METRO MINING LIMITED — Capital/Financing Update 2014

Oct 21, 2014

22/10/2014 14:45 $643 \rightarrow$ Fax Server Page 1 of 12

HopgoodGanim

22 October 2014

Australian Securities Exchange Company Announcement Platform

By facsimile: 1300 135 638

Our Ref: 1486646 - Katherine Hammond

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Dear Sir/Madam

MetroCoal Limited - Off-market takeover bid for Cape Alumina Limited $(Cape) - Appendix 3B$

We refer to MetroCoal Limited's (Company or MetroCoal) off-market takeover bid for all of the fully paid ordinary shares in Cape Alumina Limited ACN 107 817 694 (Cape or Target) which are not already held by the Company, under Part 6.5 of the Corporations Act 2001 (Cth) (Corporations Act), (Takeover Bid).

For the purposes of the ASX Listing Rules, Corporations Act, and for all other purposes in relation to the Takeover Bid, please find attached an Appendix 3B for the issue of MetroCoal shares in consideration of MetroCoal's acquisition of Cape shares for the Takeover Bid acceptances received as at the close of trade on 20 October 2014.

A further Appendix 3B will be lodged as and when required for the issue of shares in respect of any subsequent acceptances received, in accordance with MetroCoal's Bidder's Statement and the Corporations Act.

Yours faithfully

zroodfann

Katherine Hammond Contact

Associate T0730240343 F 07 3024 0343 E k.hammond@hopgoodganim.com.au

Partner responsible: Michael Hansel

RRISBANE

Level 8, Waterfront Place 1 Eagle Street Brisbane Qld 4000 Australia

PO Box 7822 Waterfront Place Brisbane Old 4001 Australia

ABN: 54 105 489 661

BRISBANE

T +61 7 3024 0000 F +61 7 3024 0300

PERTH

T +61892118111 F +61892261696

www.hopgoodganim.com.au

Rule 2.7, 3.10.3, 3.10.4, 3.10.5

Appendix 3B

New issue announcement, application for quotation of additional securities and agreement

Information or documents not available now must be given to ASX as soon as available. Information and documents given to ASX become ASX's property and may be made public.

Introduced 01/07/96 Origin: Appendix 5 Amended 01/07/98, 01/09/99, 01/07/00, 30/09/01, 11/03/02, 01/01/03, 24/10/05, 01/08/12, 04/03/13

Name of entity

MetroCoal Limited

ABN

117 763 443

We (the entity) give ASX the following information.

Part 1 - All issues

You must complete the relevant sections (attach sheets if there is not enough space).

$\mathbf{1}$ ⁺Class of ⁺securities issued or to $\vert$ be issued

Fully Paid Ordinary Shares

Number of ⁺securities issued or to $\overline{2}$ be issued (if known) or maximum number which may be issued

3 Principal terms of the ⁺securities (e.g. if options, exercise price and expiry date; if partly paid *securities, the amount outstanding and due dates for payment; if +convertible securities, the conversion price and dates for conversion)

36,725,630

Fully paid ordinary shares, ranking equally in all respects with existing ordinary fully paid ordinary shares.

⁺ See chapter 19 for defined terms.

4	Do the + securities rank equally in all respects from the + issue date with an existing + class of quoted +securities?	Yes
	If the additional + securities do not rank equally, please state: the date from which they do ۰ which the extent to they $\bullet$ participate for the next dividend, (in the case of a trust, distribution) interest or payment the extent to which they do not rank equally, other than in relation to the next dividend, distribution or interest payment
5	Issue price or consideration	1 MetroCoal Limited (MTE) share issued for every 1.3 Cape Alumina Limited (CBX) share of CBX shareholders who have accepted MTE's off-market takeover offer for all of the shares in CBX that MTE does not already hold MTE's Bidder's Statement pursuant to (Bidder's Statement) dated 19 August 2014 (as subsequently supplemented and varied from time to time) (Offer).
6	Purpose of the issue (If issued as consideration for the acquisition οf clearly assets, identify those assets)	As consideration for acceptances received pursuant to the Offer, in order to acquire CBX shares.
6a	Is the entity an $\pm$ eligible entity that obtained security holder has approval under rule 7.1A?	Yes
	If Yes, complete sections $6b - 6h$ in relation to the $+$ securities the subject of this Appendix 3B, and comply with section 6i
6b	The date the security holder resolution under rule 7.1A was passed	29/11/2013
6с	+securities $\circ$ f Number issued without security holder approval under rule 7.1	Nil

