LCL RESOURCES LIMITED — M&A Activity 2008

Dec 23, 2008

SUPPLEMENTARY BIDDER'S STATEMENT

FOR OFF-MARKET OFFERS MADE BY

METMINCO tTD

ACN 119 759 349

OFFERS TO ACQUIRE ALL YOUR SHARES AND OPTIONS IN

HAMPTON MINING LIMITED

ACN 103 712385

2.5 Metminco Shares for every Hampton Share 1,875 Metminco Shares for every Hampton Mar 09 Option 0.9 Metminco Shares for every Ilampton Apr 09 Option

This ¡s an important document and requires your immediate attent¡on. lf you are in any doubt as to how to deal with ¡t, you should obtain advice from your legal, financial or other adviser immediately.

Further information: Please call 03 5332 2100 if you have any questions or require assistance with your acceptance. For instructions on how to accept the Offers, see section 12 of the B¡dder's Statement.

lNTRoDUcrtoN

Th¡s document ¡s a Supplementary Bidde/s Statement dated 24 December 2008 and ¡s supplementary to the Bidder's Statement dated 10 December 2008 given by Metminco Lim¡ted (Metminco) to Hampton Min¡ng Limited (Hampton) under Part 6.5 of the Corporations Act and lodged with ASIC on 10 December 2008.

Words and phrases deîned in the B¡ddeis Statement have the same meanings where used in this Statement. Th¡s Statement w¡ll preva¡l over the B¡dder's Statement to the efent of any ¡nconsistency. References to "sect¡ons" are to sect¡ons ¡n the Bidde/s Statement.

KEY DATEs

The follow¡ng amended dates apply to the events specified below ¡n the Key Dates sect¡on on page 7 of he Bidder's Statement:

Expected date for despatch of Not¡ce of Meet¡ng for Metminco Shareholders Meeting l6 January ²⁰⁰⁹ Metm¡nco Shareholders Meeting to approve Offer '17 February 2009 Scheduled clos¡ng date of Offers (unless efended) ²⁴February 2009

Co N sEeu EN TraL CHANGEs ro DATES

The follow¡ng changes are made as a consequence of the above changes ¡n Key Dates.

Sect¡on No.	Sect¡on Head¡nq	Replace	w¡th
	Chairman's Letter	30 Januarv 2009	24 FeûuaN 2oog
1.3	Other Quest¡ons - When do the Offers close?	30 Januarv 2009	24 Februarv 2009
3.5	The Offer Per¡od	30 Januarv 2009	24 Februarv 2009
3.9	How to Acceot the Offers	30 Januarv 2009	24 Februarv 2009
't2.2.8	Metminco Shareholder AoDroval	I Februarv 2009	17 Februarv 2009
12.5.4	Metm¡nco Shareholder Aoorovâl	I Februarv 2009	17 Februarv 2009
12.8.8	Metm¡nco Shareholder Approval	I Februarv 2009	17 Februarv 2009
12.'tO	Offer Per¡od	30 Januarv 2009	24 Februarv 2009
12.20	Not¡ce on the status of conditions	23 January 2009	17 Februarv 2009
	Glossarv - Offer Per¡od	30 Januarv 2009	24 Feúuav 2009

SEcfloN I FREoUENTLY ASKED QuEsrroNs aBour rHE oFFERS

Sect¡ons 1.1 and 1.2 of the B¡dder's Statement are amended as follows:

An âdd¡tional factor is ¡ncluded in the answer to the follow¡ng questìon ¡n sect¡on '1.1 - Share Offer.

Are there any condit¡ons to I Add¡t¡onal factor:
the Share Offer?	- Shareholders of Metm¡nco have approved the takeover of Hampton by
	l\4etminco - see section12.8 for full deta¡ls of this cond¡tion.

The same add¡t¡onal factor ¡s included ¡n the answer to the quest¡on "Are there any cond¡tions to the Opt¡ons Offers?" ¡n sect¡on 1.2 ODt¡ons Offers.

SEcfloN 8.2 CAprrAL STRucruRE AND OwNERsHrp

The f¡rst 2 paragraphs of, and Table 12 ¡n, sect¡on 8.2 of the Biddeis Statement are replaced by the following:

As at 10 December 2008, Metminco had 53,000,005 fully paid ord¡nary shares on issue- lf all Hampton Security Holders accept the Offers, Metm¡nco w¡ll ¡ssue up to a max¡mum of 556,330,128 add¡t¡onal l\4etminco shares to Hampton Secur¡ty Holders.

Assuming that Metm¡nco acqu¡res 100% of the shares in Hampton, the follow¡ng table shows the issued and fully pa¡d share cap¡tal of Metm¡nco as it w¡ll be ¡mmed¡ately following complet¡on of the Offers, based on the number of Hamoton secur¡ties set out below.

