Swamp quarry. They concluded that the best area, approximately 20km2, of mineralisation was located on Corvette's tenement EL 4912.

Between 1998 to 2000 Golden Triangle Resources NL drilled the area considered to have the best mineralisation.

Corvette's drilling programme over a portion of the Wedderburn deposit, twin drilled some holes to test the CRAE results and some additional holes in areas of little drilling. Work carried out on the samples included heavy media separation and XRF analyses for selected samples. The results returned for the zircon fraction of the heavy mineral content ranged between 1.5% and 58.5%. A resource estimation was undertaken (Section 3.2.6). Metallurgical testwork (Section 3.2.5) was completed with a bulk sample processed to produce a heavy mineral concentrate (HMC) and product separation to produce zircon products.

Figure 9 Wedderburn Project - Exploration Summary Plan

$3.2.5$ Metallurgical Testwork

Wedderburn

Primary Concentration Testwork was undertaken in 2006 with a bulk sample of about 7 tonnes. In 2007 Ammtec processed a portion of the bulk sample in order to create HMC to be further processed into products. Allied Mineral Laboratories processed the remaining 2.3 tonnes of product. The residual material was tromelled and de-slimed to remove the +3mm fraction and -38um fractions respectively.

A heavy mineral concentrate (HMC) was obtained using gravity feed spirals from which 110kg of HMC was recovered. More than 90% of the zircon and more than 70 per cent of the titanium minerals were recovered at this stage. A total of 64% of the zircon was recovered into a concentrate. This represents 7.6% by weight of the feed. The concentrate assayed 22.6% HM. Further processing of the concentrate took place at Titanatek in Queensland. This included magnetic separation and wet tabling to produce a non magnetic concentrate which was further upgraded into a zircon concentrate which assayed at 66.2% (ZrO2 +HfO2). Zircon recoveries were lower than could be anticipated if the Ti rich streams were processed. The zircon has a relatively high U and Th content exceeding 900ppm (Table 5). Further processing could reduce the TiO₂ contents.

	Table 5 Wedderburn Project - Zircon Concentrate Chemistry
Compound	Result
$ZrO2$ (+HfO 2 )	66.20%
TiO 2	0.28%
Al 2 O 3	0.16%
$P_2O_5$	0.23%
Fe 2 O 3	0.05%
$U + Th$	919 ppm
Sizing	$-90, +38$ µm
Zircon recovery	50%

$3.2.6$ Mineral Resources

Mineral Sands Ltd (formerly Corvette) commissioned Snowden Mining Industry Consultants (Snowden) to complete a resource estimate for the Murray Basin projects in July 2006. The estimate was for mineral sands deposits contained within the Avonbank, Graybridge and Wedderburn tenements; this estimate was subsequently updated for the Avonbank- Kalkee tenements by Snowden in May 2007.

Three different analysis techniques have been used in the Murray Basin projects including odd optical (OO), optical (O) and chemical (C). A consistent modelling approach has been applied by Snowden for all models. Block models were created with a block size of 250mE x 250mN x 1mRL for all deposits. Data has been composited on a 1m interval on which statistical and variogram analysis was conducted. Ravensgate concurs with Snowden on the ranges developed from continuity analysis of the variograms. The estimation methodology used for all models was inverse distance cubed (ID3). Estimations were based on 58 drillholes for the Avonbank Project, 56 drillholes for Graybridge and 109 drillholes for Wedderburn.

Snowden reported resources consistent with the guidelines presented in the JORC Code (2004). The reported resources completed by Snowden are summarised in Table 6 below.

							Table 6 Murray Basin Projects - Resource Estimate, 3%THM Cut-off
		Inferred Resource			Indicated Resource			Total Resource
Project	Tonnage (Mt)	THM x	Zircon %	Tonnage (Mt)	THM %	Zircon %*	Tonnage (Mt)	THM %	Zircon %*
Avonbank/Kalkee	160.9	5.1	15.7	199.4	6.4	15.8	360.3	5.8	15.8
Graybridge	47.6	3.4	15.2		۰	$\blacksquare$	47.6	3.4	15.2
Wedderburn	141.1	4.3	13.5	32.0	4.8	18.6	173.2	4.4	14.4
Total	349.6	4.6	14.7	231.4	6.2	16.2	581.1	5.2	15.3

Note: zircon content expressed as a percentage of THM

Exploration and Resource Potential $3.2.7$

Recent technological advances have been made in the field of HMS processing and separation (e.g. electrostatic separators) coupled with favourable prices has augured well for the development of mineral sands deposits in Australia and internationally.