• 6d Number of ⁺securities issued with security holder approval under rule $7.1A$
• Number of ⁺securities issued with $6e$ security holder approval under rule 7.3, or another specific security holder approval (specify date of meeting)
• Number of ⁺securities issued under 6f an exception in rule 7.2
• If ⁺securities issued under rule 6g 7.1A, was issue price at least 75% of 15 day VWAP as calculated under rule 7.1A.3? Include the ⁺issue date and both values. Include the source of the VWAP calculation.
• $6_h$ If ⁺securities were issued under $7.1A$ for rule non-cash consideration, state date on which valuation of consideration was released $\mathbf{t}$ ASX Market Announcements
• $6i$ Calculate the entity's remaining issue capacity under rule 7.1 and rule 7.1A - complete Annexure 1 and release to ASX Market Announcements
• $\overline{7}$ ⁺Issue dates

Note: The issue date may be prescribed by ASX (refer to the definition of issue date in rule 19.12). For example, the issue date for a pro rata entitlement issue must comply with the applicable timetable in Appendix 7A.

Cross reference: item 33 of Appendix 3B.

8 Number and $^+$ class of all ⁺securities quoted on ASX (including the⁺securities in section 2 if applicable)

Number	+Class
245,609,293	Ordinary fully paid shares

Nil

Nil

Ni1

$\overline{\text{N/A}}$

$N/A$

Listing Rule $7.1 - 36,841,394$ Listing Rule $7.1A - 24,560,929$

22 October 2014

• See chapter 19 for defined terms.

		Number	+ Class
9	Number and + class οf all *securities not quoted on ASX (including the + securities in section 2 if applicable)	2,000,000	Unlisted options
10	Dividend policy (in the case of a trust, distribution policy) on the increased capital (interests)	Unchanged
	Part 2 - Pro rata issue
11	security holder approval Is. required?
12	Is the issue renounceable or non- renounceable?
13
	Ratio in which the + securities will be offered
14	+ Class of + securities to which the
	offer relates
15	+ Record date determine to entitlements
16	Will holdings on different registers
	(or subregisters) be aggregated for calculating entitlements?
17	Policy for deciding entitlements in relation to fractions
18	Names of countries in which the entity has security holders who will not be sent new offer documents
	Note: Security holders must be told how their entitlements are to be dealt with.
	Cross reference: rule 7.7.
19	Closing $\sigma f$ date for receipt acceptances or renunciations

• 32 How do security holders dispose of their entitlements (except by sale through a broker)?
• 33 ⁺Issue date

Part 3 - Ouotation of securities

You need only complete this section if you are applying for quotation of securities

• 34 Type of ⁺securities (tick one)
• ⁺Securities described in Part 1 $(a)$
• All other ⁺securities $(b)$

Example: restricted securities at the end of the escrowed period, partly paid securities that become fully paid, employee incentive share securities when restriction ends, securities issued on expiry or conversion of convertible securities

Entities that have ticked box 34(a)

Additional securities forming a new class of securities

Tick to indicate you are providing the information or documents

• 35 If the ⁺securities are ⁺equity securities, the names of the 20 largest holders of the additional ⁺securities, and the number and percentage of additional ⁺securities held by those holders
• 36 If the ⁺securities are ⁺equity securities, a distribution schedule of the additional *securities setting out the number of holders in the categories $1 - 1,000$ $1,001 - 5,000$ $5,001 - 10,000$ $10,001 - 100,000$ 100,001 and over
• A copy of any trust deed for the additional +securities

37

⁺ See chapter 19 for defined terms.

Entities that have ticked box 34(b)

• Number of ⁺securities for which 38 ⁺quotation is sought
• 39 ⁺Class of ⁺securities for which quotation is sought
• 40 Do the ⁺securities rank equally in all respects from the ⁺issue date with an existing ⁺class of quoted ⁺securities?

If the additional ⁺securities do not rank equally, please state:

• the date from which they do
• the extent to which they participate for the next dividend, (in the case of a trust, distribution) or interest payment
• the extent to which they do not $\bullet$ rank equally, other than in relation to the next dividend, distribution or interest payment
• $41$ Reason for request for quotation now

Example: In the case of restricted securities, end of restriction period

(if issued upon conversion of another ⁺security, clearly identify that other ⁺security)

42 Number and ⁺class of all ⁺securities quoted on ASX (including the +securities in clause 38)

+ Class

⁺ See chapter 19 for defined terms.

Quotation agreement

• $\mathbf{1}$ +Ouotation of our additional +securities is in ASX's absolute discretion. ASX may quote the ⁺securities on any conditions it decides.
• $\overline{2}$ We warrant the following to ASX.
• The issue of the ⁺securities to be quoted complies with the law and is not for an illegal purpose.
• There is no reason why those *securities should not be granted *quotation.
• An offer of the ⁺securities for sale within 12 months after their issue will not require disclosure under section $707(3)$ or section $1012C(6)$ of the Corporations Act.

