NT MINERALS LIMITED - Proxy Solicitation & Information Statement 2012

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ACN 059 326 519

NOTICE OF GENERAL MEETING, EXPLANATORY STATEMENT AND PROXY FORM

TO ASSIST SHAREHOLDERS IN THEIR CONSIDERATION OF RESOLUTIONS TO BE PUT AT

A GENERAL MEETING OF THE COMPANY TO BE HELD AT Ground Floor, 3 Richardson Street, West Perth, Western Australia 6005 ON 15 January 2013 AT 10.00am WST

THIS DOCUMENT IS IMPORTANT

An Independent Expert’s Report is attached to this Notice, in Annexure E, as required by ASIC Regulatory Guide 74. The Independent Expert’s Report concludes that the transactions the subject of Resolutions 1 and 3 in this Notice of Meeting are fair and reasonable to the Company’s non-associated Shareholders, for the reasons set out in the report. The Independent Expert’s Report is available via the Company’s website: www.redbankcopper.com.au

If you do not understand this document or are in any doubt as to how to deal with this document, you should consult your stockbroker, solicitor, accountant or other professional adviser immediately. Should you wish to discuss the matters in this Notice of General Meeting please do not hesitate to contact the Company Secretary on +61 8 6389 6400

www.redbankcopper.com.au

Notice of General Meeting (setting out the proposed Resolutions)

Explanatory Statement (explaining the proposed Resolutions)

Glossary

Annexure A – MATERIAL TERMS OF THE RESTRUCTURE DEED

Annexure B – MATERIAL TERMS OF THE SWAN GOLD RESTRUCTURE DEED

Annexure C – COMPANY CAPITAL STRUCTURE

Annexure D – TERMS AND CONDITIONS OF SHARES

Annexure E – INDEPENDENT EXPERT’S REPORT

REDBANK COPPER LIMITED ACN 059 326 519

NOTICE OF GENERAL MEETING

Notice is hereby given that a General Meeting of Shareholders will be held at Ground Floor, 3 Richardson Street, West Perth, Western Australia 6005 on 15 January 2013 at 10.00am WST for the purpose of transacting the following business.

The purpose of the attached Explanatory Statement is to provide information to Shareholders to enable each Shareholder to make an informed decision regarding the Resolutions set out in this Notice of General Meeting.

Resolutions 1 to 10 are inter-conditional on each other and accordingly, Resolutions 1 to 10 will not have effect unless and until each of Resolutions 1 to 10 is passed.

If Shareholders are in doubt as to how they should vote, they should seek advice from their professional advisors before voting.

The Explanatory Statement is to be read in conjunction with this Notice of General Meeting. Capitalised words and expressions in this Notice of General Meeting have the same meaning as in the Explanatory Statement and, where not defined in the Explanatory Statement, are defined in the attached Glossary.

AGENDA

1 RESOLUTION 1 – APPROVAL OF ISSUE OF PLACEMENT SECURITIES TO INVESTMET AS UNDERWRITER OR PLACEE, MICHAEL FOTIOS AND THEIR RESPECTIVE ASSOCIATES

To consider and if thought fit to pass the following Resolution as an ordinary Resolution:

“Conditional upon Resolutions 2, 3, 4, 5, 6, 7, 8, 9 and 10 being passed, that, for the purposes of Item 7 of section 611 of the Corporations Act and Listing Rule 10.11 and for all other purposes, Shareholders approve the issue of up to 1 billion Shares at $0.005, to Investmet Limited as underwriter of the Placement or 2 billion Shares at $0.005 as underwriter and placee or to Michael Fotios (or nominees controlled by Michael Fotios) or to Investmet’s Associates (to the extent such securities are not issued to sophisticated investors in accordance with Resolution 2) on the terms set out in the Explanatory Statement.”

Independent Expert’s Report: Shareholders should carefully consider the Independent Expert’s Report prepared by Stantons International Securities for the purposes of the Shareholder approval required under Item 7 of section 611 of the Corporations Act which concludes that the transaction is fair and reasonable to the non-associated Shareholders in the Company.

Voting Exclusion: The Company will disregard any votes cast on this Resolution by Investmet Limited or any of its Associates. However, the Company need not disregard a vote if it is cast by a person as proxy for a person who is entitled to vote, in accordance with the directions on the proxy form or it is cast by the person chairing the Meeting as

proxy for a person who is entitled to vote, in accordance with a direction on the proxy form to vote as the proxy decides.

2 RESOLUTION 2 – APPROVAL OF PLACEMENT SECURITIES TO SOPHISTICATED INVESTORS

To consider and, if thought fit, to pass with or without amendment, the following Resolution as an ordinary Resolution:

“Conditional upon Resolutions 1, 3, 4, 5, 6, 7, 8, 9 and 10 being passed, that, for the purposes of Listing Rule 7.1 and for all other purposes, Shareholders approve the issue of up to 2 billion Shares at $0.005 each to sophisticated investors (to the extent such securities are not issued to Investmet, Michael Fotios or their respective associated nominees in accordance with Resolution 1) on the terms set out in the Explanatory Statement.”

Voting Exclusion: The Company will disregard any votes cast on this Resolution by a person who may participate in the issue of the shares and a person who might obtain a benefit (except a benefit solely in their capacity as holders of ordinary shares) if the Resolution is passed, or of an Associate of that person. However, the Company need not disregard a vote if it is cast by a person as proxy for a person who is entitled to vote, in accordance with the directions on the proxy form or it is cast by the person chairing the Meeting as proxy for a person who is entitled to vote, in accordance with a direction on the proxy form to vote as the proxy decides.

3 RESOLUTION 3 – APPROVAL FOR INVESTMET ACQUISITION OF RELEVANT INTEREST IN SHARES FROM STIRLING RESOURCES

To consider and if thought fit to pass the following Resolution as an ordinary Resolution:

“Conditional upon Resolutions 1, 2, 4, 5, 6, 7, 8, 9 and 10 being passed, that, for the purposes of Item 7 of section 611 of the Corporations Act and for all other purposes, Shareholders approve the acquisition by Investmet Limited or Investmet’s Associates of a relevant interest in 68,876,665 Shares, being Shares held by Stirling Resources (through its wholly owned subsidiary, Stirling Copper Pty Ltd) and representing approximately 17.5% of the issued capital of the Company, as a result of the Group Restructure; on the terms set out in the Explanatory Statement.”

4 RESOLUTION 4 – APPROVAL OF ISSUE OF SECURITIES TO STIRLING RESOURCES

To consider and, if thought fit, to pass with or without amendment, the following Resolution as an ordinary Resolution:

“Conditional upon Resolutions 1, 2, 3, 5, 6, 7, 8, 9 and 10 being passed, that, for the purposes of Listing Rule 7.1 and for all other purposes, Shareholders approve the issue of up to 178,000,000 Shares at $0.005 each to Stirling Resources on the terms set out in the Explanatory Statement.”

Voting Exclusion: The Company will disregard any votes cast on this Resolution by Stirling Resources if the Resolution is passed, or of an Associate of Stirling Resources. However, the Company need not disregard a vote if it is cast by a person as proxy for a person who is entitled to vote, in accordance with the directions on the proxy form or it is cast by the person chairing the Meeting as proxy for a person who is entitled to vote, in accordance with a direction on the proxy form to vote as the proxy decides.

5 RESOLUTION 5 – APPROVAL OF PLACEMENT SECURITIES TO DAMIAN DELANEY

To consider and, if thought fit, to pass with or without amendment, the following Resolution as an ordinary Resolution:

“Subject to Resolutions 1, 2, 3, 4, 6, 7, 8, 9 and 10 being passed, that for the purposes of Listing Rule 10.11, and for all other purposes, Shareholders approve, the allotment and issue of Shares up to $1,000,000 (being 200 million Shares) on the terms set out in the Explanatory Statement, to Damian Delaney as a related party of the Company (or any entity nominated by Damian Delaney).”

Voting Exclusion: The Company will disregard any votes cast on this Resolution by the related party and a person who might obtain a benefit (except a benefit solely in their capacity as holders of ordinary shares) if the Resolution is passed, or of an Associate of that person. However, the Company need not disregard a vote if it is cast by a person as proxy for a person who is entitled to vote, in accordance with the directions on the proxy form or it is cast by the person chairing the Meeting as proxy for a person who is entitled to vote, in accordance with a direction on the proxy form to vote as the proxy decides.

6 RESOLUTION 6 – APPROVAL OF PLACEMENT SECURITIES TO MARTIN DEPISCH

To consider and, if thought fit, to pass with or without amendment, the following Resolution as an ordinary Resolution:

“Subject to Resolutions 1, 2, 3, 4, 5, 7, 8, 9 and 10 being passed, that for the purposes of Listing Rule 10.11, and for all other purposes, Shareholders approve, the allotment and issue of Shares up to $1,000,000 (being 200 million Shares) on the terms set out in the Explanatory Statement, to Martin Depisch as a related party of the Company (or any entity nominated by Martin Depisch).”

7 RESOLUTION 7 – APPROVAL OF PLACEMENT SECURITIES TO THOMAS STYBLO

To consider and, if thought fit, to pass with or without amendment, the following Resolution as an ordinary Resolution:

“Subject to Resolutions 1, 2, 3, 4, 5, 6, 8, 9 and 10 being passed, that for the purposes of Listing Rule 10.11, and for all other purposes, Shareholders approve, the allotment and issue of Shares up to $1,000,000 (being 200 million Shares) on the terms set out in the Explanatory Statement, to Thomas Styblo as a related party of the Company (or any entity nominated by Thomas Styblo).”

8 RESOLUTION 8 – APPROVAL OF PLACEMENT SECURITIES TO GERHARD KORNFELD

To consider and, if thought fit, to pass with or without amendment, the following Resolution as an ordinary Resolution:

“Subject to Resolutions 1, 2, 3, 4, 5, 6, 7, 9 and 10 being passed, that for the purposes of Listing Rule 10.11, and for all other purposes, Shareholders approve, the allotment and issue of Shares up to $1,000,000 (being 200 million Shares) on the terms set out in the Explanatory Statement, to Gerhard Kornfeld as a related party of the Company (or any entity nominated by Gerhard Kornfeld)”.

9 RESOLUTION 9 – APPROVAL OF PLACEMENT SECURITIES TO PETER FARRIS

To consider and, if thought fit, to pass with or without amendment, the following Resolution as an ordinary Resolution:

“Subject to Resolutions 1, 2, 3, 4, 5, 6, 7, 8 and 10 being passed, that for the purposes of Listing Rule 10.11, and for all other purposes, Shareholders approve, the allotment and issue of Shares up to $1,000,000 (being 200 million Shares) on the terms set out in the Explanatory Statement, to Peter Farris as a related party of the Company (or any entity nominated by Peter Farris).”

10 RESOLUTION 10 – SECTION 195 APPROVAL

To consider and, if thought fit, to pass, with or without amendment, the following Resolution as an ordinary Resolution:

“Conditional upon Resolutions 1, 2, 3, 4, 5, 6, 7, 8 and 9 being passed, that, for the purposes of section 195(4) of the Corporations Act and for all other purposes, Shareholders approve and authorise the Directors to complete the transactions as contemplated in this Notice.”

VOTING BY PROXY

To vote by proxy, please complete and sign the enclosed Proxy Form and return to the Company’s share registry as follows:

By Mail By Fax Computershare Investor 1800 783 447 (within Australia) or Services Pty Limited +61 3 9473 2555 (outside Australia) GPO Box 242 Melbourne, Victoria 3001

Please note that a duly completed Proxy Form and (where applicable) any power of attorney or a certified copy of the power of attorney, must be received by the Company’s share registry not later than 10.00am (WST) on 13 January 2012.

Proxy Forms received later than this time will be invalid.

ENTITLEMENT TO ATTEND AND VOTE

The Company may specify a time, not more than 48 hours before the General Meeting, at which a “snap-shot” of Shareholders will be taken for the purposes of determining Shareholder entitlements to vote at the meeting.

The Company’s Directors have determined that all Shares of the Company that are recorded on the Company’s register of members at 4.00pm (WST) on 13 January 2012 shall, for the purposes of determining voting entitlements at the General Meeting, be taken to be held by the persons registered as holding the Shares at that time.

Dated this 17[th] day of December 2012

By order of the Board of Directors

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Shannon Coates

Company Secretary

EXPLANATORY STATEMENT

Introduction

This Explanatory Statement has been prepared for the information of Shareholders of the Company to better understand the Resolutions to be put to the General Meeting to be held at Ground Floor, 3 Richardson Street, West Perth, Western Australia 6005 on 15 January 2013 at 10.00am WST.

Background to the Resolutions

On 16 May 2012, the Company, DCM, Investmet and Stirling Resources entered into a conditional agreement pursuant to which Investmet agreed, amongst other things, to restructure and recapitalise the Company ( Restructure Deed as amended and restated by the parties in November 2012). A summary of the material terms of the Restructure Deed is set out in Annexure A.

This Restructure Deed is part of a larger proposed transaction which involves the restructure and recapitalisation by Investmet of Swan Gold. The restructure and recapitalisation of the Company and Swan Gold are inter-conditional. Accordingly, even if the Resolutions under this Notice are approved, it is possible, if Swan Gold does not receive the necessary Shareholder approvals for its restructure and recapitalisation that the restructure of the Company as contemplated by this Notice of Meeting and Explanatory Statement will not occur.

To effect this larger proposed transaction, Investmet has also entered into the Swan Gold Restructure Deed. The Restructure Deed and the Swan Gold Restructure Deed together constitute the Restructure Documents. The material terms of the Restructure Deed and the Swan Gold Restructure Deed are set out in Annexure A and B respectively. Each of these Restructure Documents is a Transaction Document. It is a condition of each of the Restructure Documents that Swan Gold and the Company obtain all shareholder approval required by each of them to implement the transactions contemplated by the Transaction Documents. Further, Completion of the Restructure Deed and each of the Transaction Documents is conditional upon the Completion of each of the other Transaction Documents. Accordingly, if the shareholders of Swan Gold do not approve the various Resolutions being put to them respectively to effect the transactions under the Transaction Documents, it is possible, even if the Resolutions under this Notice are approved, that the transactions contemplated in this Notice will not proceed.

Despite the inter-conditionality of the Transaction Documents, the parties to the Transaction Documents retain the ability to waive the conditions, and, as such, it is also possible that the transactions contemplated in this Notice will proceed notwithstanding the failure of certain Resolutions by the shareholders of Swan Gold to otherwise be approved. In the event that this would occur and the Company obtains the required shareholder approval, then the Company would proceed to carry out the Placement and be reinstated to trading. The status quo of the Company would accordingly continue. In this circumstance, the Company does not consider that the de-linking of the transactions would have a material adverse effect on the Company or its Shareholders.

As at the date of this Explanatory Statement, the Company and Investmet have entered into a secured loan arrangement for total interim funding from Investmet to the Company of up to $1,500,000 for working capital purposes (further details of this convertible loan are set out in Section 1 below). If the transactions contemplated by the Transaction Documents complete, any interim funding will convert into ordinary shares in the Company at the placement price of $0.005. The number of Shares issued under the Placement will be reduced by the number of Shares issued under the loan arrangements.

If the Resolutions are not passed and the transactions contemplated by the Transaction Documents do not complete, any interim funding provided by Investmet will become repayable. Without the

cash injection from the Placement and the obligation to repay any funding to Investmet, there is significant doubt that the Company will be able to continue as a going concern.

About Investmet

Investmet is an unlisted public company managed by experienced industry professionals and supported by private high net worth investors (including its directors and management).

Investmet was created to pursue a variety of investment opportunities in mineral resource projects with strong future demand growth and to incubate, develop and enhance the value of these investments through financial, technical and corporate support.

Michael Fotios is a Geologist specialising in Economic Geology with 27 years extensive experience in exploration throughout Australia for gold, base metals, tantalum, tin and nickel and taking projects from exploration to feasibility. He previously held positions with Homestake Australia Limited and Sons of Gwalia Limited. He was Managing Director and a Director with Tantalum Australia NL (now ABM Resources Ltd) from September 1999 to October 2005. His last position was as Managing Director of Galaxy Resources Limited. Michael Fotios is founder and current Executive Chairman of Investmet. He is also currently a director of listed Northern Star Resources Ltd, Pegasus Metals Ltd, General Mining Corporation Limited and Swan Gold Mining Limited.

Peter Farris is a well respected and highly credentialed businessman in the Perth real estate industry and corporate advisory services. He has managed and developed major companies and has extensive experience in company management. Peter holds a Diploma in Business from Perth Tech and a Diploma in Business from RMIT and is a Member of the Australian Institute of Company Directors. Peter is a director of Investmet and Swan Gold Mining Limited.

Resolutions

At the Meeting, Shareholders will be asked to pass Resolutions approving:

(Resolution 1) the issue of up to a total of 1 billion Shares at $0.005 to Investmet as underwriter of the Placement or 2 billion Shares at $0.005 as underwriter (to the extent of up to 1 billion Shares) and placee or to Michael Fotios (or nominees controlled by Michael Fotios) or their respective Associates (to the extent that such securities are not issued to sophisticated investors in accordance with Resolution 2);
(Resolution 2) the issue of up to 2 billion Shares at $0.005 each to sophisticated investors (to the extent that such securities are not issued to Investmet or Associates of Investmet in accordance with Resolution 1);
(Resolution 3) the potential acquisition by Investmet Limited, Michael Fotios or their respective Associates of a relevant interest in 68,876,665 Shares, being the Shares held by Stirling Resources (through its wholly owned subsidiary, Stirling Copper) and representing approximately 17.5% of the issued capital of the Company (prior to the Placement) which are proposed to be transferred by Stirling Resources to Investmet under the Group Restructure;
(Resolution 4) the issue of Shares to Stirling Resources to extinguish a debt of up to $890,000 owed to Stirling Resources;
(Resolution 5) the issue of Placement securities to Damian Delaney (or his nominees);
(Resolution 6) the issue of Placement securities to Martin Depisch (or his nominees);
(Resolution 7) the issue of Placement securities to Thomas Styblo (or his nominees);
(Resolution 8) the issue of Placement securities to Gerhard Kornfeld(or his nominees);
(Resolution 9) the issue of Placement securities to Peter Farris (or his nominees); and

(Resolution 10) that the Directors complete the transactions as contemplated under the Notice.

It is important for Shareholders to note that Resolution 2 seeks Shareholder approval as an alternative to Resolution 1, for allotments of up to 2 billion Shares in aggregate to sophisticated investors (who are not Associates of Investmet). Accordingly, the 2 billion Shares for which Shareholder approval is being sought by Resolution 2 are the same 2 billion Shares for which Shareholder approval is being sought by Resolution 1.

It is important for Shareholders to also note that Resolutions 1, 2, 3, 4, 5, 6, 7, 8, 9 and 10 are interconditional. Accordingly, Resolutions 1, 2, 3, 4, 5, 6, 7, 8, 9 and 10 will not have effect unless and until Resolutions 1, 2, 3, 4, 5, 6, 7, 8, 9 and 10 are each passed.

Business of the Company post transaction

The proposed allotment will raise new capital of up to $10,000,000 before the costs of the issue for the Company. The transaction will provide funding for working capital purposes and for an initial exploration period to firm up the known resources at the Redbank Copper Project ( Project ) in the McArthur Basin region situated in the Northern Territory of Australia. Please see section 1.2 for a detailed breakdown of the use of funds and further details relating to the Project.

Independent Expert

Resolutions 1 and 3 require Shareholder approval under Item 7 of section 611 of the Corporations Act, as the transaction the subject of that Resolution may result in Investmet and its Associates increasing their Voting Power in the Company to more than 20% and the Resolutions propose the issue of securities to a related party of the Company (namely Investmet and/or its Associates).

The Company has engaged Stantons International Securities to prepare an Independent Expert’s Report to opine on whether the transactions the subject of Resolutions 1 and 3 are fair and reasonable to Shareholders entitled to vote on the Resolution in the context of Resolutions 1 to 10 which are inter-conditional. A copy of that report is attached as Annexure E to this Notice of Meeting which Shareholders should read in full. The Independent Expert’s Report is also available via the Company’s website: www.redbankcopper.com.au. Upon request from a Shareholder, the Company will send a copy of the Independent Expert’s Report to that Shareholder’s address as recorded in the Company share register, at no cost to that Shareholder. The Independent Expert has concluded that the transactions the subject of Resolutions 1 and 3 are “fair and reasonable” to Shareholders entitled to vote on Resolutions 1 and 3.

Board Recommendation

Other than Martin Depisch, Michael Fotios and Peter Farris who have a material personal interest in the outcome of Resolutions 1 and 3, the Directors recommend that the Shareholders vote in favour of Resolutions 1 and 3. The Directors consider that the proposed transactions are a positive outcome for the Company and with the support of Investmet, the Company will make a significant step towards a substantial recapitalisation and re-quotation of the Company’s Shares on the ASX.

This Explanatory Statement and the Independent Expert’s Report provide information that the Board believes to be material to Shareholders in deciding whether or not to pass these Resolutions. The Directors recommend that Shareholders read this Explanatory Statement and the Independent Expert’s Report in full before making any decision in relation to the Resolutions.

1 RESOLUTIONS 1 AND 3 – APPROVAL OF PLACEMENT TO INVESTMET AS UNDERWRITER OR PLACEE, MICHAEL FOTIOS AND THEIR REPSECTIVE ASSOCIATES AND ACQUISITION OF RELEVANT INTEREST IN SHARES HELD BY STIRLING RESOURCES (HELD BY ITS WHOLLY OWNED SUBSIDIARY, STIRLING COPPER)

Investmet has agreed to provide the Company with $5,000,000 of new funding by way of partially underwriting a sophisticated investor placement (the Placement ) of up to 2,000,000,000 Shares at a price of $0.005 each (the Placement Shares ) to raise up to $10 million. Investmet may also participate in the Placement as placee. Any sophisticated investors or placees however will participate in the Placement in first instance and will be given priority over Investmet’s participation as underwriter. The underwriting agreement to be entered into by Investmet and the Company will be on standard terms and the underwriting fee will be 6% of funds raised.

The Placement Shares will rank equally in all respects with all of the existing ordinary shares on issue. No placement, corporate advisory fee or other capital raising fees are applicable to the Placement other than the 6% fee referred to above. Any fees payable to Azure Capital as lead manager will be paid out of the 6% fee payable to Investmet.

As announced to the ASX on 7 August 2012, the Company has also entered into a secured loan agreement with Investmet, for an amount up to $1,500,000, for the purpose of funding the Company’s working capital requirements ( Investmet Loan ).

If the transactions contemplated by the Transaction Documents complete, any interim funding pursuant to the Investmet Loan will convert into ordinary Shares in the Company at the placement price of $0.005. The number of Shares issued under the Placement will be reduced by the number of Shares issued upon conversion of the Investmet Loan.

If Resolutions 1 to 10 are not passed and the transactions contemplated by the Transaction Documents do not complete, any interim funding provided by Investmet will become repayable. Without the cash injection from the Placement and the obligation to repay any funding to Investmet, there is significant doubt that the Company will be able to continue as a going concern.