The work completed to date on the Murray Basin projects and Wedderburn WIM- style HM deposits indicate the potential for large deposits, with favourable zircon content. While further testwork is required on the projects results to date indicate future mining of the fine-grained deposits is potentially feasible.

$3.3$ Otway Project

$3.3.1$ Introduction

The Otway Project is located in Victoria, inland from Port Campbell in the south, and up to Mortlake in the north (Figure 10).

Figure 10 Otway Project - Location Plan

$3.3.2$ Tenure

The project consists of one granted licence with an area of 2,937km².

$3.3.3$ Geology and Mineralisation

The project covers an onshore portion of the Otway Basin where unconsolidated Tertiary sediments unconformably overlie the northern and western flanks of uplifted Cretaceous rocks of the Otway Ranges. The Tertiary sediments were deposited during marine transgressions and regressions. They have been uplifted, tilted and have undergone erosion. The Hanson Sand is considered to be a stratigraphic equivalent unit of the Loxton-Parilla Sand in the Murray Basin which is known to host a number of heavy mineral deposits. The Hanson Sand has in places, been preserved by extensive laterisation. Some of the Hanson Sand has been buried by younger volcanics in Western Victoria. The Project area incorporates portions of the strand plain that are not buried by these volcanics.

$3.3.4$ Exploration History

Previous exploration in the project area is limited with work having been completed by Ironbark Mineral Sands Pty Ltd. Their exploration programme totalled six drillholes located on three Hanson Sand capped strand ridges on the raised land between the Gellirand River and Tomahawk Creek. This work returned no significant values.

Corvette has undertaken a desktop study of the project area, as well as a reconnaissance aircore programme. From this programme 20 samples were selected for heavy liquid separations. The results returned ranged from 0.5% to 1.5% THM.

$3.3.5$ Exploration and Resource Potential

The Otway Project has undergone limited exploration from Corvette's reconnaissance programme and subsequent follow up which included the reconnaissance aircore drilling programme of 29 holes for 712m. The results showed that HMS is present in the project area. Further work has been proposed by Corvette.

$3.4$ Inkerman Project

$3.4.1$ Introduction

The Inkerman Project is located in far north Queensland, in the near shore areas of the Cape York Peninsula along the eastern shore of the Gulf of Carpentaria (Figure 11). The southern and central parts of the project can be accessed via Karumba and the northern part of the project can be accessed from Weipa. Throughout the project access is via four wheel drive tracks which are impassable in the wet season. The west season is from December to March as the projects experience a tropical, monsoonal climate.

$3.4.2$ Tenure

The Inkerman Project consists of 14 tenements with an area of 3,793km², five of which have been granted and the remaining nine are under application.

$3.4.3$ Geology and Mineralisation

The geology of the project area is comprised of parallel beach strand ridges separated by mud flats. These ridges are of either Pleistocene or Holocene age and are a direct result of the historic changes in sea level. The Pleistocene ridges are more quartz rich where as the carbon content is lower than the Holocene ridges. It has been noted that there are some Pre-Cambrian basement complexes related to the Mt. Isa Block in addition to Mesozoic sandstone units which has been considered to be the source of heavy mineral concentrations by previous explorers.

Exploration History $3.4.4$

The project area is relatively unexplored with previous exploration been mostly reconnaissance exploration. Some heavy mineral occurrences are known on the coast. The hinterland has undergone minimal exploration mostly targeting sands around river mouths and along rivers. During the period 1957-1960 reconnaissance exploration was undertaken by Enterprise Exploration Pty Ltd and Associated Minerals Consolidated Pty Ltd. During the period 1970-1971 Latec Finance/Alluvial Prospectors and Pacminex Pty Ltd undertook reconnaissance exploration.