Table 1 - Share Cap¡tal of Metminco at date of this B¡ddels Statement, adjusted for Acqu¡sit¡on

Metm¡nco

Shares on ¡ssue		53,000,005
Hampton	Harnpton Offer Secur¡ties Rat¡o	t¡lètm¡nco Shares
Shares on issue	20A,2O7,O51 2.5	520,5'17,628
Mar 09 Options (1)	9,500,000 1.875	17,a12,500
Apr 09 Options (1)	20,000,000 0.900	18,000,000
Fully diluted (1)	237,707,051	556,330,128
Metminco (post merger) (assum¡ng 100% acceptance)
Shares on issue
Current Metm¡nco	53.000.005
Hampton acceptances 556,330,128		609,330,133
Metm¡nco Options (MNCO)		26,230,0'17
Fully d¡luted		635,560,150
Ownersh¡p Compos¡t¡on (post-mergêrxl )		Excl. MNCO
Metminco shareholders		8.7O%	'12.47%
Hâmpton shareholders		91.3oyo 87.53%
		'100.00% 100.00%

Note

(1) Assumes that Metminco acquires but does not exerc¡se the Hampton opt¡ons.

SEcrroN 8.4 PRo-FoRMA CoNsoLtDATEo BALANCE SHEETs FoR THE MERGED GRoup

The Pro-forma Balance Sheets prov¡ded in sect¡ons 8.4.1 and 8.4.2 ofthe Bidder's Statement are replaced by the Pro-forma Balance Sheets set out below and sect¡on 8.4.4 is replaced by the sectìon below.

These replacements are made due to the follow¡ng account¡ng ¡nterpretat¡on:

• . The Australian Account¡ng Standard relating to acqu¡sition accountìng, AASB 3 Bus¡ness Comb¡nat¡ons, requ¡res that all bus¡ness comb¡nations must be accounted for by applyìng the purchase method. This requ¡res an acqu¡rer to be identified based on control, deflned as "the power to govern the financial and operating pol¡c¡es of an ent¡ty so as to obtain benefìts from ¡ts act¡v¡t¡es". This may result ¡n the legal acquirer ¡n a business combinat¡on not being treated as the acquirer from an account¡ng perspective. Paragraphs 6 and 7 of AASB 3, AASB 127 and paragraphs B-14-818 of AASB 3 clar¡û how the treatment should be applied.
• . lf Metminco (as the parent entity, ¡n legal terms) acquires Hampton ¡n accordance with the terms of the Offers, the current shareholders of Hampton (¡n the subs¡d¡ary, in legal terms) will hold in

excess of 90% of the expanded share capital of Metminco. This will make Hampton the acquirer under AASB 3 unless it can be demonstrated that such ownership does not constitute control.

Metminco intends to appoint one or more Hampton directors (if they consent to appointment) to the Board of Metminco and to seek agreement from the managing director of Hampton to become the managing director of Metminco. See section 8 of the Bidder's Statement.

Based on this interpretation, the Pro-forma Balance Sheets provided below have been prepared as if Hampton was the acquirer.

Hampton Securityholders should be aware that this treatment is made for the purposes of Accounting Standards but does not result in any Hampton shareholder having control of Metminco in a legal terms.

SECTION 8.4.1 BALANCE SHEET (1): PRO-FORMA BASED ON 100% CONTROL

Table 2 - Metminco Pro forma Balance Sheet as at 30 June 2008 based on 100% Control

ASSETS	\$
CURRENT ASSETS
Cash and cash equivalents	21,584,368
Trade and other receivables	104,253
Other current assets	445,798
TOTAL CURRENT ASSETS	22,134,419
NON-CURRENT ASSETS
Receivables	628,321
Investment accounted for using equity method	1,627,351
Property, plant & equipment	159,209
Goodwill	7,646
Exploration and evaluation expenditure	10,812,586
TOTAL NON-CURRENT ASSETS	13,235,113
TOTAL ASSETS	35,369,532
CURRENT LIABILITIES
Trade and other payables	768,646
Short-term provisions	4,528
TOTAL CURRENT LIABILITIES	773,174
TOTAL LIABILITIES	773,174
NET ASSETS	34,596,358
EQUITY
Issued Capital	38,801,988
Reserves	$-1,723,414$
Retained earnings	$-2,482,216$
TOTAL EQUITY	34,596,358

SECTION 8.4.2 BALANCE SHEET (2): PRO-FORMA BASED ON 60% CONTROL

Table 3 - Metminco Pro forma Balance Sheet as at 30 June 2008 based on 60% Control