The terms and conditions of the Investmet Loan provide that any amounts drawn down under the loan will automatically convert into Shares, issued at $0.005 (the same price as under the Placement), if the transactions contemplated by the Transaction Documents complete. The material terms and conditions of the Investmet Loan are set out below:

(a) (Loan) : Investmet has agreed to make available to the Company a secured facility of $1,500,000. Amounts drawn down must be used for approved purposes.
(b) (Security) : the Company and Redbank Operations Pty Ltd (a wholly owned subsidiary) have granted a security interest in and over its personal property and a fixed charge over all of its other property to Investmet to secure the amounts drawn down under the Investmet Loan.

(c) (Conversion) : in the absence of any event of default, any amounts outstanding under the Investmet Loan will automatically convert into Shares if the transactions contemplated by the Transaction Documents complete. The number of Shares which Investmet will be entitled to on conversion of all or part of the amount drawn down under the Investmet Loan is calculated by dividing the amount being converted by $0.005. The Shares issued and allotted on conversion will rank equally with all existing Shares of the Company. The total amount raised by the Company under the Placement will be reduced to the extent any amounts lent under the Investmet Loan are converted by Investmet into Shares.
(d) (Repayment) : In the absence of an event of default or conversions of any advance, the Company must repay each advance borrowed by the Company which is outstanding on the maturity date being 28 February 2013.
(e) (Interest) : Interest is payable on the principal amount of each advance borrowed at 10% per annum. Any interest due will be capitalized daily and added to the Investmet Loan.
(f) (Default and Termination) : If an event of default occurs, and the Loan has not been converted into Shares, the Company must repay the Loan within 5 Business Days of Investmet issuing a written notice requiring repayment. The events of default are set out in the ASX announcement made by the Company on 7 August 2012 and are customary for a transaction of this nature.

Investmet and its Associates including Michael Fotios (or nominees controlled by Michael Fotios) will also acquire a Relevant Interest in 68,876,665 Shares, if the transactions contemplated by the Restructure Deed in relation to Stirling Resources complete.

1.1 Corporations Act requirements

Under Resolutions 1 and 3, the Company seeks Shareholder approval in accordance with Item 7 of section 611 of the Corporations Act from Shareholders for the issue of up to 2 billion Placement Shares to, and the acquisition of a Relevant Interest in 68,876,665 Shares by, Investmet and/or its Associates (including Michael Fotios (or nominees controlled by Michael Fotios). This is because:

(a) Investmet will acquire a Relevant Interest in the Placement Shares which Investmet subscribes for under Resolution 1 as well as upon the acquisition of 68,876,665 Shares from Stirling Resources by Investmet referred to in Resolution 3. Investmet’s Voting Power will also include the Relevant Interest of any of its Associates.
(b) Associates of Investmet may acquire a Relevant Interest in the Placement Shares which they subscribe for under Resolution 1. The Voting Power of Investmet’s Associates will also include the Relevant Interest of Investmet.
(c) If all or part of the Investmet Loan is converted into Shares, Investmet will acquire a Relevant Interest in the Shares issued upon conversion of the Investmet Loan.
(d) Under section 608(3) of the Corporations Act a person is deemed to have a Relevant Interest in securities that any of the following has:
(i) a body corporate in which the person’s voting power is above 20%; or
(ii) a body corporate that the person controls.

As Michael Fotios holds more than 20% of Investmet, Michael Fotios will be deemed to have a relevant interest in any Shares in which Investmet has a relevant interest.

Neither Investmet, Michael Fotios nor their respective Associates currently hold a Relevant Interest in any Shares.

As a result of Resolutions 1 and 3 being put to the Meeting, passed and implemented, the Voting Power of each of Investmet, Michael Fotios and each of their respective Associates may exceed 20% in breach of section 606 of the Corporations Act.

Under section 606 of the Corporations Act, a person must not acquire a Relevant Interest in issued voting shares of a company if because of the transaction that person’s or someone else’s Voting Power increases from:

(a) 20% or below to more than 20%; or
(b) a starting point that is above 20% and below 90%.

Under Item 7 of section 611 of the Corporations Act, section 606 of the Corporations Act does not apply in relation to any acquisition of shares in a company approved by a resolution passed at a general meeting of the company at which no votes were cast in favour of the resolution by the acquirer or the disposer or their respective Associates.

Resolutions 1 and 3 seek Shareholder approval for this potential increase in Voting Power for each of Investmet and Investmet’s Associates under section 611 of the Corporations Act arising out of their respective subscriptions for Placement Shares and the acquisition of a Relevant Interest in 68,876,665 Shares under the transactions contemplated by the Restructure Deed in relation to Stirling Resources.

In order for the Company to comply with the requirements of the Corporations Act, the Company has provided the information below which ASIC Regulatory Guide 74 requires the Company to provide to Shareholders when seeking approval in accordance with Item 7 of section 611 of the Corporations Act.

1.2 Information required by section 611 item 7 of the Corporations Act and ASIC Regulatory Guide 74

Identity of the persons proposing to make the acquisition, their associates and Relevant Interests

Investmet is an unlisted public company managed by experienced industry professionals and supported by private high net worth investors (including its directors and management).

Investmet has advised that it intends to recapitalise the Company and provide sufficient funding to complete a review into the recommencement of operations of the Company’s projects.

Investmet and Michael Fotios (who is deemed to have the same relevant interest as Investmet by virtue of section 608(3) of the Corporations Act) and the following Associates of Michael Fotios are the persons proposing to make the acquisition of securities in relation to the Placement in Resolution 1 and under the transactions contemplated by the Restructure Deed in relation to Stirling Resources the subject of Resolution 3:

Investmet up to 2,068,876,665 Shares Michael Fotios (and/or Delta Resource Management Pty Ltd) up to 2,068,876,665 Shares

The acquisitions in Resolutions 1 and 3 will result in an increase in Voting Power of Investmet, Michael Fotios and Delta Resource Management Pty Ltd.

The maximum extent of the increase in the Voting Power in the Company that would result from the issue and acquisition of the Shares

As at the date of this Notice, Investmet does not have a Relevant Interest in any Shares of the Company. In the event that Resolutions 1 and 3 of this Notice are passed and implemented (and all other Resolutions contained in this Notice are passed) Investmet’s Relevant Interest and Voting Power in the Company may potentially increase to a maximum of 86.47%. In the event that Resolutions 1 and 3 of this Notice are passed and if Investmet were to subscribe for the Shares the subject of its underwriting commitment (that is, 1 billion Shares and assuming the Placement was limited to 1 billion Shares), Investmet and Michael Fotios would have a relevant interest in 76.75% of the Shares.

The following table sets out the Voting Power of Investmet in the event that Investmet were to take up all of the Shares under the Placement (assuming that all Resolutions contained in this Notice are passed and that the Company elects to repay the debt of $890,000 currently owed to Stirling Resources in cash rather than through the issue of Shares referred to in Resolution 4).

Increase in Voting Power of Investmet, Michael Fotios and their Associates caused by implementation of:	Number of Shares in relation to which Investmet, Michael Fotios and their Associates has Voting Power relevant to each Resolution (and the proposed underwriting)	Total number of Shares on issue	Percentage Voting Power of Investmet and its Associates
As at date of Notice of General Meeting	0	392,630,263	0.00%
Issue of Shares under Resolution 1 (assuming all 2,000,000,000, including Shares issued in relation to the conversion of the Investmet Loan, are issued to Investmet and its Associates)	2,000,000,0001	2,392,630,263	83.59%
Completion of transaction contemplated by the Restructure Deed in relation to Stirling Resources the subject of Resolution 3	2,068,876,6651)	2,392,630,263	86.47%

Effect of Placement on control

As at the date of this Notice, each of Investmet and Michael Fotios do not have a Relevant Interest in any Shares of the Company. If each of the Resolutions contained in this Notice are passed and implemented, Investmet’s and Michael Fotios’ Relevant Interest and Voting Power in the Company may potentially increase to a maximum of 86.47%. Accordingly, if

1 Investmet is only obliged to underwrite the issue of 1 billion Shares under the Placement but will have the right to subscribe for up to 2 billion Shares if all of the Resolutions are approved.

the Placement is undertaken, then this will have a material effect on the control of the Company.

However, it is unlikely that no sophisticated investors will take up Shares under the Placement, as contemplated by Resolution 2. Accordingly, the table below sets out the Voting Power of Investmet and its Associates based on a number of scenarios in which Investmet and its Associates take up different proportions of Shares under the Placement (assuming that all of the Resolutions contained in this Notice are passed).

Percentage take up under Placement by Investmet, Michael Fotios and their Associates	Shares (taken up by Sophisticated Investors who are not Associates of Investmet or Michael Fotios)	Shares held by Investmet, Michael Fotios and their Associates post Placement	Total Shares on issue	Voting Power of Investmet and Associates of Investmet post Placement
0	2 billion	68,876,665	2,392,630,263	2.88%
25	1.5 billion	568,876,665	2,392,630,263	23.78%
50	1 billion	1,068,876,665	2,392,630,263	44.67%
75	500 million	1,568,876,665	2,392,630,263	65.67%
100	0	2,068,876,665	2,392,630,263	86.47%

Identity, associations with the associates and qualifications of any person who is intended to or will become a Director if the Shareholders agree to the allotment

Michael Fotios, Damian Delaney and Peter Farris are directors of the Company. A brief resume of Michael Fotios is included in this Explanatory Statement in the ‘Background to the Resolutions’. Peter Farris is a director of, and a minority shareholder of, Investmet and Damian Delaney is a consultant to, and a minority shareholder of, Investmet but they (along with Michael Fotios) are not considered to be Associates of Investmet.

Statement of associated parties’ respective intentions regarding the future of the Company if Shareholders pass Resolutions 1 to 10

Investmet’s proposed involvement will recapitalise the Company allowing it to continue to pursue its objective of exploration after re-quotation of the Company’s Shares on the ASX and recapitalisation of the Company.

The strategic focus of the Company will be an initial exploration period to firm up the known resources at the Redbank Copper Project in the McArthur Basin region situated in the Northern Territory of Australia.

The significant ground position of over 3,600 km[2] includes numerous advanced copper targets and has an estimated previously identified resource of over 90,000 tonnes of contained copper metal. The Project already has an established mine and support infrastructure currently on care and maintenance which gives the Redbank Copper Project a significant head start against other similar projects.

The initial focus will be on exploration drilling, targeting a resource in excess of 200,000 tonnes of contained copper metal. Development and feasibility work will then follow the establishment of a JORC defined resource.

Other than as disclosed elsewhere in this Explanatory Statement, the Company understands that Investmet and Associates of Investmet:

(a) have no intention of making any significant changes to the business of the Company;
(b) do not intend to change the financial or dividend policies of the Company;
(c) have no intention of injecting further capital into the Company;
(d) have no intention of making changes regarding the future employment of the present employees of the Company;
(e) do not intend to redeploy any fixed assets of the Company; and
(f) do not intend to transfer property between the Company and Investmet.

These intentions are based on information concerning the Company, its business and the business environment which is known to Investmet at the date of this document.

Final decisions regarding these matters will only be made by Investmet in light of material information and circumstances at the relevant time. Accordingly, the statements set out above are statements of current intention only, which may change as new information becomes available to it or as circumstances change.

Particulars of the proposed acquisitions and timing

The terms of the Shares the subject of Resolution 1 are set out in Annexure D. The Shares the subject of Resolution 1 will be issued no later than 3 months following the General Meeting. The acquisition of a Relevant Interest in 68,876,665 Shares the subject of Resolution 3 will occur if the transactions contemplated by the Restructure Deed in relation to Stirling Resources complete.

An explanation of the reasons for the proposed allotment

The proposed allotment will raise new capital of up to $10,000,000 before the costs of the issue for the Company and will provide funding for working capital purposes and for an initial exploration period to firm up the known resources at the Redbank Copper Project in the McArthur Basin region situated in the Northern Territory of Australia. The use of funds of the Placement is as follows on the basis of a minimum raising of $7.5 million and a maximum raising of $10 million:

Proceeds of the Issue	Minimum raising of $7.5 million2 $000’s	Maximum raising of $10 million3 $000’s

Exploration	1,780	2,583
Mine Development (including Feasibility)	N/A	1,200
Repayment of Debt4	3,500	3,500
Corporate and Administration	554	854
Working Capital	197	194
Payment of creditors	869	869
Costs of Placement	600	800
TOTAL	$7,500	$10,000

The interests of the Directors in Resolutions 1 and 3

Director	Relevant Interest in Shares as at date of Notice of General Meeting	Relevant Interest in Shares as at date of Notice of General Meeting	Relevant Interest in Shares following implementation of Resolutions 1 and 3	Relevant Interest in Shares following implementation of Resolutions 1 and 3
	Directly held	Indirectly held	Directly held	Indirectly held
Mr Martin Depisch (Non-executive Director)	0	0	0	0
Dr Gerhard Kornfeld (Non-executive Director)	0	0	0	0

2 The Company intends to include a minimum subscription condition of $7.5 million (or other amount which will satisfy any financial condition imposed by the ASX in order for the Shares to be re-quoted on the ASX) in the Placement, $5 million of which will be underwritten by Investmet.

3 Shareholders should note that only $5 million of the Placement is underwritten and there is no guarantee that the Company will be able to raise the full $10 million.

4 The Company currently owes DCM approximately $3.4 million and is obliged under the Restructure Deed to repay this amount at Completion and this will amount to approximately $3.5 million at Completion including interest). This assumes that the Company will elect to convert the debt owed to Stirling Resources of approximately $890,000 into Shares.

Mr Michael Fotios (Non-executive Director)	0	0	up to 2,068,876,665 Shares	up to 2,068,876,66 5 Shares
Mr Peter Farris (Non-executive Director)	0	0	0	0
Mr Damian Delaney (Non-executive Director)	0	0	0	0
Mr Thomas Styblo (Non-executive Director)	0	0	0	0

The identity of Directors who approved or voted against the Resolution

Other than Martin Depisch, Michael Fotios and Peter Farris, who were not entitled to vote due to a material personal interest, all of the Directors approved the Resolution.

1.3 Listing Rule 10.11 requirements

Shareholder approval is sought under Listing Rule 10.11 as Resolution 1 proposes the issue of the Placement Shares to a related party of the Company, namely Michael Fotios (or nominees controlled by Michael Fotios), who is a Related Party of the Company by virtue of his proposed appointment as a Director, therefore satisfying the Related Party test set out in section 228 of the Corporations Act. Given Michael Fotios will be participating in the Placement on the same arm’s length terms as parties who are not related parties of the Company, the Board considers that Chapter 2E of the Corporations Act does not apply.

Information requirements for Listing Rule 10.11

(a) Up to 2 billion Placement Shares are to be issued to Michael Fotios (or nominees controlled by Michael Fotios). The maximum number of Shares under Resolution 1 or 2 that will be issued is 2 billion.
(b) The Company will issue the Placement Shares no later than 1 month after the date of the Meeting (or such longer period of time as ASX in its discretion allows).
(c) The Placement Shares will be issued at a price of $0.005 each, raising $10 million in funds for the Company and will provide funding for working capital purposes and for an initial exploration period to firm up the known resources at the Redbank Copper Project in the McArthur Basin region situated in the Northern Territory of Australia.
(d) The terms and conditions of the Placement Shares are set out in Annexure D. The Placement Shares will be issued on the same terms as the existing ordinary shares on issue and will rank equally in all respects with all of the existing ordinary shares on issue.
(e) A voting exclusion statement is included in the Notice of General Meeting.

Pro Forma Balance Sheet

An unaudited pro-forma balance sheet of the Company’s balance sheet as at 30 June 2012 as a result of the transaction is set out in the Independent Expert’s Report.

Directors’ recommendation

Other than Martin Depisch, Michael Fotios and Peter Farris who have a material personal interest in the outcome of Resolutions 1 and 3, the Directors recommend that the Shareholders vote in favour of Resolutions 1 and 3. The Directors consider the Placement will allow for the successful recapitalisation of the Company to be undertaken and requotation of the Company’s Shares on the ASX.

Whether proposal is fair and reasonable

The Directors have appointed Stantons International Securities as Independent Expert and commissioned them to prepare an Independent Expert’s Report to provide an opinion as to whether or not the proposal in Resolutions 1 and 3 are fair and reasonable to the Shareholders. The report is set out in Annexure E and it is recommended that Shareholders read that report in its entirety.

Stantons International Securities have concluded that the proposed transaction the subject of Resolutions 1 and 3 is “fair and reasonable” to non-associated Shareholders, taking into account that Resolutions 1, 2, 3, 4, 5, 6, 7, 8, 9 and 10 are inter-conditional on each other. The Company strongly recommends that you read the report set out in Annexure E in full.

2 RESOLUTION 2 – APPROVAL OF PLACEMENT OF SECURITIES TO SOPHISTICATED INVESTORS

As set out above in Section 1, Investmet has agreed to underwrite $5,000,000 of the Placement to raise up to $10,000,000 of new funding for the Company.

Accordingly, Resolution 1 is seeking approval under Item 7 of section 611 of the Corporations Act and Listing Rule 10.11 for Investmet, Michael Fotios and their respective Associates, to participate in the Placement, through the issue to them of the Placement Shares at a price of $0.005 each.

Notwithstanding this, and as noted in Section 1, part or all of the issue of securities under the Placement may be made by the Company to placees that are not Associates of Investmet or Michael Fotios. To the extent all or part of the Placement is made to placees that are not Associates of Investmet or Michael Fotios, the approval sought under Resolution 1 will not apply for purposes of Listing Rule 7.1. Accordingly, Resolution 2 seeks Shareholder approval as an alternative to Resolution 1, for allotments (up to 2 billion Shares in aggregate) to placees who are not Associates of Investmet or Michael Fotios. The 2 billion Shares in respect of which Shareholder approval is being sought by Resolution 2 are the same 2 billion Shares for which Shareholder approval is being sought by Resolution 1.

The issue of the Placement Shares will in aggregate be equal to approximately 83.59% of the Company’s fully-diluted Share capital assuming implementation of all the Resolutions (based on the number of Shares on issue as at the date of this Notice of General Meeting), and will result in a total of 2,392,630,263 Shares being on issue. Further details of the increase in Voting Power arising in respect of the Resolutions are set out in section 1.2 above. Further details of the Company’s capital structure are set out in Annexure C.

Currently the Company owes Stirling Resources approximately $890,000. If the transaction contemplated by the Restructure Documents completes, this debt will be repaid or converted into Shares (on a $0.005 per Share basis) at the election of the Company. The approval for the conversion of the debt into Shares is covered by Resolution 4.Listing Rule 7.1 provides generally that a company may not issue shares equal to more than 15% of the company’s issued share capital in any 12 months without obtaining shareholder approval. Accordingly, approval is being sought under Listing Rule 7.1 for the issue of the Placement Shares to the extent they are issued to nominees of Investmet that are not Associates of Investmet.

Information required by Listing Rule 7.3 for approval under Listing Rule 7.1:

(a) The maximum number of Shares that will be issued is up to 2 billion.
(b) The 2 billion Shares are to be issued on one date and not on successive dates, and in any event no later than 3 months after the date of Shareholder approval.
(c) The 2 billion Shares will be allotted and issued at a price of $0.005 each, raising up to $10,000,000 in funds. The allottees will be sophisticated investors, who are not Associates of Investmet or Michael Fotios.
(d) The terms and conditions of the Shares are set out in Annexure D. The Shares will be issued on the same terms as the existing ordinary shares on issue and will rank equally in all respects with all of the existing ordinary shares on issue.

(e) Funds raised from the issue of the Shares will be used for working capital purposes and for an initial exploration period to firm up the known resources at the Redbank Copper Project in the McArthur Basin region situated in the Northern Territory of Australia.
(f) A voting exclusion statement is included in the Notice of General Meeting.

Other than Martin Depisch, Michael Fotios and Peter Farris, who have a material personal interest in the outcome of Resolution 2, the Directors recommend that the Shareholders vote in favour of Resolution 2. The Directors consider the Placement will allow for the successful recapitalisation of the Company to be undertaken and re-quotation of the Company’s Shares on the ASX.

3 RESOLUTION 4 – APPROVAL OF ISSUE OF SECURITIES TO STIRLING RESOURCES

Listing Rule 7.1 provides generally that a company may not issue shares equal to more than 15% of the company’s issued share capital in any 12 months without obtaining shareholder approval. Accordingly, approval is being sought under Listing Rule 7.1 for the issue of Shares to Stirling Resources.

Information required by Listing Rule 7.3 for approval under Listing Rule 7.1:

(a) The maximum number of Shares that will be issued is up to 178 million.
(b) The Shares are to be issued on one date and not on successive dates, and in any event no later than 3 months after the date of Shareholder approval.
(c) The Shares will be allotted and issued at a nominal price of $0.005 each for the purpose of extinguishing the debt of $890,000 owed by the Company to Stirling Resources. The allottee will be Stirling Resources.
(d) The terms and conditions of the Shares are set out in Annexure D. The Shares will be issued on the same terms as the existing ordinary shares on issue and will rank equally in all respects with all of the existing ordinary shares on issue.
(e) No funds will be raised from the issue of the Shares but the liability of approximately $890,000 owed by the Company to Stirling Resources will be extinguished.
(f) A voting exclusion statement is included in the Notice of General Meeting.

Other than Martin Depisch, Gerhard Kornfeld and Thomas Styblo, who have a material personal interest in the outcome of Resolution 4, the Directors recommend that the Shareholders vote in favour of Resolution 4. The Directors consider the issue of Shares will assist with the successful recapitalisation of the Company and re-quotation of the Company’s Shares on the ASX.

4 RESOLUTIONS 5, 6, 7, 8 AND 9 – APPROVAL OF PLACEMENT SECURITIES TO RELATED PARTIES (OR THEIR NOMINEES)

4.1 Background

Shareholder approval is required in order to comply with the regulatory requirements of Listing Rule 10.11 and Chapter 2E of the Corporations Act for any Shares issued to related parties (or their nominees).

Accordingly, Resolutions 5, 6, 7, 8 and 9 seek Shareholder approval for the issue of Shares to the Directors (or their nominees other than Michael Fotios) as related parties of the Company for the purposes of Listing Rule 10.11 and Chapter 2E of the Corporations Act, for allotments up to $1,000,000 (being 200 million Shares) each of the Company to related parties (or their nominees).

The number of Shares to be issued to each related party is based on the number specified by each related party in their subscription for the relevant tranche of Shares. To the extent that the issue of the relevant tranche of Shares is made to the related parties, this will constitute part of the 2 billion Shares approved by Shareholders under Resolution 1 and 2.

4.2 Listing Rules and Corporations Act

Given that the proposed allottees of Shares under Resolutions 5, 6, 7, 8 and 9 are related parties to the Company, the resolution seeks Shareholder approval to comply with the regulatory requirements of Listing Rule 10.11 and Chapter 2E of the Corporations Act.

Listing Rule 10.11

Listing Rule 10.11 provides a general restriction, subject to specified exceptions, against issuing shares to a related party without shareholder approval.

Shareholder approval is required to comply with Listing Rule 10.11 since the allottees, as current or future Directors (or their nominees), are related parties of the Company.