To the north of the Inkerman Project in the area explored by Matilda Minerals ltd, significant heavy mineral concentrations have been identified at Urguhart Point near Weipa. Drilling has also been undertaken by Enterprise Exploration Pty Ltd (Enterprise). The coastal zone of the Gulf of Carpentaria has been surface sampled by previous explorers, heavy mineral sands have been noted at all major outlets. Enterprise found low levels of heavy minerals along many of the beaches along the Cape York Peninsula. The composition of the HMC is summarised in Table 7.

	Table 7 Inkerman Project - Composite Samples Urquart Point
Composite	Rutile %	Zircon %	Ilmenite %
А	2.4	8.1	76.6
в	1.5	8.3	72.9
	0.8	13.3	80.5

Figure 11 Inkerman Project - Location Plan

Location	Rutile %	Zircon %	Ilmenite %	% Other
Vrilya Point	7.4	12.7	73.8	6.1
Port Musgrave	11.9	54.7	20.7	12.7
Pennefather River	27.6	14.2	48.9	9.3
Urguhart Point	56	35		9
Pera Head	24	52.9	17.6	5.5
Norman Creek	7.5	14.9	77.6
Topsy Creek	1.3	20.5	74	4.2

Reconnaissance by Enterprise revealed low levels of HM from many beaches of the Western Cape York Peninsula. A summary of the HMC is listed in Table 8 below.

$3.4.5$ Exploration Potential

Exploration potential for the area is highlighted by the low level of exploration and by Matilda Minerals itd as well as Enterprise having established the presence of HMS in the region.

VALUATION 4.

Introduction $4.1$

There are a number of recognised methods used in valuing "mineral assets". The most appropriate application of these various methods depends on several factors, including the level of maturity of the mineral asset, and the quantity and type of information available in relation the asset.

The Valmin Code, which is binding upon "Experts" and "Specialists" involved in the valuation of mineral assets and mineral securities, classifies mineral assets in the following categories:

• Exploration Areas refer to properties where mineralisation may or may not have been identified, but where a mineral resource has not been identified;
• Advanced Exploration Areas and Pre-Development Projects" are those where Mineral Resources have been identified and their extent estimated, but where a positive development decision has not been made;
• Development Projects refers to properties which have been committed to production, but which have not been commissioned or are not operating at design levels;
• Operating Mines are those mineral properties, which have been fully commissioned and are in production.

Various recognised valuation methods are designed to provide the most accurate estimate of the asset value in each of these categories of project maturity. In some instances, a particular mineral property or project may include assets that comprise one or more of these categories.

When valuing Exploration Areas, where the potential is inherently more speculative than more advanced projects, the valuation is largely dependent on the informed, professional opinion of the valuer. There are a number of methods available to the valuer when appraising Exploration Areas.

The Multiple of Exploration Expenditure ("MEE") method can be used to derive project value, when recent exploration expenditure is known or can be reasonably estimated. This method involves applying a premium or discount to the exploration expenditure or Expenditure Base ("EB") through application of a Prospectivity Enhancement Multiplier ("PEM"). This factor directly relates to the success or failure of exploration completed to date, and to an assessment of the future potential of the asset. The method is based on the premise that a "grass roots" project commences with a nominal value that increases with positive exploration results from increasing exploration expenditure. Conversely, where exploration results are consistently negative, exploration expenditure will decrease along with the value.

Where transactions including sales and joint ventures relating to mineral assets that are comparable in terms of location, timing, mineralisation style and commodity, and where the terms of the sale are suitably "arms length" in accordance with the Valmin Code, such transactions may be used as a guide to, or a means of, valuation. This method is considered highly appropriate in the current volatile financial environment where other 'cost based' methods may tend to overstate value.

The Joint Venture Terms valuation method may be used to determine value where a Joint Venture Agreement has been negotiated at 'arms length' between two parties. When calculating the value of an agreement that includes future expenditure, cash and/or shares payments, it is considered appropriate to discount expenditure or future payments by applying a discount rate to the mid-point of the term of the earn-in phase. Discount factors are also applied to each earn-in stage to reflect the degree of confidence that the full expenditure specified to completion of any stage will occur. The value assigned to the second and any subsequent earn-in stages always involves increased risk that each subsequent stage of the agreement will not be completed, from technical, economic and market factors. Therefore, when deriving a technical value using the Joint Venture Terms method, Ravensgate considers it appropriate to only value the first stage of an earn-in Joint Venture Agreement.