Note: An entity may need to obtain appropriate warranties from subscribers for the securities in order to be able to give this warranty

• Section 724 or section 1016E of the Corporations Act does not apply to any applications received by us in relation to any ⁺securities to be quoted and that no-one has any right to return any ⁺securities to be quoted under sections 737, 738 or 1016F of the Corporations Act at the time that we request that the +securities be quoted.
• If we are a trust, we warrant that no person has the right to return the *securities to be quoted under section 1019B of the Corporations Act at the time that we request that the ⁺securities be quoted.
• $\overline{3}$ We will indemnify ASX to the fullest extent permitted by law in respect of any claim, action or expense arising from or connected with any breach of the warranties in this agreement.
• $\overline{4}$ We give ASX the information and documents required by this form. If any information or document is not available now, we will give it to ASX before ⁺quotation of the ⁺securities begins. We acknowledge that ASX is relying on the information and documents. We warrant that they are (will be) true and complete.

Sign here:

...................................... (Company secretary)

oo oo oo oo oo

Print name: Scott Waddell

⁺ See chapter 19 for defined terms.

Appendix 3B - Annexure 1

Calculation of placement capacity under rule 7.1 and rule 7.1A for eligible entities

Introduced 01/08/12 Amended 04/03/13

Part 1

Rule 7.1 $-$ Issues exceeding 15% of capital
Step 1: Calculate "A", the base figure from which the placement capacity is calculated
Insert number of fully paid +ordinary securities on issue 12 months before the *issue date or date of agreement to issue	208,883,663
Add the following:
Number of fully paid +ordinary securities issued in that 12 month period under an exception in rule 7.2	36,725,630
Number of fully paid +ordinary securities , issued in that 12 month period with shareholder approval
Number of partly paid +ordinary $\bullet$ securities that became fully paid in that 12 month period
Note: Include only ordinary securities here - other classes of equity securities cannot be added Include here (if applicable) the securities the subject of the Appendix 3B to which this form is annexed It may be useful to set out issues of securities on different dates as separate line items
Subtract the number of fully paid +ordinary securities cancelled during that 12 month period
"А"	245,609,293

$+$ See chapter 19 for defined terms.

Step 2: Calculate 15% of "A"
"B"	0.15
	[Note: this value cannot be changed]
Multiply "A" by 0.15	36,841,394
Step 3: Calculate "C", the amount of placement capacity under rule 7.1 that has already been used
Insert number of + equity securities issued or agreed to be issued in that 12 month period not counting those issued:	Nil
Under an exception in rule 7.2
Under rule 7.1A
With security holder approval under rule 7.1 or rule 7.4
Note: This applies to equity securities, unless specifically excluded - not just ordinary securities Include here (if applicable) the securities $\bullet$ the subject of the Appendix 3B to which this form is annexed It may be useful to set out issues of $\bullet$ securities on different dates as separate line items
"C"	Nil
Step 4: Subtract "C" from ["A" x "B"] to calculate remaining placement capacity under rule 7.1
" $A$ " $\times$ 0.15	36,841,394
Note: number must be same as shown in Step 2
Subtract "C"	Nil
Note: number must be same as shown in Step 3
Total ["A" $\times$ 0.15] – "C"	36,841,394 [Note: this is the remaining placement capacity under rule 7.1]

$+$ See chapter 19 for defined terms.

Part 2

Rule 7.1A – Additional placement capacity for eligible entities
Step 1: Calculate "A", the base figure from which the placement capacity is calculated
"A"	245,609,293
Note: number must be same as shown in Step 1 of Part 1
Step 2: Calculate 10% of "A"
"ח	0.10
	Note: this value cannot be changed
Multiply "A" by 0.10	24,560,929
Step 3: Calculate "E", the amount of placement capacity under rule 7.1A that has already been used
Insert number of +equity securities issued or agreed to be issued in that 12 month period under rule 7.1A	Nil
Notes: This applies to equity securities - not just ordinary securities Include here $-$ if applicable $-$ the securities the subject of the Appendix 3B to which this form is annexed Do not include equity securities issued under rule 7.1 (they must be dealt with in Part 1), or for which specific security holder approval has been obtained It may be useful to set out issues of securities on different dates as separate line items "E"	Nil

$+$ See chapter 19 for defined terms.

Step 4: Subtract "E" from ["A" x "D"] to calculate remaining
| placement capacity under rule 7.1A

"A" $\times$ 0.10	24,560,929
Note number must be same as shown in Step 2
Subtract "E"	Nil
Note number must be same as shown in Step 3
Total ["A" $\times$ 0.10] – "E"	24,560,929
	Note: this is the remaining placement capacity under rule 7.1A

$+$ See chapter 19 for defined terms.