Section 208 Corporations Act

Chapter 2E of the Corporations Act regulates the provision of financial benefits to related parties by a public company. The part of the Placement which is referred to in Resolutions 1 and 2, which is made to placees that are related parties (or their nominees), constitute the provision of a financial benefit to a related party. Section 229 of the Corporations Act includes as an example of a “financial benefit”, the issuing of securities or the granting of an option to a related party.

A “related party” is widely defined under the Corporations Act, and includes a Director of the Company and a person who may become a director of the Company. For this reason Damian Delaney, Martin Depisch, Thomas Styblo, Michael Fotios, Gerhard Kornfeld and Peter Farris are considered related parties of the Company.

Chapter 2E of the Corporations Act prohibits the Company from giving a financial benefit to a related party of the Company unless either:

the giving of the financial benefit falls within an exception to the provision; or
prior shareholder approval is obtained to the giving of the financial benefit and the benefit is given within 15 months after shareholder approval is obtained.

Given the Directors will be participating in the Placement on the same arm’s length terms as the parties who are not related parties of the Company, the Board considers that Chapter 2E of the Corporations Act does not apply.

4.3 Information Requirements for Listing Rule 10.11

(a) The Shares will be issued to Damian Delaney, Martin Depisch, Thomas Styblo, Gerhard Kornfeld and Peter Farris (or their nominees) to an amount of up to $1,000,000 (being 200 million Shares) each.
(b) The date by which the Company will issue the Shares will be not more than one month after the date of the Meeting.
(c) Damian Delaney, Martin Depisch, Thomas Styblo, Gerhard Kornfeld and Peter Farris are Directors.
(d) The Shares will be issued at an issue price of $0.005 each.
(e) The Shares issued will be fully paid ordinary Shares, issued on the same terms as the existing ordinary Shares on issue in the capital of the Company and will rank equally in all respects with the Company’s existing Shares on issue.
(f) The issue of Shares will form part of the issue referred to under Resolutions 1 and 2 and accordingly funds will be used for the purpose set out with respect to those Resolutions.

4.4 Directors’ recommendation

Michael Fotios, who does not have a material personal interest in the outcome of the Resolutions, recommends that Shareholders vote in favour of Resolutions 5, 6, 7, 8 and 9. Michael Fotios considers the Placement will allow for the successful recapitalisation of the Company to be undertaken and re-quotation of the Company’s Shares on the ASX.

5 RESOLUTION 10 – SECTION 195 APPROVAL

Section 195 of the Corporations Act provides that a director of a public company may not vote or be present during meetings of directors when matters in which that director holds a “material personal interest” are being considered.

At the time of entry into the initial Transaction Documents, each of the Directors at that time being Martin Depisch, Thomas Styblo and Lucanus Polagnoli had a material personal interest in the outcome of Resolutions 1, 2, 3, 4, 6, 7, 8 and 9. In the absence of this Resolution 10, the Directors were not able to form a quorum at Directors’ meetings necessary to carry out the terms of the Resolutions.

At the time of entry into the amended and restated Transaction Documents, each of the directors had a material personal interest in the outcome of Resolutions 1, 2, 3, 4, 6, 7, 8 and 9. In the absence of this Resolution 10, the Directors were not able to form a quorum at Directors’ meetings necessary to carry out the terms of the Resolutions.

Those Directors have accordingly exercised their right under section 195(4) of the Corporations Act to put the issue to Shareholders to resolve upon.

To avoid doubt, Resolution 10 permits the Directors to do whatever is necessary to carry Resolutions 1, 2, 3, 4, 5, 6, 7, 8 and 9 into effect.

Each of the Directors has a material personal interest in the outcome of the Resolutions and therefore are unable to recommend that the Shareholders vote in favour of Resolution 10. However, the Directors consider that the proposed transactions will allow for the successful recapitalisation of the Company to be undertaken and re-quotation of the Company’s Shares on the ASX.

6 ADDITIONAL INFORMATION

6.1 Share price

The Share price has been suspended since 24 November 2011. The last closing Share price was $0.003.

6.2 Effect on Capital Structure

The total number of Shares on issue as at the date of this Notice is 392,630,263.

The total number of Shares on issue after the Transaction completes will be 2,392,630,263.

6.3 Other material information

The Company is a "disclosing entity" for the purposes of section 111AC of the Corporations Act. As such, it is subject to regular reporting and disclosure obligations. These disclosure obligations require the Company to disclose to the ASX (ASX Code: RCP) any information that a reasonable person would expect to have a material effect on the price or value of the Company's securities.

The Company's announcements are available from www.asx.com.au and general information relating to the Company can be found on the Company's website at www.redbankcopper.com.au.

There is no other information material to the making of a decision by Shareholders whether or not to vote in favour of Resolutions 1 to 10 (being information that is known to the Directors which has not previously been disclosed to Shareholders) other than as set out in this Explanatory Statement.

GLOSSARY

In this Explanatory Statement, the following terms have the following meaning unless the context otherwise requires:

ASIC means Australian Securities and Investments Commission.

Associate has the meaning given in the Corporations Act.

ASX means ASX Limited.

Azure Capital means Azure Capital Limited ACN 107 416 106.

Board means the board of Directors.

Business Day means a day which banks are open for business in Perth and Zurich excluding a Saturday, Sunday or public holiday.

Company means Redbank Copper Limited ACN 059 326 519.

Completion means the simultaneous completion of the Group Restructure in accordance with each Transaction Document.

Constitution means the constitution of the Company.

Corporations Act means Corporations Act 2001 (Cth).

Creditors’ Trust Deed means the creditors’ trust deed dated 24 February 2010, between (among others) Swan Gold and the Trustee.

Creditors’ Trusts has the meaning given in Annexure B.

DCM means DCM DECOmetal GmbH.

Delta Resources Management Pty Ltd means Delta Resources Management Pty Ltd ACN 118 613 175.

Director means a director of the Company.

Explanatory Statement means this Explanatory Statement.

Group Restructure means the restructuring and recapitalisation of the Restructure Entities and their subsidiaries in accordance with the Transaction Documents.

Group Trust means the Group Trust constituted under the Creditors’ Trust Deed.

Independent Expert means Stantons International Securities.

Independent Expert’s Report means the report prepared by the Independent Expert contained in Annexure E.

Investmet means Investmet Limited ACN 125 585 935.

Investmet Loan means the loan made by Investmet to the Company for up to $1.5 million in accordance with the loan agreement between Investmet, the Company and Redbank Operations Pty Ltd undated as amended.

La Jolla Agreement means the agreement between La Jolla Cove Investors Inc. (La Jolla) and Stirling Resources dated 4 December 2009.

Listing Rules means the ASX Listing Rules.

Loan Syndicate Arrangements means the loan arrangements intended to be established by DCM and Investmet with third party financiers (if any) and some or all of the Restructure Entities and their Subsidiaries, to include fixed and floating charges over their respective

assets, to regulate secure debts over the Restructure Entities (and their Subsidiaries (if applicable)) and their respective assets.

Meeting or General Meeting means the meeting convened by this Notice.

MGMC Trustee Deed Poll means the deed poll by the Trustee as trustee of the Group Trust, the Mt Ida Trust and the Territory Trust dated 30 May 2012.

Mt Ida Trust means the Mt Ida Trust constituted under the Creditors’ Trust Deed.

Notice or Notice of General Meeting means the notice of meeting that accompanies this Explanatory Statement.

Options mean options in the Company.

Placement means the raising of up to $10 million through the placement of 2 billion Shares to Investmet, Michael Fotios and/or their respective Associates and/or professional or sophisticated investors in accordance with Resolutions 1 and 2.

Placement Shares means up to 2 billion Shares the subject of the Placement.

Proxy Form means the proxy form enclosed with this Notice and Explanatory Statement.

Recapitalisation Deed means the recapitalisation deed between the Trustee, Swan Gold and others dated 21 June 2009.

Related Party is defined in section 228 of the Corporations Act.

Relevant Interest has the meaning given in the Corporations Act.

Resolution means a resolution referred to in the Notice.

Restructure Deed means the Redbank Copper Restructure Deed between DCM, Investmet, the Company and Stirling Resources, dated 16 May 2012 as amended and restated in November 2012.

Restructure Documents means each of the Restructure Deed and the Swan Gold Restructure Deed.

Restructure Entities means the Company and Swan Gold.

Share means an ordinary share in the capital of the Company.

Shareholder means a shareholder of the Company.

Share Sale Agreement has the meaning given in Annexure B.

Stantons International Securities means Stantons International Audit and Consulting ACN 144 581 519.

Stirling Copper means Stirling Copper Pty Ltd ACN 134 037 497.

Stirling Resources means Stirling Resources Limited ACN 009 659 054.

Subsidiary has the meaning given to that term in section 9 of the Corporations Act.

Swan Gold means Swan Gold Mining Limited ACN 100 038 266.

Swan Gold Restructure Deed means the Swan Gold Restructure Deed between DCM, Investmet and Swan Gold dated 16 May 2012 as amended and restated in November 2012.

Swan Gold Restructure Deed Warranties has the meaning given in Annexure B.

Territory Trust means the Territory Trust constituted under the Creditors’ Trust Deed.

Transaction Documents means the following documents entered into to effect the restructure of Swan Gold and the Company:

(a) the Restructure Documents;
(b) the loan agreement for the Investmet Loan;
(c) the loan agreement between Investmet and Swan Gold undated as amended;
(d) MGMC Trustee Deed Poll; and
(e) any other document or agreement effecting the Group Restructure, which Investmet and DCM notify in writing to the Company and others as being a Transaction Document.

Trustee means MGMC Pty Ltd ACN 137 763 510.

Voting Power has the meaning given in the Corporations Act.

WST means Western Standard Time, Perth, Western Australia.

$ means Australian dollars.

A reference to a Section or an Annexure is a reference to a Section or Annexure in this Explanatory Statement.

ANNEXURE A – MATERIAL TERMS OF THE RESTRUCTURE DEED

Material terms of the Placement

(a) The Company agrees to undertake a Placement of new fully paid ordinary Shares in the capital of the Company at an issue price of $0.005 per Share to sophisticated or professional investors under section 708 of the Corporations Act without the need of a disclosure document (unless required by ASX in relation to the re-quotation of the Company’s Shares on the ASX) to raise up to $10 million (before costs of the offering).
(b) Investmet agrees to partially underwrite the Placement to the value of $5 million and the Company agrees to appoint Investmet as underwriter to the Placement subject to execution of an underwriting agreement on terms satisfactory to Investmet and the Company.
(c) The Company agrees to appoint Azure Capital as the lead arranger to the Placement on terms reasonably acceptable to the Company (acting reasonably).
(d) Completion of the Placement will be conditional on Shareholder approval for the restructure and recapitalisation of the Company and completion of the restructuring and recapitalisation of Swan Gold.

Other material terms

(a) Stirling Resources will procure that Stirling Copper Pty Ltd transfers 68,876,665 fully paid ordinary Shares in the capital of the Company, free of encumbrances, to Investmet.
(b) At Completion, the Investmet Loan will be converted into Shares in the capital of the Company, on the basis of $0.005 per Share.
(c) After Completion, the Company will repay the debt of approximately $3,400,000 currently owed to DCM with the proceeds from the Placement.
(d) After Completion, the Company will repay the debt of approximately $890,000 currently owed to Stirling Resources with the proceeds from the Placement. This debt may be converted into fully paid ordinary Shares in the capital of the Company, on the basis of $0.005 per Share, at the election of the Company. The Company and Stirling Resources agree to negotiate in good faith that the debt will remain after Completion such that the debt is governed by the Loan Syndicate Arrangements.
(e) From Completion, if there is any outstanding debt owed to Stirling Resources, the Company and Stirling Resources intend to establish Loan Syndicate Arrangements. The Loan Syndicate Arrangements will be on the following terms:
(i) a minimum interest rate of 6% per annum, subject to a reasonable commercial rate being agreed, will apply to all debt provided under the Loan Syndicate Arrangements as well as the existing and assigned debt and that reasonable commercial interest rate will be agreed between the Company and the Company’s subsidiaries (if applicable and only if the Company or any of the Company’s subsidiaries are a borrower under the Loan Syndicate Arrangements), Investmet and Stirling Resources;

(ii) all interest under the Loan Syndicate Arrangements and the existing and assigned debt is to be capitalized during a two year moratorium period; and
(iii) at the end of the two year moratorium, the Company may elect to repay the outstanding principal (including the capitalised interest) or require conversion of the outstanding principal into new shares of the Company at a conversion price to be agreed pursuant to the Loan Syndicate Arrangements.
(f) Prior to Completion, Investmet may nominate and have appointed with immediate effect up to three nominee directors to the board of the Company. A nominee of DCM will be chairman of the Company and at least half of the directors of the Company must be comprised of DCM nominees.
(g) At Completion, Investmet may nominate in writing up to two nominee directors to the board of the Company or the board of any of the Company’s subsidiaries.

Conditions

Completion of the Restructure Deed is conditional upon certain conditions being satisfied or waived by the relevant date referred to in the condition or if there is no time referred to in the relevant condition by 21 February 2013 (or such other date as agreed in writing by the parties to the Restructure Deed). The following are the material conditions precedent:

(a) the Company obtaining all Shareholder and regulatory approval that is required by the Company to implement the transactions contemplated by the Restructure Deed and the Transaction Documents including any Shareholder approval required under the ASX Listing Rules and the Corporations Act (including under sections 195(4), 257D and 611 Item 7 of the Corporations Act) including conditional approval from the ASX on conditions that are customary and are able to be satisfied by the Company. The Company must hold the meeting for shareholder approval on or prior to 15 January 2013;
(b) each of the Transaction Documents (in a form reasonably satisfactory to Investmet) being executed by each of the relevant parties to those documents on or around the date of the amended and restated Restructure Deed;
(c) the conditions under each of the other Transaction Documents being satisfied or waived in accordance with the relevant Transaction Document;
(d) the warranties given by the Company being true, accurate and complete as at the date of this Deed and at all times up to Completion;
(e) the warranties given by Stirling Resources being true, accurate and complete as at the date of this Deed and at all times up to Completion; and
(f) agreement on the terms of the documents relating to the Loan Syndicate Arrangements (if required) by all the parties to those documents other than any third party financier (if any).

ANNEXURE B – MATERIAL TERMS OF THE SWAN GOLD RESTRUCTURE DEED

(a) Placement : Swan Gold will undertake a placement to sophisticated and professional investors to raise up to $15 million (and up to $17.5 million with the consent of Stirling Resources) at $0.02 per share which will be partially underwritten by Investmet to the value of $7.5 million.
(b) Trust payments : Investmet will make the following payments:
(i) $10 million to the Trustee of the Group Trust in consideration of the Trustee assigning all of the debt owed by Swan Gold to the Trustee and transferring 134,483,578 Swan Gold shares to Investmet;
(ii) $144,240 to the Trustee of the Group Trust as payment on behalf of Swan Gold to repay in full a loan made by the Trustee of the Group Trust to Swan Gold. This amount will be a debt from Swan Gold to Investmet upon completion of the Swan Gold Restructure Deed;
(iii) $2.59 million to Stirling Resources in consideration of Stirling Resources assigning the $2.59 million to Investmet and transferring 88,053,475 Swan Gold shares to Investmet;
(iv) $6.7 million to the Trustee of the Territory Trust in consideration of assigning all of the debt owed by Swan Gold to the Trustee and DCM transferring 39,849,657 Swan Gold shares to Investmet; and
(v) $1.23 million to DCM.

As a result of the above, all claims against Swan Gold and each of its subsidiaries by the Trustee as trustee of each of the Group Trust, Territory Trust and Mt Ida Trust (together, the Creditors’ Trusts ) and DCM will be released and all security held by the Trustee of the Creditors’ Trusts in or over Swan Gold, its subsidiaries and its assets will be discharged. In addition, Investmet will acquire 262,386,710 Swan Gold shares from the Group Trust, Stirling Resources, DCM and the Territory Trust.

(c) Conversion of Debt: At Completion, Swan Gold’s debt of $11,345,000 (plus all further amounts owing under the loan agreement between Swan Gold and Investmet undated) owed to Investmet will be converted into fully paid ordinary shares in the capital of Swan Gold, on the basis of $0.02 per share. A further $5 million of debt held by Investmet may also be converted into shares of Swan Gold, on the basis of $0.02 per share, at the election of Investmet. If Investmet elects to convert more debt, Stirling Resources may convert such part of its outstanding debt into shares of Swan, on the basis of $0.02 per share, as is equal to half the amount converted by Investmet. If Investmet elects not to convert any of its debt and Swan will not satisfy any financial condition imposed on Swan by the ASX in connection with its re-quotation, then Stirling Resources may convert such amount of debt as will entitle Swan to satisfy such ASX condition.
(d) Loan arrangements : DCM and Investmet intend to establish Loan Syndicate Arrangements with Swan Gold. These will include:
(i) general security interests over the assets of Swan Gold;
(ii) a two year moratorium on principal repayments from Completion of the Swan Gold Restructure Deed; and

(iii) a minimum interest rate of 6% to be agreed between Swan Gold, Investmet and third party financiers.

Upon completion of the moratorium period, Swan Gold may choose to repay the outstanding principal in cash or convert it into Swan Gold shares at a conversion price to be agreed between the parties.

All existing debt of Swan Gold will be on the same terms as the Loan Syndicate Arrangements going forward.

(e) Interim funding : Investmet has agreed to provide interim funding to Swan Gold to the earlier of termination or Completion. At Completion, the interim funding will convert into fully paid ordinary shares of Swan Gold on the basis of $0.02 per shares.
(f) Repayment of Debt : After Completion, Swan Gold will repay the debt of $4,200,000 owed to DCM with the proceeds from the placement.
(g) Conditions : Completion of the Swan Gold Restructure Deed is conditional upon certain conditions being satisfied or waived by 21 February 2013 (or such other date as agreed in writing by the parties to the Swan Gold Restructure Deed). The following are the material conditions precedent:
(i) DCM and Swan Gold executing a deed of termination and release pursuant to which the share sale agreement between DCM and Swan Gold, dated 18 August 2011 ( Share Sale Agreement ) shall be terminated without any liability for DCM or Swan Gold and both DCM and Swan Gold shall be released from all liability and obligations under the Share Sale Agreement. The deed of termination and release shall be subject to and conditional upon completion of the Swan Gold Restructure Deed occurring;
(ii) The parties to the recapitalisation deed between the Trustee, Swan Gold and others dated 21 June 2009 (as amended) ( Recapitalisation Deed ) executing a deed of termination and release pursuant to which the Recapitalisation Deed shall be terminated without any liability for the parties and all parties shall be released from all liability and obligations under the Recapitalisation Deed. The deed of termination and release shall be subject to and conditional upon Completion occurring;
(iii) Swan Gold obtaining all shareholder approvals that are required by Swan Gold to implement the transactions contemplated by the Swan Gold Restructure Deed and the Transaction Documents including any shareholder approvals required under the ASX Listing Rules and the Corporations Act (including under section 611 Item 7 of the Corporations Act) including conditional approval from the ASX on conditions that are customary and are able to be satisfied by Swan Gold. Swan Gold must hold the meeting for shareholder approval on or prior to 15 January 2013;
(iv) each of the Transaction Documents (in a form satisfactory to Investmet) being executed by each of the relevant parties to those documents on or around the date of the amended and restated Swan Gold Restructure Deed;

(v) the conditions under each of the other Transaction Documents being satisfied or waived in accordance with the relevant Transaction Document; and
(vi) agreement on the terms of the documents relating to the Loan Syndicate Arrangements to which Swan Gold or its subsidiaries are a party by all the parties to those documents other than any third party financier (if any).

The conditions in paragraphs (i) to (iv) may be waived by the mutual written agreement of Swan Gold, DCM and Investmet. The conditions in paragraphs (v) and (vi) may only be waived by Investmet.

(h) Directors : The existing directors of Swan Gold will retire as directors of Swan Gold and its subsidiaries and will be replaced by nominees of Investmet.
(i) Warranties : The Swan Gold Restructure Deed includes various warranties given by Swan Gold, DCM and Investmet ( Swan Gold Restructure Deed Warranties ). The Swan Gold Restructure Deed Warranties include nominal commercial warranties to cover such items such as title, power, authority, insolvency and corporate records in relation to Swan Gold.
(j) Governing law : The Swan Gold Restructure Deed is governed by the laws of Western Australia.

ANNEXURE C – COMPANY’S CAPITAL STRUCTURE

Upon the completion of the Placement, the proposed capital structure of the Company is as follows:

Number of Shares Total at the date of the 392,630,263 Meeting To be issued under the Placement 2,000,000,000 Total after completion of Placement 2,392,630,263 and after completion of Resolutions 1-10

ANNEXURE D – TERMS AND CONDITIONS OF SHARES

(a) Class of Shares: The Shares are ordinary shares which rank equally in all respects with all existing ordinary shares.
(b) Voting Rights: Subject to the Constitution and any rights or restrictions at the time being attached to any class or classes of Shares, at meetings of Shareholders or classes of Shareholders every Shareholder present in person, or by proxy, attorney or representative, has one vote on a show of hands, and upon a poll, one vote for each Share and a fraction of a vote for each partly paid Share equivalent to the proportion which the amount paid (not credited) is of the total amounts paid and payable in respect of those Shares (excluding the amounts credited).
(c) Dividends: Directors may from time to time declare a dividend to be paid to the Shareholders entitled to the dividend. Subject to any rights or restrictions attached to a class of Shares and to the rights of the holders of any Shares created or raised under any special arrangement as to dividend, the dividend as declared shall be payable on all Shares according to the proportion that the amount paid (not credited) is of the total amounts paid and payable (excluding amounts credited) in respect of such Shares in accordance with the Corporations Act.
(d) Winding up: Subject to the rights of Shareholders (if any) entitled to Shares with special rights in a winding-up and the Corporations Act all monies and property that are to be distributed among Shareholders on a winding-up, shall be distributed in proportion to the Shares held by them respectively, irrespective of the amount paid-up or credited as paid-up on the Shares.
(e) Transfer of Shares: Generally, shares are freely transferable, subject to satisfying the requirements of the ASX Listing Rules. The Directors may decline to register any transfer of Shares but only where permitted or required to do so by the ASX Listing Rules or where the transfer is a transfer of Restricted Securities (as defined in the ASX Listing Rules) which is or might be in breach of the ASX Listing Rules or any escrow agreement entered into by the Company in relation to such Restricted Securities pursuant to the Listing Rules.
(f) Further Increases in Capital: Subject to the Corporations Act and the ASX Listing Rules and without prejudice to any special rights previously conferred on the holders of any existing Shares or class of Shares the Directors may at any time issue such number of Shares as ordinary Shares or Shares of a named class or classes (being either an existing class or a new class) at the issue price that the Directors determine and with such preferred, deferred, or other special rights or restrictions, whether with regard to dividend, voting, return of capital or otherwise, as the Directors shall, in their absolute discretion, determine.
(g) Variation of Rights: If at any time the share capital of the Company is divided into different classes of Shares, the rights attached to any class (unless otherwise provided by the terms of issue of the Shares of that class) may be varied, whether or not the Company is being wound up, with the consent in writing of the holders of three quarters of the issued Shares of that class, or if authorised by a special resolution passed at a separate meeting of the holders of the Shares of the class.