The total project value of the initial earn-in period can be estimated by assigning a 100% value. based on the deemed equity of the farminor, as follows:

$$
V_{100} = \frac{100}{D} \left[ CP + \left( CE * \frac{1}{(1+I)^{\frac{t}{2}}} \right) + \left( EE * \frac{1}{\left(1+I\right)^{\frac{t}{2}}} * P \right) \right]
$$

where:

• $V_{100}$ = Value of 100% equity in the project (\$)
• D = Deemed equity of the farminor (%)
• $CP =$ Cash equivalent of initial payments of cash and/or stock (\$)
• CE = Cash equivalent of committed, but future, exploration expenditure and payments of cash and/or stock (\$)
• EE = Uncommitted, notional exploration expenditure proposed in the agreement and/or uncommitted future cash payments (\$)
• = Discount rate (% per annum) $\mathbf{r}$
• $=$ Term of the Stage (years) t.
• = Probability factor between 0 and 1, assigned by the valuer, and reflecting the likelihood that the Stage will proceed to completion.

Where mineral resources remain in the Inferred category, reflecting a lower level of technical confidence, the application of mining parameters is inappropriate and their economic value can therefore not be demonstrated using the more conventional DCF/NPV approach. In these instances it is considered appropriate to use the in situ Resource method of valuation for these assets. This technique involves application of a heavily discounted valuation of the total in-situ metal or commodity contained within the resource. The level of discount applied will vary based on a range of factors including physiography and proximity to infrastructure or processing facilities.

In the case of Pre-development, Development and Mining Projects, where Measured and Indicated Resources have been estimated and mining and processing considerations are known or can be reasonably determined, valuations can be derived with a reasonable degree of confidence by compiling a discounted cash flow (DCF) and determining the net present value (NPV).

Previous Valuations $4.2$

Ravensgate is not aware, nor have we been made aware, of any other valuations of Corvette's mineral assets.

Comparable Transactions $4.3$

Ravensgate has completed a search for recent publicly available market transactions involving gold exploration projects in Western Australia, and specifically within the Albany Frazer Province for gold projects.

The transactions identified relating to gold projects have been specifically selected, reflect sizeable tenement holdings over historic mineral fields in Australia that are considered prospective for mesothermal gold deposits, and that are of similar prospectivity to Corvette's Plumridge Project. The transactions identified along with the implied cash-equivalent values are summarised below in Table 9.

	Table 9 Recent Market Transactions - Western Australian Exploration Gold Projects
Project	Transaction Details	Area (km 2 )	Purchase Price 100% Basis (AS)	Implied Value/km 2 $(A\hat{S})$
Yindi Project	December 2005: Barrick Gold of Australia Ltd entered into a farm-in agreement to earn a 75% interest in Jackson Gold Ltd's 360km 2 Yindi project in the Eastern GoldFields region of WA through exploration expenditure of \$2M over 5 years. Assuming the terms of the JV are met the implied cash equivalent on a 100% equity basis is \$2.66M.	360	S2.66M	\$7,350/km 2
North Telfer Project	November 2005: Placer Dome Australia Ltd entered into an agreement to earn a 70% interest in the 1,100km 2 North Telfer project from NGM Resources Ltd through exploration expenditure of \$2.5M over 5 years. Assuming the terms of the JV are met the implied cash equivalent on a 100% equity basis is \$3.57M.	1,100	\$3.57M	\$3.250/km 2
Prominent Hill Gunbarrel Project	Gunbarrel Project (August 2008): ATW Venture Corp. entered into an agreement to acquire a 90% interest in the 98km 2 Prominent Hill Gunbarrel Project located in the North Eastern goldfields of Western Australia through a series of cash and share issues. Assuming the terms of the agreement are met the implied cash equivalent on a 100% equity basis is \$2.1M.	98	S2.1M	\$21,500/km 2
Rothsay Gold Project	Rothsay Gold Project (September 2007): Silver lake Resources Limited entered into an agreement to acquire a 85% interest in the 25km 2 Rothsay Gold Project located in the Midwest Region, Western Australia through a series of cash and share issues. Assuming the terms of the agreement were met the implied cash equivalent on a 100% equity basis is \$1.1M.	25	S1.1M	\$44.000/km 2
Bronco Plains Project	Bronco Plains Project (August 2008): AngloGold Ashanti Australia Ltd and Independence Gold Ltd entered into a joint agreement to earn a 72% interest with Image Resources Ltd over its Bronco Plains licences located in the Albany Frazer Province. Assuming the terms of the agreement were met the implied cash equivalent on a 100% equity basis is \$2.8M.	230	S2.8M	\$12,100/km 2