Scenario (1)	A - Acquire all Hampton Options	B - Acquire Mar 09 Options only	C-Acquire Apr 09 Options only
	2008	2008	2008
	\$	\$	\$
ASSETS
CURRENT ASSETS
Cash and cash equivalents	13.897.332	13,897,332	13,897,332
Trade and other receivables	62,552	62.552	62,552
Other current assets	280.075	280,075	280.075
TOTAL CURRENT ASSETS	14.239.959	14.239.959	14.239.959
NON-CURRENT ASSETS
Receivables	376.993	376,993	376,993
Investment accounted for using equity method	976,411	976,411	976,411
Property, plant & equipment	105,375	105,375	105,375
Goodwill		41,145	39,418
Exploration and evaluation expenditure	6,801,846	6,801,846	6,801,846

$\overline{{C0113324:1}}$

TOTAL NON-CURRENT ASSETS	8.260.625	8.301.770	8.300.043
TOTAL ASSETS	22,500.584	22,541,729	22.540.002
CURRENT LIABILITIES
Trade and other payables	542.200	542.200	542,200
Short-term provisions	4.528	4.528	4,528
TOTAL CURRENT LIABILITIES	546.728	546,728	546 728
TOTAL LIABILITIES	546.728	546,728	546728
NET ASSETS	21.953.856	21,995,001	21.993.274
EQUITY
Issued Capital	24.361.053	24.518.379	24,516,652
Reserves	$-917.867$	$-1,034,048$	$-1,034,048$
Retained earnings	-1,489,330	$-1,489,330$	$-1,489,330$
TOTAL EQUITY	21.953.856	21.995.001	21.993.274

Note $(1)$

Note that this Balance Sheet provides three alternative scenarios under which Metminco could achieve 60% ownership of the share capital of Hampton:

• acceptance of the Share Offer for sufficient shares to achieve a 60% interest and acceptance of both of А the Option Offers:
• B acceptance of the Share Offer for sufficient shares to achieve a 60% interest, acceptance of the Mar 09 Option Offer and non-acceptance of the Apr 09 Option Offer: $\hat{C}$
• acceptance of the Share Offer for sufficient shares to achieve a 60% interest, non-acceptance of the Mar 09 Option Offer and acceptance of the Apr 09 Option Offer.

SECTION 8.3.4 HAMPTON ACQUISITION

• $(a)$ Financial information regarding Hampton other than Hampton's 2008 Half Year Financial Report (which was obtained from Hampton) has been obtained from publicly available sources. Metminco is not aware of any events subsequent to the Hampton balance date used in the pro-forma 30 June 2008 which would materially alter the information presented above.
• $(b)$ The pro-forma information presented in balance sheets (1) and (2) assumes the acquisition of Hampton by Metminco had been completed by that date. The actual date of the acquisition will be at a later date.
• The pro-forma information presented in balance sheet (2) where Metminco acquires 60% of $(c)$ Hampton Shares has been adjusted to reflect the transaction costs and consideration where Metminco acquires 60% of Hampton Shares on a pro-rata basis.
• $(d)$ A reduction in cash of \$150,000 in the balance sheets (1) and (2) where Metminco has acquired 100% and 60% respectively of Hampton Shares, reflects transaction costs that may be incurred when acquiring 100% and 60% respectively of Hampton Shares. These are estimates only.
• $(e)$ Intangible assets recognised on acquisition may need to be amortised over the period of their economic benefit to the Merged Group and such amortisation charges reduce future reported earnings. Due to limited public information available, it is not possible for Metminco to identify these intangible assets and consequent amortisation at this time.
• $(f)$ Cash and Issued Capital have been increased by \$700,000 from the 30 June 2008 Balance Sheets to reflect cash raised by Hampton since 30 June 2008 through the exercise of 5,600,000 March 2009 options.

SECTION 11.13 FIRB APPROVAL

In the Bidder's Statement, the pro forma consolidated balance sheet for Metminco for a 100% acquisition in section 8.4.1, after completion of the acquisition, showed total assets in excess of \$100 million. On that basis, it would have been necessary for any Hampton Security Holder wishing to accept the Offers who is a foreign resident with a 15% or greater interest in Hampton, to notify the Treasurer seeking approval for the investment, through the Foreign Investment Review Board (FIRB) under the Foreign Acquisitions and Takeovers Act 1975 (FATA Act). The change in accounting treatment described in the replacement section 8.4.1 shows total assets of less than \$100 million. As a result, FIRB approval is not required.

Dated 24 December 2008

John A Fillmore Chairman, Metminco Limited being a director of Metminco Limited authorised to sign this Supplementary Bidder's Statement pursuant to a unanimous resolution passed at a meeting of the directors of Metminco Limited held on 24 December 2008.