(h) Meetings and Notices: Each Shareholder will be entitled to receive notice of, and to attend and vote at, general meetings of the Company.

ANNEXURE E – INDEPENDENT EXPERT’S REPORT

PO Box 1908 West Perth WA 6872 Australia

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Level 2, 1 Walker Avenue West Perth WA 6005 Australia Tel: +61 8 9481 3188 Fax: +61 8 9321 1204

12 December 2012

ABN: 84 144 581 519 AFS Licence No: 418019 www.stantons.com.au

The Directors Redbank Copper Limited 143 Hay Street SUBIACO WA 6008

In our opinion the proposals as outlined in resolutions 1 and 3 are on balance, fair and reasonable to the non-associated shareholders of Redbank at the date of this report.

Dear Sirs

RE: REDBANK COPPER LIMITED (ABN 66 059 326 519) (“REDBANK” OR “THE COMPANY”) - INDEPENDENT EXPERT’S REPORT PURSUANT TO SECTION 611 (ITEM 7) OF THE CORPORATIONS ACT 2001 (“TCA”) ALLOWING INVESTMET LIMITED (“INVESTMET”) TO SUBSCRIBE FOR UP TO 2 BILLION SHARES IN REDBANK AT 0.5 CENTS PER SHARE AND ALLOWING INVESTMET TO OBTAIN A RELEVANT INTEREST IN 68,876,665 SHARES HELD BY A SUBSIDIARY OF STIRLING RESOURCES LIMITED (“SRE”) RERESENTING AN APPROXIMATE 17.54% SHAREHOLDING IN REDBANK.

1. Introduction and Background

1.1 We have been requested by the Directors of Redbank to prepare an Independent Expert’s Report in accordance with Section 611 (Item 7) of TCA on the fairness and reasonableness of resolution 1 (issue of up to 2 billion shares to Investmet at 0.5 cents per share) to the Notice of Meeting (“Notice”) to be distributed to the shareholders of Redbank in December 2012 for a shareholders meeting in January 2013. The Company via resolution 2 is proposing to raise up to $10,000,000 (the issue of up to 2 billion shares at 0.5 cents each) but the minimum capital raising will be $5,000,000 (1 billion shares and Investmet is only underwriting to the extent of 1 billion shares). However Investmet, Michael Fotios (and their respective associates) may subscribe for up to 2 billion Redbank Placement Shares of which 1 billion are per the underwriting commitment. Stirling Copper Pty Ltd (“Stirling Copper”), a wholly owned subsidiary of SRE owns 115,838,989 shares in Redbank. Resolution 3 in the Notice refers to the proposal to allow Investmet to acquire 68,876,665 of such shares shares in the Company from the SRE Group and we have been requested to provide an opinion on the fairness and reasonableness of the proposal pursuant to resolution 3.
1.2 On 22 May 2012, the Company announced a restructure of the Company (since amended as noted in paragraph 1.6 below) via a Restructure Deed (the original SRE and Redbank Restructure Deed) signed between Redbank, SRE (as noted above, a significant shareholder in Redbank via Stirling Copper Pty Ltd, a wholly owned subsidiary of SRE), DECOmetal GmbH (“DCM”) (a significant shareholder in SRE) and Investmet that included inter-alia the following transactions (“Redbank Transactions”) that related to Redbank:
Redbank will undertake a placement of new Redbank shares at a price of 0.5 cents per share to raise up to $5,000,000 (arranged and underwritten by Investmet) (up to 1 billion new shares) (“the Redbank Placement”). If Redbank does not raise the entire $5,000,000, Redbank will undertake a rights issue to raise the additional amount

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Liability limited by a scheme approved under Professional Standards Legislation

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(subsequent to the SRE and Redbank Restructure Deed being signed, the Company has decided to seek shareholder approval to issue up to 2 billion shares at 0.5 cents each, to raise up to $10,000,000 but only 1 billion shares will be underwritten as noted below but Investmet may be allowed to subscribe to up to the 2 billion shares as noted in resolution 1);

The loan from SRE to Redbank of $1,690,000 will be reassigned to DCM or nominee (“the Loan”);
DCM will provide funding to Redbank of up to $400,000 per month, up to the Completion Date of the Transaction, to partly repay the intercompany debt owed by Redbank to SRE, as well as fund ongoing commitments ($744,000 advanced after 22 May 2012 to 30 June 2012 and since 1 July 2012 to 20 September 2012, $200,000 has been advanced). In the event that further funding is required by SRE or Redbank, DCM and Investmet will negotiate in good faith a facility agreement or other financing arrangements and a security package, which will be determined by Investmet in its absolute discretion;
All existing share options DCM holds in Redbank will be cancelled for nil consideration (900,000 share options that expire in any event on 30 June 2012); and
SRE will transfer 39,263,026 Redbank shares to DCM or nominee (“the Sale Shares”).

Also refer below for potential syndicated loan arrangements and appointment of new directors to Redbank. Refer paragraph 1.6 below for changes.

1.3 In addition the original SRE and Redbank Restructure Deed included a restructure of SRE (see changes as noted in paragraph 1.6) and this includes SRE buying back from DCM the shares held by DCM in SRE, the consideration for which is:
SRE will transfer to DCM or nominee one fully paid share comprising the entire issued capital in its wholly owned subsidiary, Stirling Zircon Pty Ltd (“Stirling Zircon”) (that as at 21 September 2012 owns approximately 29.57% of the ASX listed company, MZI Resources Limited (formerly called Matilda Zircon Limited) (“MZI”);
SRE will assign to DCM or nominee $1,000,000 owed to SRE to MZI;
SRE will assign to DCM or nominee $5,000,000 owed to SRE by Swan Gold Limited (“Swan Gold”);
SRE will assign to DCM or nominee $1,690,000 owed to SRE by Redbank (see above);
Any existing security by SRE in the loans to MZI, Swan and Redbank will either be transferred to DCM or nominee or be discharged and replaced with the same security in favour of DCM or nominee and any additional security required by DCM or nominee will be granted by the relevant charge pursuant to loan syndicate arrangements;
SRE will procure that its wholly owned subsidiary, Stirling Gold Pty Ltd (“Stirling Gold”) transfers 74,348,766 shares in Swan Gold to DCM or nominee;
SRE will procure that its wholly owned subsidiary, Stirling Copper Pty Ltd (“Stirling Copper”) transfers 39,263,026 shares in Redbank to DCM or nominee (refer above);
DCM will forgive the Forgiven Debt (refer below) and will release SRE and Stirling Zircon from the obligations to pay the Forgiven Debt. The Forgiven Debt means a liability of $2,600,000 from SRE to DCM plus all accrued and outstanding interest; means a liability of $5,050,000 from SRE to DCM plus all accrued and outstanding interest; and a liability of $10,000,000 plus interest (as at March 2012) from Stirling Zircon to DCM plus all further accrued and outstanding interest; and

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SRE will transfer $4,000,000 in cash to DCM or nominee after Completion (as defined) of a fundraising to raise funds of up to $7,500,000 where such fundraising will consist of the placement undertaken by SRE at 1 cent per share to sophisticated investors. If SRE does not raise the entire $7,500,000, SRE will undertake a rights issue to raise the additional amount.
1.4 In addition, the original SRE and Redbank Restructure Deed proposed the following (see changes as noted in paragraph 1.6):
SRE will cancel the shares held by DCM in SRE (minimum of 326,000,000 shares held by DCM out of 351,000,000 shares held by DCM and associated parties in SRE);
DCM will use its best endeavours to increase the number of shares held by DCM’s associates in SRE to be bought back, up to a total of 351,000,000 shares in SRE, for no additional cost;
Investmet will fully underwrite the abovementioned SRE and Redbank placements, on terms reasonably acceptable to Investmet, SRE and Redbank respectively;
SRE and Redbank agree to appoint Azure Capital Limited (“Azure”) as lead arranger to the abovementioned placements by SRE and Redbank, on terms reasonably acceptable to SRE and Redbank respectively;
All existing share options DCM holds in SRE and Redbank (see above) will be cancelled for nil consideration although it is noted that all of the share options expired on 30 June 2012;
Investmet and/or DCM intend to establish syndicated loan arrangements with SRE and/or Redbank to include general security interests over their respective assets, incorporating a two year moratorium on principal repayments and at the end of the two year moratorium, the applicable of SRE and Redbank may elect to repay the debt or require conversion at a price to be agreed between the parties;
Prior to Completion, Investmet has the right to appoint two nominees to the Boards of each of SRE and Redbank however a nominee of DCM will be the chairman of both the SRE and Redbank boards. At Completion, Investmet has the right to appoint a further two nominee directors to the boards of SRE and Redbank (refer paragraph 2.3 for subsequent appointment of directors).
1.5 The Redbank Transactions were subject to a number of conditions, including inter-alia;
SRE and Redbank obtaining all necessary shareholder and regulatory approvals;
SRE and Redbank each having received a copy of any third party consent, or waiver from any third party, required;
each of the Transaction Documents (see below) required to effect the restructure and recapitalisation of SRE, Redbank and Swan Gold (“the Restructured Entities”) being executed by each of the relevant parties to those documents on or around the date of the Group Restructure Agreement between DCM and Investmet dated 19 April 2012, other than for the MGMC Pty Ltd (‘MGMC”) Trustee Deed Poll which must be executed by the Trustee (MGMC) within 20 business days of the date of the Restructure Deed;
the conditions under each Transaction Documents being satisfied or waived in accordance with the relevant Transaction Documents, including the need for any shareholder approval under Section 611 (Item 7) of the Corporations Act 2001 by any of the shareholders of the Restructured Entities;
the warranties made by SRE and Redbank in the original Restructure Deed being true, accurate and complete at all times up to Completion;
the termination of the agreement between La Jolla Cove Investors Inc (“La Jolla”) and Redbank dated 4 December 2009 on terms reasonably satisfactory to Investmet;
agreements on the terms of the documents relating to loan syndicate arrangements by all parties to those documents other than any third party financier; and

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the Recapitalisation Deed entered into between MGMC (as Trustee), SRE and other parties dated 21 June 2009 (as amended) being terminated with no further liability for any third party to that deed.

The Transaction Documents referred to above meant:

the original SRE and Redbank Restructure Deed;
the Group Restructure Deed;
the Facility Agreement and any document defined as a Transaction Document in that document;
the Swan Gold Restructure Deed between Investmet, DCM and Swan Gold;
the MGMC Trustee Deed Poll by MGMC Pty Ltd as Trustee of the Group Trust, the Mt Ida Trust and the Territory Trust (as all defined) (all relate to a previous recapitalisation of Swan Gold); and
any other document or arrangements effecting the Group Restructure (restructuring and recapitalisation of the Restructured Companies), which Investmet and DCM notifies in writing to the other Parties as being a Transaction Document.
1.6 Due to the ASX insisting on a Chapter 1 and Chapter 2 application being made in relation to SRE being re-listed on ASX, a new Term Sheet was entered into by DCM and Investmet that altered above the proposed Swan Gold Transactions and the originally proposed Redbank Transactions noted above. The amended Restructure Transaction involving Redbank are noted below:
The rights and obligations of SRE in that document will be of no force and effect;
The capital raising to be undertaken by Redbank will be increased up to $10,000,000 (at 0.5 cents per share) (2 billion shares) of which $5,000,000 (1 billion shares) will be underwritten by Investmet;
SRE will procure that Stirling Copper transfers 68,876,665 shares in Redbank to Investmet;
At Completion, Investmet will convert $750,000 of debt due by Redbank to Investmet into 150,000,000 ordinary shares in Redbank at 0.5 cents per share. The parties acknowledge that the final amount of debt held by Investmet to be converted may be higher subject to the level of additional interim funding provided by Investmet from the date of the Term Sheet.
After Completion, Redbank will pay DCM $3,300,000 and SRE $890,000 (totalling $4,190,000) with the proceeds from the capital raising by Redbank;
The debt of $890,000 is to be repaid or converted into ordinary shares (at 0.5 cents each) on Completion at the election of Redbank. The parties agree to negotiate in good faith that the debt will remain after Completion such that the debt is governed by the Loan Syndicate Arrangements.
1.7 The Company in August 2012 entered into a Convertible Note Facility (“Note Facility”) for up to $1,500,000 and to 16 November 2012 an amount of $750,000 has been drawn down under the Note Facility. The terms and conditions of the Investmet Loan provided that any amounts drawn down under the loan will automatically convert into Shares, issued at 0.5 cents (the same price as under the Placement), if the transactions contemplated by the Transaction Documents complete. The material terms and conditions of the Investmet Loan are set out below:
Investmet has agreed to make available a secured facility of $1,500,000. Amounts drawn down must be used for approved purposes.
The Company and Redbank Operations Pty Ltd (a wholly owned subsidiary) have granted a security interest in and over its personal property and a fixed charge over

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all of its other property to Investmet to secure the amounts drawn down under the Investmet Loan.

In the absence of any event of default, any amounts outstanding under the Investmet Loan will automatically convert into shares if the transactions contemplated by the Transaction Documents complete. The number of shares which Investmet will be entitled to on conversion of all or part of the amount drawn down under the loan is calculated by dividing the amount being converted by 0.5 cents. The shares issued and allotted on conversion will rank equally with all existing shares of the Company. The total amount raised by the Company under the Redbank Placement will be reduced to the extent any amounts lent under the Investmet Loan are converted by Investmet into shares.
In the absence of an event of default or conversions of any advance, the Company must repay each advance borrowed by the Company which is outstanding on the maturity date being 28 February 2013 (was initially 31 December 2012);
Interest is payable on the principal amount of each advance borrowed at 10% per annum. Any interest due will be capitalized daily and added to the Investmet Loan.
If an event of default occurs, and the Loan has not been converted into shares, the Company must repay the Investmet Loan within 5 Business Days of Investmet issuing a written notice requiring repayment. The events of default are set out in the ASX announcement made by the Company on 7 August 2012 and are customary for a transaction of this nature.
1.8 Resolution 1 seeks shareholder approval to issue up to 2 billion shares in Redbank at 0.5 cents per share (to raise up to $10,000,000) (with a minimum issue of 1 billion shares to raise $5,000,000). Resolution 1 seeks shareholder approval to issue to Investmet, Michael Fotios (including their associates) up to 1 billion shares as part of the Redbank Placement pursuant to the underwriting agreement and take up to a further 1 billion shares as a placee, so that Investmet can be issued to up to 2 billion shares. Investmet is to act as the underwriter to the Redbank Placement to the extent of $5,000,000 (1 billion shares), but in the event that it is required to cover a shortfall in full (up to $5,000,000), Investmet could obtain an approximate 71.81% shareholding interest (1 billion shares out of 1,392,630,263 shares that would be on issue in the event that the minimum amount raised from the Redbank Placement was $5,000,000) in Redbank following the above Transactions being consummated. In addition, Investmet is to acquire 68,876,665 shares in the Company from Stirling Copper (as noted in resolution 3), and thus Investmet’s shareholding interest in Redbank would be 1,068,876,665, representing approximately 76.76% of the expanded issued capital of Redbank. This resolution is in conjunction with resolution 2 that also refers to the issue of up to 2 billion shares to be issued to sophisticated investors. Investmet is acting as underwriter to the Redbank Placement of up to 1 billion shares. In the event that there is a shortfall in the Redbank Placement, Investmet would subscribe for the shortfall and in the worst case scenario may be up to 1 billion shares. In the event that 2 billion shares were issued under the Redbank Placement and Investmet took up all 2 billion shares, the percentage interest of Investmet would approximate 83.59% (out of 2,392,630,263 shares on issue) (and 41.795% if Investmet was only issued 1 billion shares). In addition, Investmet is to acquire 68,876,665 shares in the Company from Stirling Copper (as noted in resolution 3), and thus Investmet’s shareholding interest in Redbank would be 2,068,876,665, representing approximately 86.47% of the expanded issued capital of Redbank (and 44.67% if Investmet was only issued 1 billion shares via the Redbank Placement and it acquired the 68,876,665 shares from Stirling Copper).

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Investmet or SRE) would hold approximately 19.87% of the expanded issued capital of the Company (276,791,274 shares). There would be a total of 1,392,630,263 shares on issue post the placement of 1 billion shares. The above percentages alter if the maximum 2 billion shares are issued pursuant to the Redbank Placement.

Resolution 4 allows the Company to issue 178,000,000 shares in Redbank to SRE at an issue price of 0.5 cents each to allow the acquittal of the $890,000 liability due to SRE as noted in paragraph 1.6 and elsewhere in this report. Redbank however has the option to repay the debt due to SRE in cash or by shares. Resolutions 5 to 9 request approval to issue up to 200,000,000 shares each to various parties that are deemed Related Parties as noted in section 3 of the Explanatory Statement to Shareholders (“ESS”) attached to the Notice. These shares, if issued, form part of the up to 2 billion shares that may be issued pursuant to the Redbank Placement noted above and in resolution 2.

1.9 Under Paragraph 606 of TCA, a person must not acquire a relevant interest in issued voting shares in a company if because of the transaction, that persons’ or someone else’s voting power in the company increases:
(a) from 20% or below to more than 20%; or
(b) from a starting point that is above 20% and below 90%.

Under Section 611 (Item 7) of TCA, Section 606 does not apply in relation to any acquisition of shares in a company by resolution passed at a general meeting at which no votes were cast in favour of the resolution by the acquirer or the disposer or their respective associates. An independent expert is required to report on the fairness and reasonableness of the transactions noted in resolutions 1 and 3 pursuant to a Section 611 (Item 7) meeting.

1.10 Under ASIC Regulatory Guideline 111 “Contents of Expert Reports” an Independent Expert’s Report is required to report on the fairness and reasonableness of the transaction pursuant to resolutions 1 and 3. The Redbank directors have requested Stantons International Securities to prepare an Independent Expert’s Report to assist the shareholders in determining how to vote on resolutions 1 and 3 as outlined in the Notice and the ESS.
1.11

Apart from this introduction, this report considers the following:

Summary of opinion
Implications of the proposals with Investmet
Future direction of Redbank
Basis of technical valuation of Redbank
Premium for control
Fairness and reasonableness of the proposed Placement to Investmet
Conclusion as to fairness and reasonableness
Sources of information
Appendix A and Financial Services Guide
1.12 In determining the fairness and reasonableness of the Redbank proposals with Investmet (to issue up to 2 billion shares to Investmet (the Redbank Placement allows for the issue of up to 2 billion shares but Investmet is only underwriting to the extent of 1 billion shares but may subscribe to up to 2 billion shares as described in resolution 1 and the acquisition by Investment from SRE of 68,876,665 shares in Redbank), we have had regard for the definitions set out by the Australian Securities and Investments Commission (“ASIC”) in its Regulatory Guide 111, “Content of Expert Reports”. Regulatory Guide 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

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objective grounds after reference to that value (reasonableness). The concept of “fairness” is taken to be the value of the offer price, or the consideration, being equal to or greater than the value of the securities in the above mentioned offer. Furthermore, this comparison should be made assuming 100% ownership of the “target” and irrespective of whether the consideration is scrip or cash. An offer is “reasonable” if it is fair. An offer may also be reasonable, if despite not being ”fair”, there are sufficient grounds for security holders to accept the offer in the absence of any higher bid before the close of the offer. It also states that, where an acquisition of shares by way of an allotment is to be approved by shareholders pursuant to Section 611 (Item 7) of TCA, it is desirable to commission a report by an independent expert stating whether or not the proposal is fair and reasonable, having regards to the proposed allottees and whether a premium for potential control is being paid by the allottees. Although in this case the proposed Redbank Placement is not a takeover offer, we have considered the general principles noted above to determine our opinions on fairness and reasonableness pertaining to the proposals under resolution 1 and 3.

Accordingly, our report relating to the Redbank Placement proposal where Investmet could obtain a relevant interest in an approximate 83.59% shareholding in Redbank (and possibly up to a 86.47% relevant shareholding interest held directly) (assuming the maximum $10,000,000 from the Redbank Placement) is concerned with the fairness and reasonableness of the proposals with respect to the existing non-associated shareholders of Redbank and whether Investmet would be paying a premium for potential control. All shareholding percentages referred to in this report are before any of the 178,000,000 shares that could be issued to SRE as allowed for in Resolution 4 and as noted in paragraph 1.8 of this report.

1.11 Notwithstanding a technical value per Redbank share in excess of 0.5 cents each as noted below, in our opinion taking into account the precarious financial position of the Company and the large debt levels and the factors outlined in sections 4 to 6 of this report, the proposals as outlined in resolutions 1 and 3 are on balance, fair and reasonable to the non-associated shareholders of Redbank at the date of this report.

Notwithstanding that the Redbank share price last traded on ASX at 0.4 cents on 21 November 2011 (suspended from trading from 22 November 2011) is less than the proposed Redbank Placement price of 0.5 cents, each shareholder needs to examine the market conditions at the time of exercise of vote to ascertain the impact, if any, on resolutions 1 and 3.

The opinions expressed above must be read in conjunction with the more detailed analysis and comments made in this report including the Independent Geologist's Valuation Report (Agricola Valuation Report) on the Redbank Copper Project tenements of the Redbank Group prepared by Agricola Mining Consultants Pty Ltd (dated 11 December 2012) (“Agricola”) a copy of which is attached as Appendix B to this report. The author of the Agricola Valuation Report is Malcolm Castle.

We are not reporting on the merits or otherwise of any other resolutions outlined in the Notice and Explanatory Statement.

2. Implications of the Proposals

2.1 As at 28 November 2012, there are 392,630,263 fully paid ordinary shares on issue in Redbank. The significant fully paid shareholders as at close of business on 19 July 2012 are disclosed as:

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Name of Shareholder Stirling Copper Pty Ltd La Jolla Cove Investors Inc Tai-Nien Fang & Su-Pen Hsiao Peter Paige Mr Hanif Miah Alexander Heino Adoberg Mr Friend Nothers		No. of Shares 115,838,989 15,299,031 6,400,000 5,640,000 5,500,000 5,307,500 4,700,000	% Interest 29.50 3.90 1.63 1.44 1.40 1.35 1.20
		158,685,520	40.42

2.2 The top twenty fully paid shareholders as at 19 July 2012 own approximately 51.32% of the current issued capital.
2.3 The current Board of Directors is expected to change in the near future as a result of the Redbank Placement and the other Redbank Transactions as at completion of the recapitalisation the DCM representatives are likely to resign. The directors as at 20 July 2012 were Martin Depisch, Lucanus Polagnoli and Thomas Styblo (all representatives of DCM). Under the SRE and Redbank Restructure Deed, Investmet had the right to appoint two nominees to the Boards of SRE and Redbank however a nominee of DCM will be the chairman of both the SRE and Redbank boards. On 24 July 2012 Lucanus Polagnoli resigned as a director, Martin Depisch became the Chairman and Damian Delaney (Investmet representative) joined the Board. On 17 September 2012, Messrs Michael Fotios (Investmet representative), Peter Farris (Investmet representative) and Dr Gerhard Kornfield (DCM representative) were appointed to the Board of Redbank. Currently, there are three DCM and three Investmet representatives on the Board of Redbank. The representatives of DCM may resign upon completion of the Redbank Transactions.
2.4 If shareholders approve all resolutions and the recapitalisation of Redbank is completed, Investmet who is to act as the underwriter to the Redbank Placement (to the extent of 1 billion shares) and in the event that it is required to cover the 1 billion share shortfall in full, could obtain an approximate 76.76% shareholding interest (1,068,876,665 shares out of 1,392,630,263 shares that would be on issue) in Redbank following the above Transactions being consummated. The Company has the right to issue up to 2 billion shares under the Redbank Placement but Investmet is only underwriting to the extent of 1 billion shares. If 2 billion shares are issued and Investmet subscribed for 1 billion shares via its underwriting obligations and acquired the 68,876,665 shares in Redbank from Stirling Copper, Investmet’s shareholding would approximate 44.67% (2,392,630,263 shares would be on issue). In the event that 2 billion shares were issued under the Redbank Placement and Investmet took up all 2 billion shares and acquired the 68,876,665 shares from Stirling Copper, the percentage interest of Investmet would approximate 86.47% (out of 2,392,630,263 shares on issue).