	Table 9 Recent Market Transactions - Western Australian Exploration Gold Projects
Utopia Project	Utopia Project (November 2006): Sipa Resources Ltd into a joint agreement to earn a 70% interest with Comet Resources Ltd over its Utopia licences located in the Albany Frazer Province. Assuming the terms of the agreement were met the implied cash equivalent on a 100% equity basis is \$1,8M.	450	S1.8M	\$4,000/km 2
Woodline Project	Woodline Project (December 2006): Sipa Resources Ltd into a joint agreement to earn a 70% interest with Newmont Exploration Pty Ltd over its Woodline gold and base metals licences located in the Albany Frazer Province. Assuming the terms of the agreement were met the implied cash equivalent on a 100% equity basis is \$5,4M.	1165	S5.4M	$54.700$ /km 2
Woodline Project	Woodline Project (December 2006): Sipa Resources Ltd into a joint agreement to earn a 51%% interest with Newmont Exploration Pty Ltd over its Woodline gold and base metals licences located in the Albany Frazer Province. Assuming the terms of the agreement were met the implied cash equivalent on a 100% equity basis is \$4.0M.	620	S4.0M	56,500/km 2

Analysis of these market transactions indicates that gold exploration projects in Australia have a wide range of values depending on prospectivity, development stage and market conditions at the time of the transaction, amongst other factors. Ravensgate has located transactions specific to projects located within the Albany Frazer Province proximal to Corvette's Plumridge Project and the Tropicana Gold Project. Implied values for recent market transactions involving projects located in the Albany Frazer Province range between \$4,000/km² and \$12,000/km², which are generally consistent with transactions for gold projects elsewhere in Western Australia (Table7).

$4.4$ Plumridge Project

The Plumridge Project can be classified as an 'Exploration Area'. In valuing the exploration potential associated with the Plumridge Project, Ravensgate has elected to apply the Multiples of Exploration Expenditure (MEE) and Comparative Transaction methods to derive a range of values for the project.

As far as can be reasonably ascertained, exploration expenditure on the Plumridge Project by Corvette approximates \$5.57M. Most of this exploration expenditure can be directly related to regional and detailed geochemical surveys, airborne geophysical surveys, and aircore and RC drilling. Ravensgate has reasonably elected to assign a range of productivity enhancement multipliers (PEMs) from 1.0 to 3.0, indicating that every dollar spent on regional exploration has returned between \$1.00 and \$3.00 in value. Applying the EB of A\$5.57 million and a range of PEMs from 1.0 to 3.0, Ravensgate derives a range of provisional values for the exploration potential from \$5.57M to \$16.7M.

Ravensgate's analysis of the market transactions summarised in Section 3.3 indicates that the implied value of strategically located gold exploration projects in the Albany Fraser Province of Western Australia generally lies in the range \$4,000/km² to \$12,000/km², which produces a range of values between \$9.2M and \$27.6M for the granted permits comprising the Plumridge Project (2,302km²). This range of values is consistent with similarly prospective exploration project located elsewhere in Western Australia.

Ravensgate has derived a range of provisional values for the Plumridge Project, by applying both the MEE and Comparative Transaction methods, from \$5.57M to \$27.6M, within which we have elected to assign a preferred value of \$18.4M towards the middle to upper end of this range, reflecting the projects excellent exploration potential.

Ravensgate considers that the exploration work completed to date by Corvette is of a high standard and has been effective, resulting in the discovery of a number of prospects and targets. Assessment of the exploration data indicates that numerous significant geological and geochemical targets have been identified and remain to be fully tested.

Ravensgate regards the Plumridge Project as highly prospective for mesothermal gold mineralisation, and considers the project displays many similarities to the Tropicana-Havana and Challenger deposits at similar stages of development. We believe that there is a high likelihood that additional gold discoveries, like those at Stingray, will be made with further work and we consider it likely that with further systematic exploration mineral resources will be defined on the project.