Post the minimum placement of 1 billion shares to sophisticated investors or Investmet as noted above (at 0.5 cents per share to raise a gross $5,000,000 – the maximum is $10,000,000), SRE’s indirect interest (via Stirling Copper) would reduce to approximately 3.37% (46,962,324 shares in Redbank). The remaining shareholders (not associated with Investmet or SRE) would hold approximately 19.87% of the expanded issued capital of the Company (276,791,274 shares). There would be a total of 1,392,630,263 shares on issue post the placement of 1 billion shares. The above percentages alter if the maximum 2 billion shares are issued pursuant to the Redbank Placement.

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3. Future Directions of Redbank

3.1 We have been advised by the directors and management of Redbank that:
There are no proposals currently contemplated either whereby Redbank will acquire any properties or assets from Investmet or sell any properties or assets to Investmet;
The composition of the Board will change in the short term as noted above;
The Company plans to raise further working capital in the near future as contemplated by the Redbank Placement of up to $10,000,000 (up to 2 billion shares) (minimum of $5,000,000 – 1 billion shares);
No dividend policy has been set and it is not proposed to be set until such time as the Company is profitable and has a positive cash flow; and
The Company will endeavour to enhance the value of its interests in its existing mineral assets.

4. Basis of technical valuation of Redbank

4.1 In considering the proposal as outlined in resolution 1 we have sought to determine if the 0.5 cents issue price under the Redbank Placement is in excess of the current fair value of the shares in Redbank on issue and then conclude whether the proposal is fair and reasonable to the existing non-associated shareholders of Redbank (not associated with Investmet).
4.1.1 The proposal pursuant to resolution 1 would be fair to the existing non associated shareholders if the issue price to Investmet is greater than or equal to the implicit value of the shares in Redbank currently on issue. Accordingly, we have sought to determine a theoretical value that could reasonably be placed on Redbank shares for the purposes of this report.
4.1.2 The valuation methodologies we have considered in determining the current technical value of a Redbank share are:
Capitalised maintainable earnings/discounted cash flow;
Takeover bid - the price which an alternative acquirer might be willing to offer;
Adjusted net asset backing and windup value; and
The market value price of Redbank shares.

4.2 Capitalised Maintainable Earnings / Discounted Cash Flows

4.2.1 Redbank currently does not have a reliable cash flow or profit history from a business undertaking and therefore this methodology is not appropriate. The Company needs funds to further progress the program at the Redbank Copper Project. It is likely too early to use a discounted cash flow model as proven and probable economic reserves are yet to be accurately determined. Currently, Redbank does not have sufficient funds (it has a deficiency in working capital) and thus any perceived technical values of the Redbank Copper Project and other mineral assets of the Redbank are theoretical as without funds the Redbank Copper Project could not be progressed.

4.3 Takeover Bid

We have been advised by management of Redbank that the directors do not believe that there would be any person with an interest in taking over 100% of the Company by way of a formal takeover bid. To our knowledge, there are no current bids in the market place and the directors of Redbank and ourselves have formed the view that there is unlikely to be any

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takeover bids made for Redbank in the immediate future. It is noted however that the holding of SRE (via Stirling Copper Pty Ltd) as at 22 November 2012 is approximately 29.50%. This may reduce to approximately 3.37% if 68,876,665 shares are transferred to Investmet and the minimum Redbank Placement of 1 billion shares is completed. As noted above, if all of the minimum 1 billion shares are issued to Investmet and the 68,876,665 shares are transferred from Stirling Copper to Investmet, Investmet’s direct shareholding could approximate 76.76% of the expanded issued capital of Redbank (approximately 44.67% if 2 billion shares are issued pursuant to the Redbank Placement). In the event that Investmet subscribed for the full 2 billion shares in the Redbank Placement and acquired the 68,876,665 shares from Stirling Copper, and as also set out in section 1.1 of the ESS, Investmet would have a relevant interest in approximately 86.47% of the expanded issued capital of Redbank (2,392,630,263 shares on issue).

4.4 Net Asset Backing and Wind-Up Value

4.4.1 A summary of the audited consolidated statement of financial position of Redbank as at 30 June 2012 is summarised below before allowing for any subsequent drawdown of up to $400,000 per month from DCM (refer paragraph 1.2 above for potential draw-downs which are repayment of part of the debt owing to SRE by Redbank) along with a pro-forma consolidated unaudited statement of financial position after allowing for the following:
the issue of 1 billion shares at an issue price of 0.5 cents per share to raise a gross $5,000,000 and the incurring of capital raising costs of approximately $416,450. The total amount raised by the Company under the Redbank Placement is reduced to the extent any amounts lent under the Investmet Loan Facility prior to the completion of the Redbank Placement are converted by Investmet into shares and thus this amounts to $750,000 as at 16 November 2012;
the repayment of the debt of $3,300,000 plus interest estimated to 28 February 2013 of $235,000 owed by Redbank to DCM out of the proceeds of the Redbank Placement;
the payment to La Jolla of $150,000 in July 2012 in full settlement of amounts owing;
the transfer of the 68,876,665 Sale Shares owned by SRE in Redbank to Investmet (no financial affect on the consolidated statement of financial position); and
the borrowing of a further $200,000 from DCM and the borrowing by Redbank of $750,000 from Investment and Redbank on lending $119,000 to SRE.

Current assets Cash at bank Trade and other receivables Inventories Prepayments Non -current assets Receivables and bonds Owing by SRE Plant and equipment Deferred capitalised expenditure Total assets	Audited 30 June 2012 $000’s Unaudited 30 June 2012 Pro-Forma $000’s 176 1,155 33 33 148 148 83 83
	440 1,419
	298 298 690 - 821 821 4,099 4,099
	5,908 5,218
	6,348 6,637

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Current liabilities Trade and other payables Provisions Interest bearing liabilities and borrowings Non-current Liabilities Provisions Owing to SRE Total Liabilities Net Assets Equity Issued capital Reserves Accumulated losses Net Equity	Audited 30 June 2012 $000’s Unaudited 30 June 2012 Pro-Forma $000’s 648 648 515 515 4,950 26
	6,113 1,189
	117 117 - 890
	117 1,007
	6,230 2,196
	118 4,441
	89,776 94,359 1,728 1,728 (91,386) (91,646)
	118 4,441

No allowance has been made for further administration and amortisation/depreciation costs since 30 June 2012. Included in the statement of financial position are amounts owing to SRE of a net $1,009,000 (credit balance of $1,699,000 and a debit balance of $690,000) and $3,178,114 owing to DCM ($3,135,000 principal and accrued interest $43,114) and $46,660 owing to La Jolla. Subsequent to 30 June 2012 and to 19 September 2012, a further $200,000 was borrowed from DCM and an amount of $750,000 has subsequently been borrowed from Investmet and $119,000 was lent to SRE. The amount owing to La Jolla was a convertible note (remains of previous convertible notes issued to La Jolla and converted to ordinary shares in Redbank). It is noted that La Jolla has notified Redbank that it has requested the Company to draw down a further US$1,500,000 under an agreement reached with the Company in the year ended 30 June 2010. The Company’s position is that it was not required to draw down the US$1,500,000 and issue new convertible notes. Subsequent to 30 June 2012, Redbank settled with La Jolla in full and final settlement and paid La Jolla the sum of $150,000. The net $890,000 owing to SRE may either be repaid in cash or converted to shares at 0.5 cents each (178,000,000 shares) in Redbank at Redbank’s option (refer resolution 4 in the Notice that allows for the issue of up to 178,00,000 shares in Redbank to be issued to SRE). The parties agree to negotiate in good faith that the SRE debt will remain after Completion such that the debt is governed by the Loan Syndicate Arrangements.

4.4.2 Based on the book values at 30 June 2012 this equates to a value per issued share (392,630,263 shares on issue) of approximately 0.003 cents (ignoring the value, if any, of non-booked tax benefits). Based on the pro-forma consolidated statement of financial position, the net book value totals $4,441,000 or approximately 0.318 cents per issued share (1,392,630,263 shares will be on issue). In the event that $10,000,000 was raised from the Redbank Placement and after allowing for capital raising costs of an estimated $800,000, the estimated pro-forma statement of financial position would approximate $9,058,000 or around 0.378 cents per share (2,392,630,263 shares on issue).

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4.5 Market Price of Redbank Shares

4.5.1 The Company has been suspended from trading in its shares on ASX since 22 November 2011. In the period 1 November 2011 to 21 November 2011, the shares in Redbank traded on ASX at between 0.4 cents and 0.5 cents. It is noted that the Company has virtually no cash and has a significant deficiency in working capital (deficiency as at 30 June 2012 of around $5,036,000. Between 1 July 2011 and 31 October 2011, the share price was between 0.4 cents and 1.9 cents (one day only) with most sales being below 1.0 cents (except for 23,518,418 shares traded on 5 July 2011 at between 1.2 cents and 1.9 cents. ASX queried the large volume and price increase as the share price for the week leading up to 5 July 2011 disclosed a share price of around 1.0 cents and far lower volumes of trades on a daily basis).
4.5.2 We note that the market has been informed of all of the current projects, joint ventures and farm in/farm out arrangements entered into between Redbank and other parties. We also note it is not the present intention of the directors of Redbank to liquidate the Company and therefore any theoretical value based upon wind up value or even net book values (as adjusted), is just that, theoretical. The shareholders, existing and future, must acquire shares in Redbank based on the market perceptions of what the market considers a Redbank share to be worth. The market has either generally valued the vast majority of junior/mid size mineral exploration and development companies at significant discounts or premiums to appraised technical values and this has been the case for a number of years although we also note that there was an orderly market for Redbank shares (to date of suspension from trading on ASX) and the market is kept fully informed of the activities of the Company. The market capitalisation of Redbank based on the last share sale (21 November 2011) price of 0.4 cents was approximately $1.570 million. Redbank’s market capitalisation is greater than the net equity position of around $0.348 million as at 30 June 2012.

4.6 Preferred value of Redbank fully paid shares (range) to arrive at fairness conclusion

4.6.1 Notwithstanding the good prospectivity of the Redbank’s Copper Project in the Northern Territory, without cash the Company cannot continue exploration, evaluation and development of the mineral assets. The closing share price on 21 November 2011 (last trading share price before being suspended) does not necessarily reflect fair value of the Company’s shares. If future exploration and evaluation proves successful and development of the Company’s copper project proceeds, then arguably the fair value of a Redbank share would be in excess of the 0.5 cents Redbank Placement price. The share price in the future is unknown but it may be fair to say that if the development and exploitation of the Company’s mineral assets proceeds then it is likely that the share price would be higher than the share price at 21 November 2011.

No detailed review was made by us of the assets and liabilities disclosed in the unaudited consolidated balance sheet of the Redbank Group as at 30 June 2012. The primary assets of the Redbank Group are the interests in the Redbank Copper Project. We, in conjunction with the Company commissioned Agricola author of the Agricola Valuation Report is Malcolm Castle) to value the Redbank Copper Project tenements held by Redbank and/or certain subsidiaries of Redbank. We have been assured, by management of Redbank that other than the Redbank Project tenements, they believe the carrying value of all current and non-current assets and liabilities at 30 June 2012 are fair and not materially misstated. The plant and equipment relating to the Redbank Copper Project is carried at written down value of approximately $821,000 and is only worth book value or more on the basis that the plant can be used for copper mining operations. No formal valuation is deemed necessary to be obtained for such plant and equipment as it is not the intention to sell the plant on a non commercial basis and it would be expected that the cash realisable value (scrap value) would be significantly below book values.

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The Agricola Valuation Report is attached as Appendix B to this report. We have used and relied on the Independent Valuation Report on the Mineral Assets and have satisfied ourselves that:

Agricola is a suitably qualified geological consulting firm and has relevant experience in assessing the merits of mineral projects and preparing mineral asset valuations (also the author of the report, Malcolm Castle is suitably qualified and experienced);
Agricola is independent from Swan Gold and Investmet; and
Agricola has employed sound and recognised methodologies in the preparation of the Agricola Valuation Report.

Agricola indicates that the Redbank Cooper Project tenements have a value in the range from $9,600,000 to $13,700,000 with a preferred value range of approximately $11,700,000.

If we ascribed the low, high and preferred valuations as a substitute to the $4,099,000 carrying value of the Redbank Copper Project tenements and used book values for all other assets and liabilities, the value per share may fall in the range of 1.43 cents to 2.47 cents with a preferred value of 1.96 cents (ignores losses incurred post 30 June 2012).

The future ultimate value of a Redbank share will depend upon, inter alia:

the future prospects of its mineral assets;
the state of the copper, gold and base metal markets (and prices) in Australia and overseas;
the state of Australian and overseas stock markets;
the strength of the Board and management and/or who makes up the Board and management;
general economic conditions;
the recoverability of all receivables, including those from SRE;
continued support from DCM and/or Investmet;
the liquidity of shares in Redbank; and
possible ventures and acquisitions entered into by Redbank.

Generally, the market is a fair indicator of what a share is worth, however the theoretical technical value based on the underlying value of assets and liabilities may be lower or higher. In the case of Redbank, current liquidity is not strong and it is noted that the adjusted current cash and receivables as at 30 June 2012 totalled $209,000 whilst trade creditors, accruals and provisions totalled $1,190,000 (excludes the loans due to SRE, DCM and La Jolla). The cash position is very poor taking into account the debts of the Company and the Company requires an urgent inflow of funds to be able to satisfy the debts owing and/or providing continued funding to develop underlying mining assets. However most of any future proceeds will be needed to pay creditors at 30 June 2012 plus ongoing costs (that may include exploration and development). In effect, SRE, DCM and/or La Jolla (and now Investmet) have been funding the Company over the past 24 months (and longer) and we have been advised that it is unlikely for Redbank in the near term to be able to raise new equity unless the restructure proposals noted in paragraphs 1.2 and 1.3 above are completed. Arguably, based on share prices from 1 October 2011 to 21 November 2011, the market value of a Redbank share lies mainly in the range of 0.4 cents to 0.6 cents (and arguably its fair value for the purposes of this report) but unless the Company raises further funds the share price may fall below the last sale price of 0.4 cents and may be forced into some sort of Administration. In the absence of sufficient cash resources, the Company cannot complete exploration, evaluation and possibly development of the Redbank Copper Project, repay the amounts owing to SRE, DCM, Investmet and others and meet on going

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working capital requirements. Under the amended SRE and Redbank Restructure Deed, the debts owing to DCM are to be repaid to the extent of $3,300,000. The net $890,000 owing to SRE may either be repaid in cash or converted to shares at 0.5 cents each (178,000,000 shares) in Redbank at Redbank’s option. The parties agree to negotiate in good faith that the SRE debt will remain after Completion such that the debt is governed by the Loan Syndicate Arrangements. Investmet intends to establish syndicated loan arrangements with Redbank to include general security interests over its assets, incorporating a two year moratorium on principal repayments and at the end of the two year moratorium, Redbank may elect to repay the debt or require conversion at a price to be agreed between the parties.

5. Premium for Control

5.1 Premium for control for the purposes of this report, has been defined as the difference between the price per share, which a buyer would be prepared to pay to obtain or improve a controlling interest in the Company and the price per share which the same person would be required to pay per share, which does not carry with it control or the ability to improve (increase) control of the Company.
5.2 Under TCA, control may be deemed to occur when a shareholder or group of associated shareholders control more than 20% of the issued capital. As noted above, Investmet’s interest in Redbank could increase from nil% to approximately 76.76% if it took up all of the 1 billion shares under the Redbank Placement (assuming the Redbank Placement was the minimum of 1 billion shares - $5,000,000) and 68,876,665 shares were acquired by Investmet from Stirling Copper. In the event that Investmet subscribed for the full 2 billion shares in the Redbank Placement and 68,876,665 shares were acquired by Investmet from Stirling Copper, Investmet would have a relevant interest in approximately 86.47% of the expanded issued capital of Redbank (2,392,630,263 shares on issue). Accordingly, we have addressed whether a premium for control could be paid by Investmet.
5.3 The Company has been suspended from trading in its shares on ASX since 22 November 2011. In the period 1 November 2011 to 21 November 2011, the shares in Redbank traded on ASX at between 0.4 cents and 0.5 cents. It is noted that the Company has virtually no cash and has a significant deficiency in working capital (deficiency as at 30 June 2012 of around $5,636,000. Between 1 July 2011 and 31 October 2011, the share price was between 0.4 cents and 1.9 cents (one day only) with most sales being below 1.0 cents (except for 23,518,418 shares traded on 5 July 2011 at between 1.2 cents and 1.9 cents. ASX queried the large volume and price increase as the share price for the week leading up to 5 July 2011 disclosed a share price of around 1.0 cents and far lower volumes of trades on a daily basis). It is noted that based on a book asset backing as at 30 June 2012 of approximately 0.003 cents per share, Investmet would be paying a premium for control. Therefore, based on a book asset backing and share prices in the three weeks leading up to the announcement of the Transactions involving the Company, Swan Gold, SRE and DCM Investmet can arguably be considered to be paying a premium for potential control. It is noted that based on an adjusted asset backing as at 30 June 2012 (taking into account the preferred fair market value of the Redbank Copper Project as noted above) of approximately 1.96 cents per share, Investmet would not be paying a premium for control.

We note that the market has been informed of all of the current projects, joint ventures and farm in/farm out arrangements entered into between Redbank and other parties. We also note it is not the present intention of the Directors of Redbank to liquidate the Company and therefore any theoretical value based upon wind up value or even net book value, is just that, theoretical. The shareholders, existing and future, must acquire shares in Redbank based on the market perceptions of what the market considers a Redbank share to be worth. Work undertaken to date has indicated that the Redbank’s Copper Project has potential but more work needs to be undertaken (that cannot occur without a cash injection such as that proposed under the Redbank Placement) to prove up additional copper reserves and

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resources. Preliminary indications are robust and allowing for discount for risk and the fact that no bankable feasibility studies have been completed indicate that a theoretical value per share may be in excess of the market price of November 2011 and the proposed Redbank Placement price of 0.5 cents per share. However, it is too early to place a long term technical value on the Redbank Copper Project and thus the value of a share in Redbank. However, as noted using the June 2012 value of the Redbank Copper Project tenements by Agricola, the value may lie in the range of 1.43 cents to 2.47 cents with a preferred value of approximately 1.96 cents (but with a company with a deficiency in working capital and without a recapitalisation, a chance that it could be put into Administration).

The Company will need to raise further substantial capital in the near future to continue exploration and evaluation of its copper projects that in these economic times may lead to a capital raising at a discount to market. It is not uncommon to have discounts of 20% to 30% and sometimes even more. No discount is being offered under the proposed Redbank Placement based on share prices from 1 November 2011 to 21 November 2011 but a discount would apply based on share prices prior to November 2011.

5.4 We note that currently Investmet does not have Board control of Redbank. As at 28 November 2012, there are three DCM representatives and three Investmet representatives on the Board of Redbank. Refer paragraph 2.3 above. The representatives of DCM may resign on completion of the Redbank Transactions.

6. Fairness and Reasonableness of the Redbank Placement Transaction

6.1 We set out below some of the advantages, disadvantages and other factors pertaining to the proposed Redbank Placement and the proposal to acquire 68,876,665 shares from Stirling Copper.

Advantages

6.2 By entering into the proposals with Investmet (and SRE and DCM where applicable), Redbank increases its cash reserves from virtually nil to approximately $1,250,000 and after paying out current liabilities (as at 30 June 2012) and the debts due to DCM and SRE, the net cash position will approximate $951,000 (assuming a minimum capital raising of a gross $5,000,000 pursuant to the Redbank Placement). The net cash reserves (after paying out the current liabilities using the 30 June 2012 figures) may increase to $4,847,000 if a gross $10,000,000 is raised from the Redbank Placement. Furthermore, if the $890,000 disclosed as a non-current liability in the pro-forma statement of financial position is not paid out to SRE, $890,000 cash will be saved as the debt would be converted to share equity (178,000,000 shares in Redbank issued to SRE as noted for in resolution 4). Obtaining access to a significant amount of cash funds in the current environment is difficult and thus the Company and its shareholders should benefit. This should alleviate cash flow concerns in the immediate future.
6.3 In the event that the full capital raising via the proposal with Investmet is not completed or the Company cannot raise adequate working capital from other sources, there is the likelihood that the Redbank Copper Project may be curtailed until such time as new funds are raised. In the current market it is difficult for exploration companies such as Redbank to raise equity. It is our understanding that discussions were held with other interested parties with a view to raising capital. We have been advised that management has considered that the best proposal put to them was the proposal that is being put to the shareholders in December 2012. In the absence of a significant capital raising as contemplated via the Redbank Placement, the Company may fall into Administration.

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6.4 There is an incentive for Investmet to ensure Redbank becomes a viable mineral exploration and development company as Investmet may obtain a significant shareholding interest in Redbank. Investmet is taking a risk in investing funds into Redbank as to a large extent, Redbank’s future share price may be determined by the exploitation and/or commercial success (or otherwise) of its mineral projects (including the Redbank Copper Project in the Northern Territory). There is a huge incentive for Investmet to make Redbank a successful company and have the share price rise considerably. All shareholders would benefit from a rise in the share price.
6.5 The issue price of the Redbank Placement shares is 0.5 cents that is at a premium of approximately 25% to the last sale price of a Redbank share traded on ASX on 21 November 2011.
6.6 Having Investmet as a significant shareholder may be an incentive to Investmet to financially support Redbank in future capital raisings although there is no assurance that this will occur. Investmet would be keen to ensure its investment in Redbank is successful.

Disadvantages

6.7 The number of fully paid ordinary shares on issue initially rises to 1,392,630,263 on completion of the Redbank Placement to the extent of $5,000,000. This represents an approximate 255% increase in the ordinary shares of the Company from the shares on issue as at 14 June 2012 (and 15 November 2012). In the event that the maximum number of shares are issued under the Redbank Placement (2 billion shares), the number of shares on issue would be 2,392,630,263, an approximate 609% increase in the ordinary shares on issue as at 15 November 2012. However, with the issue of 2 billion shares at 0.5 cents each, the capital injection would raise a gross $10,000,000 that is an advantage to the Company. The number of shares on issue may rise by a further 178,000,000 if Redbank issues shares to SRE to acquit a liability of $890,000.
6.8 An influential shareholding of the Company may be given to Investmet in that it could ultimately have direct and indirect (through SRE’s shareholding in Redbank) voting control of approximately 76.76% of the expanded ordinary issued capital after the successful ratification and implementation of resolution 1 and 3 and the other transactions contemplated by the Transaction Documents (and assuming no other share issues and that Investmet only subscribes for 1 billion shares). Existing shareholders would be diluted further so that in the absence of any further capital raisings, the existing non associated shareholders interest could reduce from 100.00% to approximately 23.24%. Refer paragraph 2.4 for the proposed changes in shareholding in Redbank by SRE. The above percentages would alter if the maximum $10,000,000 was raised pursuant to the Redbank Placement. Investmet’s relevant shareholding in Redbank could approximate up to approximately 86.47% if Investmet subscribed for all of the 2 billion shares.
6.9 There is always the possibility that the value of the shares may be in excess of the Redbank Placement price of 0.5 cents per share particularly if the Redbank Copper Project can increase its reserves and moves towards development (further funds would need to be raised if the Redbank Copper Project is to be developed). The 30 June 2012 audited asset backing per share approximates 0.003 cents. However, shareholders will benefit from an increased share price (in the event that the market re-rates the prospectivity of the Redbank Copper Project and the Company successfully proves up additional copper ore reserves).

Other Factors

6.10 Having a cornerstone investor such as Investmet has advantages but it may also limit the opportunity for other parties to bid for all or part of the shares in Redbank in the future. However, a takeover bid for the Company cannot be completely ruled out.

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6.11 Under the amended SRE and Redbank Restructure Deed, Investmet intends to establish syndicated loan arrangements with Redbank to include general security interests over its assets, incorporating a two year moratorium on principal repayments ant at the end of the two year moratorium, Redbank may elect to repay the debt or require conversion at a price to be agreed between the parties.
6.12 There is always the possibility that Investmet may in the future make a takeover bid for the remaining shares in Redbank as it could already own up to 76.76% of the issued capital of Redbank (assuming Investmet subscribes for 1 billion shares and acquires the 68,876,665 shares from Stirling Copper) or approximately 86.47% (assuming Investmet subscribed for 2 billion shares and acquires the 68,876,665 shares from Stirling Copper).

7. Conclusion as to Fairness and Reasonableness

7.1 Notwithstanding a technical value per Redbank share in excess of 0.5 cents each as noted below, in our opinion taking into account the precarious financial position of the Company and the large debt levels and the factors outlined in sections 4 to 6 of this report, the proposals as outlined in resolutions 1 and 3 are on balance, fair and reasonable to the non-associated shareholders of Redbank at the date of this report.

8. Sources of Information

8.1 In making our assessment as to whether the proposals under the Redbank Placement as outlined in paragraph 1.2 and the acquisition of the 68,876,665 shares from Stirling Copper are fair and reasonable, we have reviewed relevant published available information and other unpublished information of the Company that is relevant to the current circumstances. In addition, we have held discussions with the management of Redbank about the present and future operations of the Company. 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 Redbank.
8.2 Information we have received includes, but is not limited to:
Draft Notices of Redbank and drafts of Explanatory Statement to Shareholders prepared in July, August and September 2012 and updated to 28 November 2012;
Discussions with management and directors of Redbank;
Details of historical market trading of Redbank ordinary fully paid shares recorded by ASX for the period 1 July 2011 to 21 November 2011;
Shareholding details of Redbank as supplied by the share registry as at 19 July 2012;
Un-audited consolidated balance sheet of Redbank as at 30 April 2012 and audited balance sheet as at 30 June 2012 plus a pro-forma balance sheet taking into account the Redbank Placement and other proposed transactions;
Announcements made by Redbank, SRE and Matilda to the ASX from 1 January 2011 to 28 November 2012;
Audited financial statements of the Redbank Group for the years ended 30 June 2011 and 2012 and unaudited accounts of the Redbank Group for the six months ended 31 December 2011;
The Convertible Note Facility Deed and General Security Deed with Investmet of August 2012;
The cash flow forecasts of Redbank to 30 June 2013;
The Agricola Valuation Report on the Redbank Copper Project tenements of 11 December 2012;
The Term Sheet of November 2012 between DCM and Investmet as noted in paragraph 1.6 above;

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Information on SRE and Redbank as provided on the ASX web site and Redbank’s and SRE’s web sites.
8.3 Our report includes Appendices A and our Financial Services Guide attached to this report.

Yours faithfully STANTONS INTERNATIONAL AUDIT AND CONSULTING PTY LTD (Trading as Stantons International Securities)

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J P Van Dieren - FCA Director

APPENDIX A

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AUTHOR INDEPENDENCE

This annexure forms part of and should be read in conjunction with the report of Stantons International Audit and Consulting Pty Ltd trading as Stantons International Securities dated 29 November 2012, relating to resolutions 1 and 3 (only) outlined in the Notice of Meeting of Shareholders of Redbank.

At the date of this report, Stantons International Securities does not have any interest in the outcome of the proposals. Stantons International Audit and Consulting Pty Ltd trading as Stantons International (as an audit practice) are the auditors of Redbank since being appointed in November 2011. Other than for this relationship, there are no other relationships with Redbank 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 transactions detailed in this report which would affect our ability to provide an independent opinion. Internally, we addressed independence issues and concluded that the proposed Redbank Placement (and other proposals being sent out to shareholders arising from the SRE and Redbank Restructure Deed) did not affect our independence as auditors. 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 $30,000 (excluding disbursements and GST). 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 and Stantons International Audit and Consulting Pty Ltd or any directors of Stantons International Audit and Consulting Pty Ltd do not hold any securities in Redbank, SRE, Swan Gold or Investmet. 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. Stantons International Securities has prepared other independent expert reports for parties associated with Redbank, SRE and Swan Gold. Stantons International may be appointed as auditors of SRE if shareholders approve the resolution seeking to appoint Stantons International as auditors of SRE.

QUALIFICATIONS

We advise Stantons International Securities is the holder of an Investment Advisers Licence (No 418019) under the Corporations Act relating to advice and reporting on mergers, takeovers and acquisitions involving securities. A number of the directors of Stantons International Audit and Consulting Pty Ltd are the directors or authorised representatives of Stantons International Securities. Stantons International Securities and Stantons International Audit and Consulting 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 valuations 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 tasks they have performed.

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DECLARATION

This report has been prepared at the request of the directors of Redbank in order to assist the shareholders of Redbank to assess the merits of the proposal (resolutions 1 and 3 only) to which this report relates. This report has been prepared for the benefit of the Redbank shareholders and those persons only who are entitled to receive a copy for the purposes of Section 611 (Item 7) of the Corporations Act 2001 and does not provide a general expression of Stantons International Securities opinion as to the longer term value of Redbank and the assets of Redbank, including the Redbank Copper Project. Stantons International Securities does not imply, and it should not be construed, that it has carried out any form of audit on the accounting or other records of Redbank or any of its subsidiaries. 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 due 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 Audit and Consulting Pty Ltd, their directors, employees or consultants for the preparation of this report.

DECLARATION AND INDEMNITY

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

(a) to make no claim by it or its officers against Stantons International Securities and Stantons International Audit and Consulting Pty Ltd to recover any loss or damage which Redbank may suffer as a result of reasonable reliance by Stantons International Securities on the information provided by Redbank; and
(b) to indemnify Stantons International Securities and Stantons International Audit and Consulting Pty Ltd against any claim arising (wholly or in part) from Redbank or any of its officers providing Stantons International Securities any false or misleading information or in the failure of Redbank and 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 the directors of Redbank 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

PO Box 1908 West Perth WA 6872 Australia

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Level 2, 1 Walker Avenue West Perth WA 6005 Australia

Tel: +61 8 9481 3188 Fax: +61 8 9321 1204

FINANCIAL SERVICES GUIDE Dated 12 DECEMBER 2012

ABN: 84 144 581 519 AFS Licence No: 418019 www.stantons.com.au

1. STANTONS INTERNATIONAL AUDIT AND CONSULTING PTY LTD (TRADING AS STANTONS INTERNATIONAL SECURITIES)

Stantons International Securities (ABN 84 144 581 519 and AFSL Licence No 418019) ( “SIS” or “we” or “us” or “ours” as appropriate) has been engaged to issue general financial product advice in the form of a report to be provided to you.

2. FINANCIAL SERVICES GUIDE

In the above circumstances we are required to issue to you, as a retail client a Financial Services Guide ( “FSG” ). This FSG is designed to help retail clients make a decision as to their use of the general financial product advice and to ensure that we comply with our obligations as financial services licensees.

This FSG includes information about:

who we are and how we can be contacted;
the services we are authorised to provide under our Australian Financial Services Licence, Licence No: 418019 ;
remuneration that we and/or our staff and any associated receive in connection with the general financial product advice;
any relevant associations or relationships we have; and
our complaints handling procedures and how you may access them.

3. FINANCIAL SERVICES WE ARE LICENCED TO PROVIDE

We hold an Australian Financial Services Licence which authorises us to provide financial product advice in relation to:

Securities (such as shares and options)

We provide financial product advice by virtue of an engagement to issue a report in connection with a financial product of another person. Our report will include a description of the circumstances of our engagement and identify the person who has engaged us. You will not have engaged us directly but will be provided with a copy of the report as a retail client because of your connection to the matters in respect of which we have been engaged to report.

Any report we provide is provided on our own behalf as a financial services licensee authorised to provide the financial product advice contained in the report.

4. GENERAL FINANCIAL PRODUCT ADVICE

In our report we provide general financial product advice, not personal financial product advice, because it has been prepared without taking into account your personal objectives, financial situation or needs.

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Liability limited by a scheme approved under Professional Standards Legislation

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You should consider the appropriateness of this general advice having regard to your own objectives, financial situation and needs before you act on the advice. Where the advice relates to the acquisition or possible acquisition of a financial product, you should also obtain a product disclosure statement relating to the product and consider that statement before making any decision about whether to acquire the product.

5. BENEFITS THAT WE MAY RECEIVE

We charge fees for providing reports. These fees will be agreed with, and paid by, the person who engages us to provide the report. Fees will be agreed on either a fixed fee or time cost basis.

Except for the fees referred to above, neither SIS, nor any of its directors, employees or related entities, receive any pecuniary benefit or other benefit, directly or indirectly, for or in connection with the provision of the report.

6. REMUNERATION OR OTHER BENEFITS RECEIVED BY OUR EMPLOYEES

All our employees receive a salary. Our employees are eligible for bonuses based on overall productivity but not directly in connection with any engagement for the provision of a report.

7. REFERRALS

We do not pay commissions or provide any other benefits to any person for referring customers to us in connection with the reports that we are licensed to provide.

8. ASSOCIATIONS AND RELATIONSHIPS

SIS is a trading name owned by Stantons International Audit and Consulting Pty Ltd a professional advisory and accounting practice. From time to time, SIS and Stantons International Audit and Consulting Pty Ltd (also trading as Stantons International) and/or their related entities may provide professional services, including audit, accounting, probity, management, corporate and financial advisory services, to financial product issuers in the ordinary course of its business.

9. COMPLAINTS RESOLUTION

9.1 Internal complaints resolution process

As the holder of an Australian Financial Services Licence, we are required to have a system for handling complaints from persons to whom we provide financial product advice. All complaints must be in writing, addressed to:

The Complaints Officer Stantons International Securities Level 2 1 Walker Avenue WEST PERTH WA 6005

When we receive a written complaint we will record the complaint, acknowledge receipt of the complaints within 15 days and investigate the issues raised. As soon as practical, and not more than 45 days after receiving the written complaint, we will advise the complainant in writing of our determination.

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9.2 Referral to External Dispute Resolution Scheme

A complainant not satisfied with the outcome of the above process, or our determination, has the right to refer the matter to the Financial Ombudsman Service Limited (“FOSL”). FOSL is an independent company that has been established to provide free advice and assistance to consumers to help in resolving complaints relating to the financial services industry.

Further details about FOSL are available at the FOSL website www.fos.org.au or by contacting them directly via the details set out below.

Financial Ombudsman Service Limited PO Box 3 MELBOURNE VIC 3021

Toll Free: 1300 78 08 08 Facsimile: (03) 9613 6399

10. CONTACT DETAILS

You may contact us using the details set out above or by telephone (08) 9481 3188 or facsimile (08) 9321 1204.

APPENDIX B

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AGRICOLA VALUATION REPORT ON THE REDBANK COPPER PROJECT TENEMENTS DATED 11 DECEMBER 2012

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Malcolm Castle Agricola Mining Consultants Pty Ltd P.O. Box 473, South Perth, WA 6951 Phone: 61 (8) 9474 9351 Mobile: 61 (4) 1234 7511 Email: [email protected] ABN: 84 274 218 871

11 December 2012

The Directors Stantons International Securities Level 2, 1 Walker Street West Perth, WA, 6005

Dear Sirs,

Re: INDEPENDENT VALUATION OF THE MINERAL ASSETS of REDBANK COPPER LIMITED

in the NORTHERN TERRITORY

I have been commissioned by the Directors of Stantons International Securities (“Stantons” or the “Company”) to provide a Mineral Asset Valuation Report (“Report”) of the Redbank Copper Projects in the Northern Territory. This report serves to comment on the geological setting and exploration results on the properties and presents a technical and market valuation for the exploration assets based on the information in this Report.

The present status of the tenements listed in this report is based on information provided by the Company and is set out in the Tenement Schedule. The Report has been prepared on the assumption that the tenements are lawfully accessible for evaluation. Details in respect to the legal status of the tenements have not been independently verified by me.

DECLARATIONS

Relevant codes and guidelines

This report has been prepared as a technical assessment and valuation in accordance with the Code for Technical Assessment and Valuation of Mineral and Petroleum Assets and Securities for Independent Expert Reports (the “VALMIN Code”) , which is binding upon Members of the Australasian Institute of Mining and Metallurgy (“AusIMM”) and the Australian Institute of

Geoscientists (“AIG”), as well as the rules and guidelines issued by the Australian Securities and Investments Commission (“ASIC”) and the ASX Limited (“ASX”) which pertain to Independent Expert Reports ( Regulatory Guides RG111 and RG112 ).

Where mineral resources have been referred to in this report, the classifications are consistent with the ”Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves (“JORC Code”), prepared by the Joint Ore Reserves Committee of the AusIMM, the AIG and the Minerals Council of Australia, effective December 2004.

Under the definition provided by the VALMIN Code, the properties are classified as ‘Development Projects’ which contain Mineral Resources and are committed to production and ‘exploration areas’, which are inherently speculative in nature. The properties are considered to be sufficiently prospective, subject to varying degrees of risk, to warrant further exploration and development of their economic potential.

Sources of Information

The statements and opinion contained in this report are given in good faith and this review is based on information provided by the title holders, along with technical reports by consultants, previous tenements holders and other relevant published and unpublished data for the area. I have endeavoured, by making all reasonable enquiries, to confirm the authenticity, accuracy and completeness of the technical data upon which this report is based. A final draft of this report was provided to the Company, along with a written request to identify any material errors or omissions prior to lodgement.

In compiling this report, I did not carry out a site visit to any of the Company’s Project areas. Based on my professional knowledge and experience and the availability of extensive databases and technical reports made available by various Government Agencies, I consider that sufficient current information was available to allow an informed appraisal to be made without such a visit.

The independent 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. I have no reason to doubt the authenticity or substance of the information provided.

Qualifications and Experience

The person responsible for the preparation of this report is:

Malcolm Castle, B.Sc.(Hons), GCertAppFin (Sec Inst), MAusIMM

Malcolm Castle has over 45 years’ experience in exploration geology and property evaluation, working for major companies for 20 years as an exploration geologist. He established a consulting company 20 years ago and specialises in exploration management, technical audit, due diligence and property valuation at all stages of development. He has wide experience in a number of commodities including uranium, gold, base metals, iron ore and mineral sands. He has been responsible for project discovery through to feasibility study

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in Australia, Fiji, Southern Africa and Indonesia and technical Audits in many countries. He has completed numerous Independent Geologist’s Reports and mineral asset valuations over the last decade as part of his consulting business.

Mr Castle completed studies in Applied Geology with the University of New South Wales in 1965 and has been awarded a B.Sc.(Hons) degree. He has completed postgraduate studies with the Securities Institute of Australia in 2001 and has been awarded a Graduate Certificate in Applied Finance and Investment in 2004.

Competent Persons Statement

The information in this report that relates to Exploration Results and Mineral Resources of the Company has been reviewed by Malcolm Castle, who is a member of the Australasian Institute of Mining and Metallurgy. Mr Castle has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which they are undertaking to qualify as an Expert and Competent Person as defined under the VALMIN Code and in the 2004 Edition of the ‘Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves. Mr Castle consents to the inclusion in this report of the matters based on the information in the form and context in which they appear.

Independence

I am not, nor intend to be a director, officer or other direct employee of the Company or Redbank Copper Limited and have no material interest in the Projects or the Company. The relationship with the Company is solely one of professional association between client and independent consultant. The review work and this report are prepared in return for professional fees based upon agreed commercial rates and the payment of these fees is in no way contingent on the results of this Report.

Yours faithfully

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Malcolm Castle

B.Sc.(Hons) MAusIMM, GCertAppFin (Sec Inst)

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TENEMENT SCHEDULE

NORTHERN TERRITORY TENEMENTS

Lease		Locality	Lease Status	Grant Date	Current Area
EL28288	Redbank	NT	Granted	19/04/2011	327.6
EL28290	Redbank	NT	Granted	19/04/2011	100.8
ELR94	Redbank	NT	Granted	10/08/1989	19.05
ML27385	Redbank	NT	Application		19.05
MLN1108	Redbank	NT	Granted	1/10/1993	0.3308
MLN631	Redbank	NT	Granted	12/03/1973	0.1618
MLN632	Redbank	NT	Granted	12/03/1973	0.1618
MLN633	Redbank	NT	Granted	12/03/1973	0.1618
MLN634	Redbank	NT	Granted	12/03/1973	0.1618
MLN635	Redbank	NT	Granted	12/03/1973	0.1618
MLN636	Redbank	NT	Granted	12/03/1973	0.1618
EL10335	Woolongong JV	NT	Granted	5/08/2002	1023.75
EL24654	Copperado	NT	Granted	5/12/2005	315
EL28289	Copperado	NT	Granted	19/04/2011	37.8
EL26778	Calvert	NT	Granted	24/12/2008	330.75
EL26779	Calvert	NT	Granted	24/12/2008	173.25
EL26780	Calvert	NT	Granted	24/12/2008	204.75
EL26781	Calvert	NT	Granted	24/12/2008	34.65
EL27240	Calvert	NT	Granted	9/11/2009	59.85
EL27241	Calvert	NT	Granted	9/11/2009	321.3
EL27737	Calvert	NT	Granted	6/08/2010	50.4
EL28003	Siegal	NT	Granted	23/12/2010	110.25
EL26965	Benmarra	NT	Granted	18/06/2009	233.1
EL26999	Benmarra	NT	Granted	18/06/2009	425.25
EL28487	McDermott	NT	Granted	2/08/2011	510.3
EL28535	McDermott	NT	Granted	20/09/2011	66.15

Redbank are earning an interest in the Woolongong Joint Venture but have yet to reach an equity position.

The status of a cross section of the tenements has not been verified, pursuant to paragraph 67 of the Valmin Code, by Agricola Mining Consultants Pty Ltd. The tenements are believed to be in good standing as represented by Redbank.

I have not verified the current ownership status and legal standing of the tenements that are the subject of this report. Instead I have relied on legal advice, provided by Allion Legal regarding the status of the tenements underlying the mineral assets and this advice confirms that the tenements are in good standing in all material respects.

PROJECT REVIEW

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The following notes have been extracted from Redbank’s website and have been verified by reference to ASX releases and annual Reports.

The Redbank Copper Project is located in the Northern Territory McArthur River Basin 30km from the Queensland border and 70km south of the Gulf of Carpentaria. The Company has a significant ground position of 4,364km[2] of tenements within the McArthur Basin region. The region hosts significant economic copper mineralisation and is highly prospective for copper, cobalt, phosphate, manganese and uranium.

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The tenement package includes numerous advanced copper targets and has an indicated JORC resource of 2.76 million tonnes at 1.6% copper for 43,100 tonnes of copper metal and a total inferred and indicated resource of 6.24 million tonnes at a grade of 1.5% copper for 95,900 tonnes of contained copper metal.

The tenements have six project areas for control of planning and targeting, namely Copperado, Redbank, Calvert, Benmara, Seigal, and McDermott.

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Redbank has put in place an exploration program targeted at significantly expanding its current resources of 96,000t copper (comprising indicated resources of 2.765Mt at 1.6% Cu for 43,100t Copper and inferred of resource of 3.479Mt at 1.5% Cu for 52,700t of copper). It will also assess the prospectivity of its tenement package.

A review of the company’s tenements, and their prospectivity, was undertaken by Optiro, a WAbased geological consultancy, in April 2011. The study included; exploration data from the ERL94 tenement and its surrounds, the surrounding regional tenement package. Optiro reported that the tenement areas were highly prospective for copper and supported the planned 2011 exploration program targeting the highly prospective area within 20kms of ERL94. I have reviewed the report and I agree with the statements and conclusions contained in it.

History

Copper mineralisation at Redbank was discovered in 1916. Small scale-production between 1916 and 1957 yielded 1,200 imperial tons of copper ore at a grade higher than 30% Cu. Numerous companies investigated the area between the 1940s and early 1990s. A small open pit at the Sandy Flat deposit operated during the 1990s and processed 170,000t grading 5.4% copper, as well as leaving 54,000t grading 6.0% copper together with mining and processing infrastructure.

1900 - Copper mines were first discovered in the district in 1900 at a resource called China Girl, 25km to the north east of the Project area.

1912 - Further discoveries were made in 1912 at Packsaddle and Bauhinia prospects, 17km to the east of Redbank.

1916 - Copper was initially detected in the Redbank Copper Project Area by William Masterton.

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1916-1957 - Masterton achieved small scale production from shallow open pits and shallow underground workings in the supergene copper carbonate zone at the Azurite, Redbank and Prince deposits. This total production was more than 1,200 tonnes of copper ore.

1966 - Granville Development mined 2,000 imperial tons at a grade of 15% copper in 1966 which was sent to Mt Isa for treatment.

1969 - A joint venture between Harbourside Oil NL and Westmoreland Minerals commenced.

1971 - Harbourside was then joined by Newaim a consortium consisting of Newmont Australia, AMP and ANZICI. Newaim considered the discoveries which they made did not meet their corporate requirements and withdrew at the end of 1971.

1972 - Triako Mines NL entered into an agreement with Harbourside to explore at Redbank. Harbourside withdrew. Triako continued with various partners until 1983. The project was ultimately acquired by Alameda Pty Ltd.

1983 - An allied group of companies, Sanidine-Restech-Hunter Resources-Vanoxi took control of a much reduced area, which they protected by ERL94 and maintenance of the MLN.S. Work at Sandy Flat comprised 12 RC percussion holes to establish that diamond drilling had not downgraded the deposit by washing out the sulphide minerals. Hunter also endeavoured to characterize the deposit by further refining the work initiated by Triako using RRMIP over the Sandy Flat ore zone.