$4.5$ Murray Basin Projects

In valuing the exploration potential associated with the Murray Basin Projects, Ravensgate has elected to apply the Multiple of Exploration Expenditure method. While Inferred and Indicated Mineral Resources have been defined on the projects, Ravensgate considers it inappropriate to apply either the 'In situ Resource' or 'DCF' methods because further testwork is required on the projects to determine mining and processing costs, and to provide further information with respect to potential concentrate specifications.

Much of the exploration expenditure information is not available for the historic exploration database which includes significant work on the Murray Basin projects by CRA Exploration, Aberfoyle and other workers. This work included comprehensive drilling and assay programs completed throughout the 1970's and 1980's. Ravensgate has conservatively calculated a 'replacement cost' of this data at some \$1.20M. As far as can be reasonably ascertained, exploration expenditure on the Murray Basin projects by Corvette since 2006 approximates \$0.59M. Most of this exploration expenditure can be directly related to drilling and bulk testwork. Combining Corvette's expenditure and the 'replacement cost' of the historic exploration database results in an 'Exploration Base' (EB) of some \$1.79M.

The exploration work completed is generally considered to have been effective, resulting in the discovery of a number of deposits and prospects. Ravensgate considers that there is a reasonable likelihood that additional HMS discoveries will be made with further systematic exploration. On this basis, Ravensgate has reasonably elected to assign a range of productivity enhancement multipliers (PEMs) from 1.0 to 2.0, indicating that every dollar spent on regional exploration has returned between \$1.00 and \$2.00 in value.

Applying the EB of \$1.79M on and a range of PEMs from 1.0 to 2.0 Ravensgate derives a range of provisional values for the exploration potential from \$1.79M to \$3.58M, within which range we have selected a preferred provisional value of \$2.68M. The preferred value reflects the reasonable exploration potential of the projects.

$4.6$ Otway Project

The Otway Project can be classified as an Exploration Area. The project is conceptual in nature and no significant exploration has taken place on the Otway Project. Taking into account Corvette's portfolio of HMS projects Ravensgate selected a preferred notional value of \$0.1M for a 100% interest in the Otway Project.

Inkerman Project $4.7$

The Inkerman Project can be classified as an Exploration Area. The project is conceptual in nature and no recent significant exploration has taken place on the Inkerman Project. Taking into account Corvette's portfolio of HMS projects Ravensgate selected a preferred notional value of \$0.1M for a 100% interest in the Otway Project.

Material Agreements $4.8$

The provisional project valuations reflect a 100% interest in each of the project assets in accordance with the Valmin Code. Ravensgate understands that all projects are 100% owned by Corvette. We are not aware, nor have we been made aware, of any other agreements that have a material influence on the provisional valuations of the Corvette mineral assets, and on this basis no further adjustments are necessary.

4,9 Valuation Summary

A summary of the Corvette mineral asset valuations is provided in Table 10. These valuations reflect Corvette's deemed equity interest in the various mineral assets. The applicable valuation date is 10 August 2009.

Table 10 Corvette Resources Limited - Mineral Assets Technical Valuation Summary
		Corvette		Valuation
Project	Asset	Equity Interest	Low SM	High SM	Preferred SM
Plumridge	Exploration Potential	100%	5.57	27.6	18.4
Murray Basin	Exploration Potential & Mineral Resources	100%	1.79	3.58	2.68
Otway	Exploration Potential	100%	0.10	0.10	0.10
Inkerman	Exploration Potential	100%	0.10	0.10	0.10
Total*			7.36	31.2	21.1

* Note: Totals may not add up due to rounding error

The value of Corvette Resources Limited's equity interest in the various mineral assets is considered to lie in a range from \$7.36M to \$31.2M, within which range we have selected a preferred value of \$21.1M.

REFERENCES 5.

Ammtec Ltd, (2007), Staged Recovery of Heavy Mineral Concentrate from a Wedderburn Mineral Sands Composite for Niplats Australia Pty Ltd.

Corvette Resources Limited, (2008), Quarterly Report for the period ended 31 December 2008.

Cook, A.S., (2008), EL 5089, Otway Basin, Annual Technical Report for the period 08 November 2007 to 30 June 2008.