1989 - Redbank Copper Pty Ltd purchased the tenement group from Sanidine-Vanoxi in December 1989. - The final title was obtained in March 1990, since which time RCPL have undertaken two diamond core programmes to provide material for metallurgical testwork (November 1990) and to increase the resource. Cash flow analyses, market location and PER documentation followed.

1990 - Larger scale operations were undertaken in the mid 1990s when the Sandy Flat pit was developed to supply sulphidic ore to a 200,000 tonnes per annum flotation plant built at the site. Some very high grade (>25% copper) ore was also direct shipped at this time. The operation ceased after less than 2 years because of declining copper prices. With the exception of the mill, the flotation plant and crushing circuit remain on site. The most recent leaching operation began producing on an intermittent basis in 2004(Redbank Copper, 2001, 2004, 2005) and utilised oxide ore, that had been stockpiled during the mining of sulphides from the Sandy Flat Pit.

1993 - Alameda Pty Ltd commenced mining a small open pit operaton 50 metres deep at the Sandy Flat deposit between 1993 and 1996 processing 170,000 tonnes at 4.6% as well as leaving 54,000 tonnes at 6.0% in stockpiles.

2005 - Burdekin Paciific acquired the Redbank Project and changed its name to Redbank Mines Limited. In 2008 Stirling Resources Limited acquires a major stake in Redbank Mines Limited.

Regional Geology

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The Redbank Copper Project is hosted by rocks of the Macarthur River Basin(MCB), a mid Proterozoic epicratonic basin that is exposed over an area of 200,000km² in the Northern Territory and Queensland that hosts the world class Macarthur River lead zinc silver deposit (Plumb et al., 1990).

The MCB has two major sub divisions exposed: the Bauhinia Shelf and the Wearyan Shelf, the latter of which hosts the Redbank Copper Project. Deposition in the MCB occurred between 1725Ma and 1429Ma unconformably over the early Proterozoic Pine Creek Orogen, Arnhem Block and Murphy inlier. The MCB is itself overlain unconformably by Palaeozoic and Mesozoic basins.

Local Geology

The majority of MCB rocks in the Redbank area are part of the Tawallah Group, a northwest dipping package of sedimentary, volcanic and carbonate rocks that is the lowermost unit in the MCB sequence. The Tawallah Group has a maximum thickness of 4,800m and contains all of the volcanic rocks in the MCB sequence.

The lowermost unit is the Settlement Creek Volcanics (SCV), a series of alkaline trachyandesite flows and sills with interbedded volcaniclastics (Table 2). Overlying is the SCV is the Wollogorang Formation (WGF), a mixed clastic/carbonate sequence. The WGF has four lithological subdivisions: basal red shale, crystalline dolostone, an ovoid-concretion bearing dolostone and an arenaceous unit.

The Gold Creek Volcanics (GCV) overly the WGF, and comprise trachybasalt lavas with interbedded volcaniclastics. The Hobblechain Rhyolite, a distinctive marker unit of felsic lavas within the GVC, is exposed throughout the project area. Overlying the Tawallah Group, and forming a prominent escarpment in the north-western part of the project area, are the arenaceous sediments of the Masterton Sandstone, the lowest subdivision of the Parsons Range Group.

A NNW trending intrusion, the Packsaddle Microgranite, has been interpreted to be co-magmatic with the Hobble chain Rhyolite.

Possibly Cretaceous sediments derived from the Masterton Sandstone are patchily distributed throughout the region. Quaternary and Cainozoic alluvium and soils are also widely distributed, with thicknesses of about 10m over the Sandy Flat open pit.

Primary copper mineralisation in the Redbank area is in the form of steeply dipping to vertical, cylindrical to oval breccia pipes (Knutson et al., 1979). Some fifty possible breccia pipes have been identified in the area, although detailed drilling and resource estimates have only been completed for quartz, chlorite, celadonite, hematite, potassium feldspar and apatite, with minor barite, rutile, galena and pyrobitumen. The majority of the breccia fragments are derived from the surrounding MCB sediments and volcanic.

The breccia pipes were formed by the release of fluids from a carbonated trachytic magma 2-3km below the surface. Mineralogical and textural evidence reported by Knutson et al (1979) suggests that the fluids were enriched in K, Cl, P, Mg, Ce, La, CO2 and H2O.

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The mineralogy of the Sandy Flat deposit has been studied in detailed by McLaughlin et al (2000). In the upper oxidised zone, copper minerals include azurite, malachite, native copper, chalcotrichite, libethenite, pseudomalachite and chrysocolla. Chalcocite is common at the base of the oxidised zone. The primary mineralisation is predominantly chalcopyrite and pyrite, with minor pyrrhotite and arsenopyrite. Pyrobitumen is also found at the base of the oxidised zone, and is thought to represent pyrolysed petroleum or highly reduced carbonate rocks.

Proterozoic Stratigraphy of the Redbank area

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Redbank Copper Project Development

Mineralisation at Redbank occurs in breccia pipes which are capped with a shallow (~35m deep) oxide zone and is underlain by sulphide mineralisation. The focus of mining and exploration has so far been on these oxide orebodies. It is believed that only about 15% of the tenement area has been explored using modern techniques.

When creating mineralized domains for the Bluff deposit a core shell of 2% total copper was selected using Leapfrog software. This mineralized domain was shown to contain grades higher than 2% copper and extended throughout the vertical extent of the mineralized zone. Other similarly endowed pipes could exist containing similar or even higher grades of copper.

Processing the oxide ore is expected to be by crushing, leaching with sulphuric acid to produce copper cement (85-90% Cu) or maybe copper cathode (99.9%) if the provision of a solvent extraction electrowinning plant can be justified. The copper sulfides could be crushed and milled ready for flotation to create a concentrate of approximately 25% copper which would then be despatched for smelting and refining.

Although copper is presently the metal of main interest to Redbank, the general RCP Operations tenement holdings are in areas also prospective for gold, silver, lead, zinc, cobalt, uranium, manganese and phosphates.

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VALUATION ASSESSMENT

The Redbank Copper Projects has estimated Mineral Resources or Exploration Targets. When a resource or defined body of mineralisation has been outlined and its economic viability has still to be established (i.e. there is no ore reserve) then a Comparable Transactions approach is usually applied, often stated as a percentage of metal value. This can be applied to Mineral Resource estimates and Exploration Targets in accordance with the JORC code with appropriate discounts for risk in the different categories.

With gold projects the method requires allocating a dollar value to resource ounces of gold in the ground. This may also apply to well established zones of mineralisation which have not formally been categorised under the JORC code. An additional risk weighting may be appropriate in these circumstances.

A similar approach can be taken with other metals including copper or base metals sold on the spot market and benchmarks are similar to gold properties. Value is estimated as a percentage of contained value once appropriate discounts for uncertainty relating to resource categorisation are taken into account.

The Mineral Resources are assumed to encapsulate all the value for Mining Leases and Miscellaneous Licences and a separate value for exploration potential for these tenements is not considered warranted.

The Copperado, Redbank, Calvert, Benmara, Seigal, and McDermott Projects are exploration projects. Several methods of valuation are available for such projects where a Mineral Resource has not yet been estimated in accordance with the JORC code. These include the use of valuations based on past exploration expenditure and valuations based on perceived prospectivity.

Exploration projects can be extremely variable and the use of comparable transactions is unlikely to produce a statistical spread of values for “similar” projects. This method can be used where a Mineral Resource has been estimated. The Prospectivity Exploration Multiplier (PEM) is based on past expenditure while the Kilburn Geoscience Rating (Geo-factor Rating) is based on opinions of the prospectivity hence tenements can have marked variation in value between the methods.

The ‘Geo-factor Rating’ method of valuation for exploration tenements is the preferred valuation method for the Company’s current tenements as it focusses on the future prospectivity of the area.

The Geo-factor Rating method systematically assesses and grades of four key technical attributes of a tenement to arrive at a series of multiplier factors. The Basic Acquisition Cost (BAC) is the important input to the method and it is calculated by summing the application fees, annual rent, work required to facilitate granting (e.g. native title, environment etc) and statutory expenditure for a period of 12 months. This is usually expressed as average expenditure per square kilometre. Equity and grant status are also taken into account. Each factor then multiplied serially to the BAC. The ‘Base Value is multiplied by the prospectivity rating (the assessment of prospectivity factors multiplied together) to establish the overall technical value of each mineral property.

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Where exploration has produced documented results a PEM can be derived which takes into account the valuer’s judgment of the success of the previous exploration techniques and results.

Paragraph 65 of RG 111 discusses a preference for the use of more than one valuation methodology. In the absence of a resource estimate in accordance with the JORC code an alternative method to the Geo-factor Rating method might consider past expenditure on the tenements and the uplift of value provided by encouraging result.

Past expenditures for the Company’s current tenements are not available from the previous explorers of the same ground over the duration of modern exploration and reliance is mainly placed on the Geo-factor method.

COMPARABLE TRANSACTIONS – REDBANK COPPER DEPOSIT

MINERAL RESOURCE ESTIMATES

A resource estimate in accordance with the JORC code has been compiled for the Carnegie project and has been announced to the ASX in past releases and reports and is accepted here for the purpose of the valuation.

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VALUATION METHODOLOGY

Contained metal is calculated from the deposit tonnes and grade in the categories of the JORC code. The estimated contained value for the Inferred Resource is estimated based on current metal prices. The current copper Price is estimated at approximately A$7,400 per tonne in mid June 2012.

A discount factor is applied to the contained value to recognise the JORC category and allow for resource risk. The base value for the project is estimated by multiplying the contained value by the discount factors. A further discount is also applied to the contained value to recognise the project operational factors which relate to copper deposits.

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Resource Category Discounts
Measured Resource	80%
Indicated Resource	70%
Inferred Resource	60%
Exploration Target	50%
Operations Factors	Base Metals
Recovery	100%
Mining	100%
Processing	90%
Rail	90%
Port	90%
Capex	90%
Marketing	90%
Total Operating Discount	59%

Base Value = [Contained metal][Value of copper per tonne][Resource Discount]

Base Value A$M
Measured	-
Indicated	131.03
Inferred	139.44
Exploration Target	-
Total	270.47
A$ pertonne	$2,814.37

Average Acquisition Cost

A range of average acquisition cost (AAC) percentages is estimated based on a database of comparative transactions in the mineral industry over the last 20 years. The percentage represents the amount paid for deposits as a proportion of the contained value adjusted for the uncertainty of the Category assigned under the JORC code.

The Average Acquisition Cost (AAC) for projects lies in the range of 2% to 4.5%. The data set does not differentiate between resource categories and it is implicit that this has been taken into account with risk related discounts. Information on sales internationally has shown a pattern for the AAC as shown in the chart and percentile table.

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Average Acquisition Cost
AAC Percentiles
Percentile 10th 25th 50th 75th 90th
AAC 2.2% 2.6% 3.0% 3.6% 3.9%
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For the purpose of this valuation the Average Acquisition Cost for the lower, preferred and higher value is selected at the 25[th] , 50[th] and 75[th] percentiles. The Base Value is multiplied by AAC Percentiles to arrive at the estimated project technical value.

Technical Value

Technical Value = [Base Value]*[Average Acquisition Cost%]

Total Project Technical Value, A$M
Low	7.10
High	9.06
Preferred	8.11
% of contained value	1.14%
A$ per tonne	$84.43

Market Value

In arriving at a fair market value for a particular exploration tenement, I have considered the current market for exploration properties in Australia and overseas. It is considered appropriate to apply a significant discount to the technical value of the Mineral Resources.

The current market value for mineral projects in Australia is considered to be depressed and a market factor of 5 to 10 % has been applied to the technical value for Redbank Deposit

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Market Value = [Technical Value]*[Adjusted Market Factor]

Total Project Market Value, A$M
Low	6.39
High	8.61
Preferred	7.50
% of contained value	1.05%
A$ per tonne	$78.03

GEO-FACTOR RATING METHOD

BASE VALUE

This represents the exploration cost for the current period of the tenements. The current Base Acquisition Cost (BAC) for exploration projects is considered to be the average expenditure for the first year of the licence tenure. Exploration Licences in, attract a minimum annual expenditure for the first three years of $300 per square kilometre and annual rent of $43.50. A 10% administration fee is taken into account to imply a BAC of $360 to $400 per square kilometre. A similar approach based on expenditure commitments is taken for Prospecting Licences and Mining Leases. It is considered that exploration expenditures in the Northern Territory are analogous to those in Western Australia for similar classes of tenure.

	Licence Type Expend. Rent Admin Total $/km2 BAC - Low BAC - High Exploration Licence (E, $/km2) 300 43.50 34.35 377.85 378 360 400 Prospecting Licences (P, $/Ha) 40.00 2.20 4.22 46.42 4,642 4,400 4,900 Mining Lease (M, $/Ha) 100.00 15.00 11.50 126.50 12,650 12,000 13,300

The Company has 100% equity in all tenements. All tenements except for the Other Projects are granted as shown in the tenement schedule. A 40% discount is applied to applications.

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Base Value = [Area][Grant Factor][Equity]*[Base Acquisition Cost]

Tenement Factors
Tenement Location State Equity Km2 Status Grant
	Base Value
	Low High
EL28288 Redbank NT 100% 327.60 Granted 100%	118,000 131,000
EL28290 Redbank NT 100% 100.80 Granted 100%	36,000 40,000
EL24654 Copperado NT 100% 315.00 Granted 100%	113,000 126,000
EL28289 Copperado NT 100% 37.80 Granted 100%	14,000 15,000
EL26778 Calvert NT 100% 330.75 Granted 100%	119,000 132,000
EL26779 Calvert NT 100% 173.25 Granted 100%	62,000 69,000
EL26780 Calvert NT 100% 204.75 Granted 100%	74,000 82,000
EL26781 Calvert NT 100% 34.65 Granted 100%	12,000 14,000
EL27240 Calvert NT 100% 59.85 Granted 100%	22,000 24,000
EL27241 Calvert NT 100% 321.30 Granted 100%	116,000 129,000
EL27737 Calvert NT 100% 50.40 Granted 100%	18,000 20,000
EL28003 Siegal NT 100% 110.25 Granted 100%	40,000 44,000
EL26965 Benmarra NT 100% 233.10 Granted 100%	84,000 93,000
EL26999 Benmarra NT 100% 425.25 Granted 100%	153,000 170,000
EL28487 McDermott NT 100% 510.30 Granted 100%	184,000 204,000
EL28535 McDermott NT 100% 66.15 Granted 100%	24,000 26,000
3,301.20	1,189,000 1,319,000

PROSPECTIVITY ASSESSMENT FACTORS

An assessment of the prospectivity of tenements was carried out. This includes a consideration of

Regional mineralization, old and current workings and the validity of conceptual models.
Local mineralization within the tenements and the application of conceptual models within the tenements.
Identified anomalies warranting follow up within the tenements.
The proportion of structural and lithological settings within the tenements and difficulty encountered by cover rocks and other factors.

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KILBURN RATING CRITERIA - SIMPLIFIED

KILBURN RATING CRITERIA - SIMPLIFIED	KILBURN RATING CRITERIA - SIMPLIFIED	KILBURN RATING CRITERIA - SIMPLIFIED	KILBURN RATING CRITERIA - SIMPLIFIED	KILBURN RATING CRITERIA - SIMPLIFIED
Rating	Off Site Factor	On Site Factor	AnomalyFactor	Geological Factor
1	Indications of Prospectivity	Indications of Prospectivity	No targets outlined	Generally favourable geological environment
2	Resource targets Identified	Targets identified with successful earlydrilling	Exposure of mineralised zones or surface drilling (RAB)	Generally favourable lithology with structures or exposures of mineralised zones
3	Along Strike or adjacent to known mineralization	Grade intercepts on adjacent sections - Exploration Targets Estimated from sound evidence	Significant grade intercepts not yet linked on cross and longsections	Significant mineralised zones exposed in prospective host rocks
4		Inferred Resource identified not yet estimated	Grade intercepts on adjacent sections

Assessments in each category are based on a set scale (see above and appendix) and are multiplied together to arrive at a “prospectivity index”.

Prospectivity Index = [Off Site Factor][On Site Factor][Anomaly Factor]*[Geology Factor]

*Base Value = [Area][Grant Factor][Equity][Base Acquisition Cost]**	*Base Value = [Area][Grant Factor][Equity][Base Acquisition Cost]**
Prospectivity Factors
Tenement Project	Off Site On Site Anomaly Geology
	Low High Low High Low High Low High
EL28288 Redbank	1.50 1.60 1.25 1.35 1.50 1.60 1.50 1.60
EL28290 Redbank	1.50 1.60 1.25 1.35 1.50 1.60 1.50 1.60
EL24654 Copperado	1.35 1.45 1.25 1.35 1.50 1.60 1.50 1.60
EL28289 Copperado	1.35 1.45 1.25 1.35 1.50 1.60 1.50 1.60
EL26778 Calvert	1.35 1.45 1.25 1.35 1.50 1.60 1.50 1.60
EL26779 Calvert	1.35 1.45 1.25 1.35 1.50 1.60 1.50 1.60
EL26780 Calvert	1.35 1.45 1.25 1.35 1.50 1.60 1.50 1.60
EL26781 Calvert	1.35 1.45 1.25 1.35 1.50 1.60 1.50 1.60
EL27240 Calvert	1.35 1.45 1.25 1.35 1.50 1.60 1.50 1.60
EL27241 Calvert	1.35 1.45 1.25 1.35 1.50 1.60 1.50 1.60
EL27737 Calvert	1.35 1.45 1.25 1.35 1.50 1.60 1.50 1.60
EL28003 Siegal	1.20 1.30 1.00 1.10 1.00 1.10 1.50 1.60
EL26965 Benmarra	1.20 1.30 1.00 1.10 1.00 1.10 1.50 1.60
EL26999 Benmarra	1.20 1.30 1.00 1.10 1.00 1.10 1.50 1.60
EL28487 McDermott	1.20 1.30 1.00 1.10 1.00 1.10 1.50 1.60
EL28535 McDermott	1.20 1.30 1.00 1.10 1.00 1.10 1.50 1.60

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TECHNICAL VALUE

An estimate of technical value has been compiled for the tenements based on the base acquisition cost, area, grant status, equity and ratings for prospectivity.

Technical Value = [Base Value][Prospectivity Index]*

Technical Value
Tenement	Project		Technical Value, $m
		Low	High	Preferred
EL28288	Redbank	0.50	0.72	0.61
EL28290	Redbank	0.15	0.22	0.19
EL24654	Copperado	0.43	0.63	0.53
EL28289	Copperado	0.05	0.08	0.06
EL26778	Calvert	0.45	0.66	0.56
EL26779	Calvert	0.24	0.35	0.29
EL26780	Calvert	0.28	0.41	0.35
EL26781	Calvert	0.05	0.07	0.06
EL27240	Calvert	0.08	0.12	0.10
EL27241	Calvert	0.44	0.65	0.54
EL27737	Calvert	0.07	0.10	0.08
EL28003	Siegal	0.07	0.11	0.09
EL26965	Benmarra	0.15	0.23	0.19
EL26999	Benmarra	0.28	0.43	0.35
EL28487	McDermott	0.33	0.51	0.42
EL28535	McDermott	0.04	0.07	0.05
		3.61	5.36	4.48

Exploration Tenements – Alternative Valuation Methods:

There is a preference for the use of more than one valuation methodology for the same tenements expressed in Paragraph 65 of Regulatory Guide 111. An alternative method to the Geo-factor Rating method might consider past expenditure on the tenements and the uplift of value provided by encouraging result indicated by the Prospectivity Enhancement Multiplier (PEM.

PEM Range Criteria

1.3 – 1.5 Exploration has considerably increased the prospectivity (geological mapping, geochemical or geophysical)

1.5 – 2.0 Scout Drilling has identified interesting intersections of mineralization 2.0 – 2.5 Detailed Drilling has defined targets with potential economic interest. 2.5 – 3.0 A resource has been defined at Inferred Resource Status, no feasibility study has been completed

Complete records of past expenditure for the Projects are not available from the previous explorers. The project has been extensively explored in the past with mapping, satellite imagery, geophysics, surface geochemistry and historical drilling forming part of the data base.

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It is considered reasonable to suggest that the current value of these work elements would be as shown in the following table. This is considered speculative (but plausible) and the successful results of the work indicate that detailed drilling has defined targets with potential economic interest with the potential to contain medium sized deposits and small Inferred Resources may be estimated. This would attract Prospectivity Enhancement Multipliers as set out below.

Technical Value - Prospectivity Enhancement Method	Technical Value - Prospectivity Enhancement Method	Technical Value - Prospectivity Enhancement Method
		PEM	Technical Value, A$M
	Expenditure A$M
Project
	Low	Low High	Low High	Preferred
Redbank	0.75	1.50 1.75	1.13 1.31	1.22
Copperado	0.75	1.50 1.75	1.13 1.31	1.22
Calvert	0.75	1.50 1.75	1.13 1.31	1.22
Siegal	0.50	1.25 1.50	0.63 0.75	0.69
Benmarra	0.50	1.25 1.50	0.63 0.75	0.69
McDermott	0.50	1.25 1.50	0.63 0.75	0.69
				5.72

MARKET VALUE

I have considered the Country risk and current market for exploration properties in Australia. An assessment of country risk and an assessment of the Business Climate have been provided by a specialist firm (source: www.coface.com). The rating for Australia is ‘A1’ for country risk and ‘A1’ for business climate which are considered to be low. This rating will affect the market factor in assessing market value.

The current market value for mineral projects in Australia is considered to be depressed and a market factor of 5% to 10 % has been applied to the technical value.

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Market Value = [Technical Value]*[Adjusted Market Factor]

Market Value


Tenement Project	Market Value, $m

	Market Premium	Low High Preferred
EL28288 Redbank	90.0% 95.0%	0.45 0.69 0.57
EL28290 Redbank	90.0% 95.0%	0.14 0.21 0.17
EL24654 Copperado	90.0% 95.0%	0.39 0.60 0.49
EL28289 Copperado	90.0% 95.0%	0.05 0.07 0.06
EL26778 Calvert	90.0% 95.0%	0.41 0.63 0.52
EL26779 Calvert	90.0% 95.0%	0.21 0.33 0.27
EL26780 Calvert	90.0% 95.0%	0.25 0.39 0.32
EL26781 Calvert	90.0% 95.0%	0.04 0.07 0.05
EL27240 Calvert	90.0% 95.0%	0.08 0.11 0.09
EL27241 Calvert	90.0% 95.0%	0.40 0.61 0.50
EL27737 Calvert	90.0% 95.0%	0.06 0.10 0.08
EL28003 Siegal	90.0% 95.0%	0.06 0.11 0.09
EL26965 Benmarra	90.0% 95.0%	0.14 0.22 0.18
EL26999 Benmarra	90.0% 95.0%	0.25 0.41 0.33
EL28487 McDermott	90.0% 95.0%	0.30 0.49 0.39
EL28535 McDermott	90.0% 95.0%	0.04 0.06 0.05
		3.25 5.09 4.17

VALUATION SUMMARY

Redbank Deposit – Mineral Resources

Total Project Market Value, A$M
Low	6.39
High	8.61
Preferred	7.50
% of contained value	1.05%
A$ pertonne	$78.03

Exploration Potential - Market Value

Project	Low	High	Preferred
Redbank	0.59	0.90	0.74
Copperado	0.43	0.67	0.55
Calvert	1.45	2.24	1.84
Siegal	0.06	0.11	0.09
Benmarra	0.38	0.63	0.51
McDermott	0.34	0.55	0.44
	3.25	5.09	4.17

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VALUATION OPINION

Based on an assessment of the factors involved I estimate the value for exploration projects to be in the range A$9.6 million to A$13.7 million with a preferred value of A$11.7 million. This valuation is effective on 14[th] June 2012.