Hyde, R., (2007), Independent Geologist's Report Prepared by RSG Global Consulting Pty Ltd on behalf of: Mineral Sands Limited.

Murphy, S.K., (2009), Annual Technical Report, 2008, Plumridge Project, Combined Reporting, C23/2006, E28/1475, E28/1476, E28/1537, E28/1556, E28/1557, E28/1558, E39/1084,E39/1085, E39/1116, E39/1117, E39/1118, E39/1119.

Snowden Mining Industry Consultants, 2006. Avonbank, Graybridge and Wedderburn resource estimate. Memorandum for Niplats Australia Ltd.

Snowden Mining Industry Consultants, 2007. Avonbank Resource Update. Memorandum for Mineral Sands Ltd.

Teakle, M.G., (2007), EL 5016, Kalkee, Annual Technical Report for the period 26 April 2007 to 31 December 2007.

Teakle, M.G., (2008), EL 4955, Avonbank, Annual Technical Report for the period ending 31 December 2006.

Teakle, M.G., (2008), EL 4979 Cannie West, Annual Technical Report For the Period 1 July 2007 to 30 June 2008.

Teakle, M.G., (2008), EL 4912 Wedderburn, Annual Technical Report For the Period 1 October 2007 to 30 September 2008.

GLOSSARY $6.$

aeolian	formed or deposited by wind
alluvial	sand, clay and silt deposit - water transported
anomalous	a departure from the expected norm, generally geochemical or geophysical values higher or lower than the norm
auger	a corkscrew-shaped sampling tool
assay	a procedure where the element composition of a rock soil or mineral sample is determined
basement	Crust of the earth, igneous or metamorphic rocks overlain by sedimentary deposits
clastic	pertaining to sedimentary rocks composed primarily from fragments of pre-existing rocks or fossils
conformable	description of rock strata where the layers are uninterrupted through time
conglomerate	a sedimentary rock consisting of rounded rock fragments greater than 2mm in size cemented together
costean	exploration trench
diamond drilling	a method of obtaining a cylindrical core of rock by drilling with a diamond impregnated bit
dunes	regular accumulations of sand by well-established prevailing winds
fault	a fracture in rocks whereby rocks on one side have been moved relative to the rocks on the other
formation	distinctive rock unit, differing from adjacent rocks
g/t	grams per tonne
	heavy mineral sands consist of sand accumulations that contain significant amounts of heavy minerals
Heavy Minerals	heavy minerals consist of high density minerals that occur within the sands; they most commonly include leucoxene, rutile, ilmenite, zircon, and garnets
hematite	a common ore of iron, natural iron oxide that is reddish or brown in colour
hydrothermal	a term applied to hot aqueous solution having temperatures up to 400° C which may transport metals and minerals in solution
intracratonic	within a large stable mass of the earth's crust
JORC	Joint Ore Reserves Committee (of the Australian Institute of Mining and Metallurgy, Australian Institute of Geoscientists and the Minerals Council of Australia)
lithology	a term pertaining to the general characteristics of rocks
lode	a vein or other tabular mineral deposit with distinct boundaries
mafic	a dark igneous rock composed dominantly of iron and magnesium minerals (such as basalt)
оге	a volume of rock containing components or minerals in a mode of occurrence which renders it valuable for mining
orogeny	a period of mountain building

Palaeozoic	the era of geologic time that includes the Cambrian, Ordovician, Silurian, Devonian, Carboniferous, and Permian periods
pluton	a large body of intrusive igneous rock
quartz	mineral species composed of crystalline silica $(SiO2)$
radiometric	geophysical technique measuring emission from radioactive isotopes
RC drilling	Reverse Circulation drilling, whereby rock chips are recovered by airflow returning inside the drill rods, rather than outside, thereby returning more reliable samples
sedimentary	rocks formed by the deposition of particles carried by air, water or ice
sedimentation	the accumulation of sediment
shale	fine grained sedimentary rock with well defined bedding planes
tectonic	forces or movements resulting in the formation of geologic structural features
trommel	screened cylinder used to separate materials by size
ultramafic	dark to very dark coloured igneous rocks composed mainly of mafic minerals
unconformity	description of rock strata where the layers are interrupted, discontinuous

$\mathcal{I}$ $\hat{\boldsymbol{\theta}}$

APPENDIX 1

Corvette Resources Limited Tenement Details

PROJECT: 海绵的	ir devent	$10 \times 200$	$\mathbb{C}$ , $\mathbb{C}$ $200\,\mathbb{R}$				COMMIT
FLUMRIDGE	E39/1084		11-Jan-06	10 Jan-11	208.1	\$12,920.60	\$105,000	Corvette Resources
PLUMRIDGE	E39/1085		11-Jan-06	10-Jan-11	208.4	\$12,920.60	\$105,000	Corvette Resources
PLUMRIDGE	E28/1475		17-Nov-04	16-Nov-09	207.8	\$17,532.90	\$105,000	Corvette Resources
PLUMRIDGE	E28/1476		17 Nov 04	16 Nov 09	207.5	\$17,532.90	\$105,000	Corvette Resources
PLUMRIDGE	E39/1116		11-Jan-06	10-Jan-11	206	\$12,920.60	\$105,000	Corvette Resources
PLUMRIDGE	E39/1117		25-Nov-05	24-Nov-10	208	\$12,920.60	\$105,000	Corvette Resources
PLUMRIDGE	E39/1118		11 Jan 06	10 Jan 11	208.2	\$12,920.60	\$105,000	Corvette Resources
PLUMRIDGE	E28/1537		03-Feb-06	2-Feb-11	177.6	\$11,074.80	\$90,000	Corvette Resources
PLUMRIDGE	E28/1556		08-Feb-06	7-Feb-11	82.73	\$5,168.24	\$42,000	Corvette Resources
PLUMRIDGE	E28/1557		08 Feb 06	7 Feb - 11	172	\$10,705.64	\$87,000	Corvette Resources
PLUMRIDGE	E28/1558		08-Feb-06	7-Feb-11	207.1	\$12,920.60	\$105,000	Corvette Resources
PLUMRIDGE	E39/1119		26-Oct-06	25-Oct-11	208.6	\$12,920.60	\$70,000	Corvette Resources
WEDDERBURN	EL4912		30-Nov-05	30-Nov-10	193.5	50	\$35,640	Corvette Resources
GRAY BRIDGE	EL4915		$11 - Jan-06$	11-Jan-11	236	\$0	\$43,320	Corvette Resources
AVONBANK	EL 4955		12 Jul 06	12-Jul-11	27.5	\$0	\$18,600	Corvette Resources
CANNIE WEST	EL 4979		23 Aug 06	23 Aug-11	195	SO.	\$34,560	Corvette Resources
KALKEE	EL 5016		26-Apr-07	26-Apr-12	455	\$0	\$54,840	Corvette Resources
OTWAY BASIN	EL 5089		08 Nov 07	8 Nov 12	2937	SO.	\$296,200	Corvette Resources
MERIDIAN	ELA 5083	13-Aug 07			288			Corvette Resources
INKERMAN	EPM15549		28 Mar 07	28-Mar-12	85.56	\$3,239.60	\$33,500.0	Corvette Resources
INKERMAN	EPM15550	20-Apr-06			333.3			Corvette Resources
INKERMAN	EPM15551	20-Арг-06			331.2			Corvette Resources
INKERMAN	EPM15552	20-Apr-06			331.4			Corvette Resources
INKERMAN	EPM15553	20 Apr 06			333.9			Corvette Resources
INKERMAN	EPM15554		04-Apr-07	03-Apr-12	105.7	53,862.60	\$44,000	Corvette Resources
INKERMAN	EPM15555	20-Apr-06			303.3			Corvette Resources
INKERMAN	EPM15556	20 Apr 06			332.6			Corvette Resources
INKERMAN	EPM15557		23 Jul-08	22-Jul-13	329.4	\$2,618.00	\$25,000	Corvette Resources
INKERMAN	EPM15558		02-May-07	1-May-12	157.7	\$5,980.80	\$60,000	Corvette Resources
INKERMAN	EPM15559	20 Apr 06			332			Corvette Resources
INKERMAN	EPM15560		13-Jun-08	12-Jun-12	277	\$6,230.00	\$107,000	Corvette Resources
INKERMAN	EPM15561	20-Apr-06			209			Corvette Resources
INKERMAN	EPM15562	20 Apr 06			330.7			Corvette Resources