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APPENDIX

MINERAL ASSETS VALUATION METHODOLOGY FOR EXPLORATION TENEMENTS

FAIR MARKET VALUE OF MINERAL ASSETS

Mineral assets include, but are not limited to, mining and exploration tenements held or acquired in connection with the exploration, the development of, and the production from those tenements together with all plant, equipment and infrastructure owned or acquired for the development, extraction and processing of minerals in connection with those tenements.

Mineral assets classification	Mineral assets classification
Exploration areas	Mineralization may or may not have been identified, but where a mineral resource has not been defined.
Advanced exploration areas	Mineral resources have been identified and their extent estimated (possibly incompletely). This includesproperties at the earlystage of assessment.
Pre-development projects	A positive development decision has not been made. This includes properties where a development decision has been negative, properties on care and maintenance and properties held on retention titles.
Development projects	Committed to production, but which, are not yet commissioned or not initially operating at design levels.
Operating Mines	Mineral properties, particularly mines and processing plants, which have been fully commissioned and are inproduction.

The fair market value of a mineral asset is the estimated amount of money or the cash equivalent or some other consideration for which the mineral asset should change hands between a willing buyer and a willing seller in an arm’s length transaction. Each party is assumed to have acted knowledgeably, prudently and without compulsion.

The value of a mineral asset usually consists of two components,

The underlying or Technical Value which is an assessment of a mineral asset’s future net economic benefit under a set of appropriate assumptions, excluding any premium or discount for market, strategic or other considerations.
The Market Component, which is a premium relating to market, strategic or other considerations which, depending on circumstances at the time, can be either positive, negative or zero.

When the technical and market components of value are combined the resulting value is referred to as the market value. A consideration of country risk should also be taken into account for overseas projects.

The value of mineral assets is time and circumstance specific. The asset value and the market premium (or discount) changes, sometimes significantly, as overall market conditions, commodity prices, exchange rates, political and country risk change.

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REGULATORY AUTHORITIES

Mineral asset valuations are governed by the VALMIN code and ASIC Practice Note 43 in Australia and by the CIMVAL code, NI43-101 and TSXV Appendix 3G in Canada

THE VALMIN CODE

The four main requirements of the VALMIN Code are

Transparency The report needs to explain how the valuation was done and the assumptions used in calculating the value. The objective is to provide sufficient information that other people can come up with the same answer.

Materiality This means the valuer has to ensure that all important data that could have a significant impact on the valuation is included in the report.

Competence The valuer must be competent at doing valuations. The person needs to be an expert in the particular exploration target being evaluated. Typically the person needs at least 5 years’ experience in that commodity.

Independence . The valuer must act in a professional manner and not favour the buyer or the seller. In other words the price must be set at a “fair market value”. To achieve independence, the valuer must not receive any special benefit from doing the study.

The decisions as to the valuation methodology or methodologies to be used and the content of the Report are solely the responsibility of the Expert or Specialist whose decisions must not be influenced by the Commissioning Entity. The Expert or Specialist must state the reasons for selecting each methodology used in the Report. Methods chosen must be rational and logical and be based upon reasonable grounds.

The Expert or Specialist should make use of valuation methods suitable to the Mineral or Petroleum Assets or Mineral or Petroleum Securities under consideration. Selection of the appropriate valuation method will depend on, inter alia:

(a) the purpose of the Valuation;
(b) the development status of the Mineral or Petroleum Assets;
(c) the amount and reliability of relevant information;
(d) the risks involved in the venture; and
(e) the relevant market conditions for commodities and/or shares.

The Expert or Specialist should choose, discuss and disclose the selected valuation method(s) appropriate to the Mineral or Petroleum Assets or Mineral or Petroleum Securities under consideration, stating the reasons why the particular valuation method(s) have been selected in relation to those factors set out in Paragraph 39 and to the adequacy of available data. It may also

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be desirable to discuss why a particular valuation method has not been used. The disclosure should give a sufficient account of the valuation method(s) used so that another Expert could understand the procedure used and assess the Valuation. Should more than one valuation method be used and different valuations result, the Expert or Specialist should comment on the reason(s) for selecting the Value adopted.

Australian Securities and Investment Commission – Regulatory Guides RG111 and RG112

It is not the ASIC’s role or intention to limit the expert’s exercise of skill and judgment in selecting the most appropriate method or methods of valuation. However, it is appropriate for the expert to consider:

(a) the discounted cash flow method;
(b) the amount which an alternative acquirer might be willing to offer if all the securities in the target company were available for purchase;

The ASIC does not suggest that this list is exhaustive or that the expert should use all of the methods of valuation listed above. The expert should justify the choices of valuation method and give a sufficient account of the method used to enable another expert to replicate the procedure and assess the valuation. It may be appropriate for the expert to compare the figures derived by more than one method and to comment on any differences.

The complex valuations in an expert’s report necessarily contain significant uncertainties. Because of this an expert who gives a single point value will usually be implying spurious accuracy to his or her valuation. An expert should, however, give as narrow a range of values as possible. An expert report becomes meaningless if the range of values is too wide. An expert should indicate the most probable point within the range of values if it is feasible to do so.

The expert should carry out sufficient enquiries or examinations to establish reasonable grounds for believing that any profit forecasts, cash flow forecasts and unaudited profit figures that are used in the expert’s report, and have been prepared on a reasonable basis. If there are material variations in method or presentation the expert should adjust for or comment on them in the report.

The expert should discuss the implications to his or her valuation if:

(a) the current market value of the subject of the report is likely to change because of market volatility (for example, boom or depression); or
(b) the current market value differs materially from that derived by the chosen method.

VALUATION METHODOLOGY FOR EXPLORATION TENEMENTS

Valuation of exploration properties is exceptionally subjective. If an economic resource is subsequently identified then a new valuation will be dramatically higher, or alternatively if expenditure of further exploration dollars is unsuccessful then it is likely to decrease the value of the Tenements. There are a number of generally accepted procedures for establishing the value of exploration properties and, where relevant, the use of more than one such method to enable a

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balanced analysis and a check on the result has been undertaken. The value will always be presented as a range with the preferred value identified. The preferred value need not be the median value, and will be determined by the Independent Expert based on his experience.

The Independent Expert, when determining a value for a mineral asset, must assess a range of technical issues prior to selection of a valuation methodology. Often this will require seeking advice from a specialist in specific areas. The key issues are:

geological setting and style of mineralization
level of knowledge of the geometry of mineralization in the district
mining history, including mining methods
location and accessibility of infrastructure
milling and metallurgical characteristics of the mineralization
results of exploration including geological mapping, costeaning and drilling of interpretation of geochemical anomalies
parameters used to identify geophysical and remote sensing data anomalies
location and style of mineralization identified on adjacent properties
appropriate geological models

In addition to these technical issues the Independent Expert needs to make a judgement about the market demand for the type of property, commodity markets, financial markets and stock markets. The technical value of a property should not be adjusted by a “market factor” unless there is a marked discrepancy between the technical value and the market value. When this is done the factor should be clearly identified.

Where there are identified reserves it is appropriate to use financial analysis methods to estimate the net present value (NPV) of the properties. This technique has deficiencies which include assessment of only a very narrow area of risk, namely the time value of money given the real discount rate, and the underlying assumption that a static approach is applicable to investment decision making, which is clearly not the case.

When assessing value of exploration properties with no identified mineral resources or only inferred resources it is inappropriate to prepare any form of financial analysis to determine the net present value. The valuation of exploration tenements or licences, particularly those without identified resources, is highly subjective and a number of methods are appropriate to give a guide as discussed below.

All of these valuation methods are relatively independent of the location of the mineral property. Consequently the valuer will make allowance for access to infrastructure etc when choosing a preferred value. It is observed that the Prospectivity Exploration Multiplier (PEM) is heavily based on

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the expenditure, while the Kilburn Geoscience Rating (Kilburn) is more heavily based on opinions of the prospectivity hence tenements can have marked variation in value between the methods. If the Kilburn assessment is high and the PEM is low it indicates effective well focussed exploration, if the Kilburn is low and the PEM high it suggests that the tenement is considered to have lower prospectivity.

PROSPECTIVITY ENHANCEMENT MULTIPLIER (PEM) OR MULTIPLE OF EXPLORATION EXPENDITURE (MEE)

Past expenditure on a tenement and/or future committed exploration expenditure can establish a base value from which the effectiveness of exploration can be assessed. Where exploration has produced documented results a PEM can be derived which takes into account the valuer’s judgment of the prospectivity of the tenement and the value of the database.

PEM Factors Used in this valuation method

PEM Range	Criteria
0.2 – 0.5	Exploration (past and present) has downgraded the tenement prospectivity, no mineralization identified
0.5 – 1.0	Exploration potential has been maintained (rather than enhanced) by past and present activity from regional mapping
1.0 – 1.3	Exploration has maintained, or slightly enhanced (but not downgraded) the prospectivity
1.3 – 1.5	Exploration has considerably increased the prospectivity (geological mapping, geochemical or geophysical)
1.5 – 2.0	Scout Drilling has identified interesting intersections of mineralization
2.0 – 2.5	Detailed Drilling has defined targets with potential economic interest.
2.5 – 3.0	A resource has been defined at Inferred Resource Status, no feasibility study has been completed
3.0 – 4.0	Indicated Resources have been identified that are likely to form the basis of a prefeasibility study
4.0 – 5.0	Indicated and Measured Resources have been identified and economic parameters are available for assessment.

Future committed exploration expenditure is discounted to 60% by some valuers to reflect the uncertainty of results and the possible variations in exploration programmes caused by future undefined events. Expenditure estimates for tenements under application are often discounted to 60% of the estimated value by some valuers to reflect uncertainty in the future granting of the tenement. The PEM Factors are defined in the table.

GEO-FACTOR RATING METHOD (KILBURN)

Valuation is based on a calculation in which the geological prospectivity, commodity markets, financial markets, stock markets and mineral property markets are assessed independently. The Kilburn method is essentially a technique to define a value based on geological prospectivity. The method appraises a variety of mineral property characteristics:

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location with respect to any off‐property mineral occurrence of value, or favourable geological, geochemical or geophysical anomalies;
location and nature of any mineralization, geochemical, geological or geophysical anomaly within the property and the tenor of any mineralization known to exist on the property being valued;
number and relative position of anomalies on the property being valued;
geological models appropriate to the property being valued.

The Method systematically assesses and grades these four key technical attributes of a tenement to arrive at a series of multiplier factors. The Basic Acquisition Cost (BAC) is the important input to the Kilburn Method and it is calculated by summing the annual rent, statutory expenditure for a period of 12 months and administration fees.

The current Base Acquisition Cost (BAC) for exploration projects is considered to be the average expenditure for the first year of the licence tenure. Exploration Licences in Western Australia, for example, attract a minimum annual expenditure for the first three years of $300 per square kilometre and annual rent of $43.50. A 10% administration fee is taken into account to imply a BAC of $360 to $400 per square kilometre. A similar approach based on expenditure commitments is taken for Prospecting Licences and Mining Leases

	Licence Type Expend. Rent Admin Total $/km2 BAC - Low BAC - High Exploration Licence (E, $/km2) 300 43.50 34.35 377.85 378 360 400 Prospecting Licences (P, $/Ha) 40.00 2.20 4.22 46.42 4,642 4,400 4,900 Mining Lease (M, $/Ha) 100.00 15.00 11.50 126.50 12,650 12,000 13,300

The multipliers or ratings and the criteria for rating selection across these four factors are summarised in the following table.

KILBURN GEO-FACTOR RATING CRITERIA - MODIFIED

			Mineralization - On
	Rating	Address - Off Property	Property	Anomalies	Geology
Low	0.5	Very little chance of mineralization, Concept unsuitable to environment	Very little chance of mineralization, Concept unsuitable to environment	Extensive previous exploration with poor results - no encouragement	Generally Unfavourable lithology
		Indications of	Indications of	Extensive previous	Deep alluvium
Average	1	Prospectivity, Concept	Prospectivity, Concept	exploration with	Covered Generally
		validated	validated	encouraging results -	favourable geology

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				regional targets
	1.5	RAB Drilling with some scattered results	Exploratory sampling with encouragement, Concept validated	Several early stage targets outlined from geochemistry and geophysics	Shallow alluvium Covered Generally favourable geology (50-60%)
	2	Significant RC drilling leading to advance project status	RAB &/or RC Drilling with encouraging intercepts reported	Several well defined surface targets with some RAB drilling	Exposed favourable lithology (60-70%)
	2.5	Grid drilling with encouraging results on adjacent sections	Diamond Driing after RC with encouragement	Several well defined surface targets with encouraging drilling results	Strongly favourable lithology (70-80%)
High	3	Resource areas identified	Advanced Resource definition drilling - early stage	Several significant subeconomic targets - no indication of volume	Highly prospective geology (90 - 100%)
	3.5	Along strike or adjacent to known mineralization at Pre-Feasibility Stage	Resource areas identified	Subeconomic targets of possible significant volume - early stage drilling
	4	Along strike or adjacent to Resources at Definitive Feasibility Stage	Along strike or adjacent to known mineralization at Pre-Feasibility Stage	Marginal economic targets of significant volume - advanced drilling
	4.5	Along strike or adjacent to Development Stage Project	Along strike or adjacent to Resources at Definitive Feasibility Stage	Marginal economic targets of significant volume - well drilled at Inferred Resource srage
Very High	5	Along strike or adjacent to Operating Mine	Along strike or adjacent to Development Stage Project	Several significant ore grade correlatable intersections with estimated resources

Estimate of project value is carried out on a tenement by tenement basis and uses four calculations as shown below. The value estimate is shown as a range with a preferred value.

Base Value = [Area][Grant Factor][Equity]*[Base Acquisition Cost]

Prospectivity Index = [Off Site Factor][On Site Factor][Anomaly Factor]*[Geology Factor]

Technical Value = [Base Value]*[Prospectivity Index]

Market Value = [Technical Value]*[ Market Premium Factor]

VALUATION OF RESOURCES BY COMPARABLE TRANSACTIONS

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If a property in the recent past was the subject of an arms-length transaction, for either cash or shares (i.e. from a company whose principal asset was the mineral property) then this forms the most realistic starting point, provided that the deal is still relevant in today’s market. Complicating matters is the knowledge that properties rarely change hands for cash, except for liquidation purposes, estate sales, or as raw exploration property when sold by an individual prospector, or entrepreneur.

Any underlying royalty or net profits interests or rights held by the original vendor of the claims should be deducted from the resultant property value before determination of the company’s interest. Also, reductions in value should be made where environmental, legal or political sensitivities could seriously retard the development of exploration properties.

It should be noted again that exploration is cyclical, and in periods of low metal prices there is often no market, or a market at very low prices, for ordinary exploration acreage (inventory property) unless it is combined with a significant mineral deposit, or with other incentives.

Truly Comparable Transactions are rare for early stage properties without defined drill targets. This is natural in a recession, as companies focus on brownfields exploration. Inflated prices paid for property in fashionable areas should not be discounted because they reflect the true market value of a property at the transaction date. If however, the market sentiment is not so buoyant then adjustments must be made.

When only a resource or defined body of mineralisation has been outlined and its economic viability has still to be established (i.e. there is no ore reserve) then a Comparable Transactions approach is usually applied, often stated as a percentage of metal value. This can be applied to Mineral Resource estimates and Exploration Targets in accordance with the JORC code with appropriate discounts for risk in the different categories.

Resource Category Discounts
Measured Resource	80%
Indicated Resource	70%
Inferred Resource	60%
Exploration Target	50%

The dollar value must take into account a number of aspects of the resources including:

The confidence in the resource estimation (the JORC Category).
The quality of the resource (grade and recovery characteristics)

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Possible extensions of the resource in adjacent areas
Exploration potential for other mineralisation within the tenements
Presence and condition of a treatment plant within the project
Proximity of toll treatment facilities, infrastructure, development and capital expenditure aspects

A similar approach can be taken with other metals including uranium or base metals sold on the spot market and benchmarks are similar to gold properties. Value is estimated as a percentage of contained value once appropriate discounts for uncertainty relating to resource categorisation are taken into account. An example of appropriate discounts for Rare Earths, Iron Ore and Base Metals is included below but these must be considered on a case-by-case basis.

Operations Factors	Rare Earths	Iron Ore	Base Metals
Recovery	60%	88.00%	100%
Mining	100%	90.00%	100%
Processing	50%	80.00%	90%
Rail	75%	80.00%	90%
Port	90%	70.00%	90%
Capex	50%	70.00%	90%
Marketing	75%	85.00%	90%
Total Operating Discount	7.6%	21.10%	59.0%

The AAC for gold projects lies in the range of 2% to 5%. The data set does not differentiate between resource categories and it is implicit that this has been taken into account with risk related discounts. Information on sales internationally has shown a pattern for ‘Apparent Acquisition Cost’ (AAC) over the last twenty years as shown in the following chart.

Comparative transactions in the gold industry over the last 20 years

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Average Acquisition Cost
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For the purpose of valuation the Average Acquisition Cost for the lower, preferred and higher value is selected at the 25[th] , 50[th] and 75[th] percentiles.

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		AAC Percentiles
Percentile	10th	25th	50th	75th	90th
Average Acquisition Cost	2.2%	2.5%	3.0%	3.4%	3.9%
VALUATION REFERENCES

AusIMM, (2004), “Australasian Code for Reporting of Mineral Resources and Ore Reserves (JORC Code), prepared by the Joint Ore Reserves Committee (JORC) of the AusIMM, the Australian Institute of Geoscientists (AIG) and the Minerals Council of Australia (MCA)”, (The JORC Code) effective December 2004.

AusIMM. (2005), “Code for the Technical Assessment and Valuation of Mineral and Petroleum Assets and Securities for Independent Expert Reports (the VALMIN Code)” 2005 Edition.

AusIMM, (1998), “Valmin 94 – Mineral Valuation Methodologies”.

Barnett, D W and Sorentino, C, 1994. Discounted cash flow methods and the capital asset pricing model, in Proceedings Mineral Valuation Methodologies 1994 (VALMIN ‘94) pp 17‐35 (The Australasian Institute of Mining and Metallurgy: Melbourne).

CANADIAN INSTITUTE OF MINING, METALLURGY AND PETROLEUM, (2000), “CIM Standards on Mineral Resources and Reserves-Definitions and Guidelines”. Prepared by the CIM Standing Committee On Reserve Definitions. Adopted by CIM Council August 20, 2000.

CIM, (April 2001), “CIM Special Committee on Valuation of Mineral Properties (CIMVAL)” Discussion paper.

CIM, (2003) – “Standards and Guidelines for Valuation of Mineral Properties. Final Version, February 2003” Special Committee of the Canadian Institute of Mining, Metallurgy and Petroleum on Valuation of Mineral Properties (CIMVAL).

Goulevitch J and Eupene G S; 1994; Geoscience rating for valuation of exploration properties – applicability of the Kilburn Method in Australia and examples of its use; Proceedings of VALMIN 94; pages 175 to 189; The Australasian Institute of Mining and Metallurgy, Carlton, Australia.

Kilburn, LC, 1990, “Valuation of Mineral Properties which do not contain Exploitable Reserves” CIM Bulletin, August 1990.

Lawrence, M.J, 2007. Valuation methodology for Iron Ore Mineral Properties – thoughts of an Old Valuer: Iron ore Conference, Perth WA, 20 – 22 August 2007.

Rudenno, (1998), “The Mining Valuation Handbook”.

Rudenno, (2009), “The Mining Valuation Handbook” 3[rd] Edition.

Wellmer, F., 1989, “Economic Evaluations in Exploration”, Springer.

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Redbank Copper Limited

ABN 66 059 326 519

Lodge your vote:



By Mail:

Computershare Investor Services Pty Limited GPO Box 242 Melbourne Victoria 3001 Australia

Alternatively you can fax your form to (within Australia) 1800 783 447 (outside Australia) +61 3 9473 2555

For intermediary Online subscribers only (custodians) www.intermediaryonline.com

For all enquiries call:

(within Australia) 1300 850 505 (outside Australia) +61 3 9415 4000

Proxy Form

 For your vote to be effective it must be received by 10:00am (WST) Sunday 13 January 2013

How to Vote on Items of Business

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Appointment of Proxy

Voting 100% of your holding: Direct your proxy how to vote by marking one of the boxes opposite each item of business. If you do not mark a box your proxy may vote as they choose. If you mark more than one box on an item your vote will be invalid on that item.

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Signing Instructions

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the Chairman of the meeting

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PLEASE NOTE: Leave this box blank if you have selected the Chairman of the Meeting. Do not insert your own name(s).

or failing the individual or body corporate named, or if no individual or body corporate is named, the Chairman of the Meeting, as my/our proxy to act generally at the Meeting on my/our behalf and to vote in accordance with the following directions (or if no directions have been given, and to the extent permitted by law, as the proxy sees fit) at the General Meeting of Redbank Copper Limited to be held on the Ground Floor, 3 Richardson Street, West Perth, Western Australia on Tuesday, 15 January 2013 at 10:00am (WST) and at any adjournment or postponement of that Meeting.

 PLEASE NOTE: If you mark the Abstain box for an item, you are directing your proxy not to vote on your behalf on a show of hands or a poll and your votes will not be counted in computing the required majority.

Items of Business

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ORDINARY BUSINESS

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1 Approval of issue of placement securities to Investmet as underwriter or placee, Michael Fotios and their respective associates
2 Approval of placement securities to sophisticated investors 3 Approval for Investmet acquisition of relevant interest in shares from Stirling Resources 4 Approval of issue of securities to Stirling Resources 5 Approval of placement securities to Damian Delaney 6 Approval of placement securities to Martin Depisch 7 Approval of placement securities to Thomas Styblo 8 Approval of placement securities to Gerhard Kornfeld 9 Approval of placement securities to Peter Farris 10 Section 195 approval

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The Chairman of the Meeting intends to vote undirected proxies in favour of each item of business.

SIGN

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Individual or Securityholder 1 Securityholder 2 Securityholder 3
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1 5 9 9 6 4 A

AI assistant

NT MINERALS LIMITED — Proxy Solicitation & Information Statement 2012

65450_rns_2012-12-16_b128c4d1-2e94-4eb2-abcf-ce341ff39633.pdf

ACN 059 326 519

NOTICE OF GENERAL MEETING, EXPLANATORY STATEMENT AND PROXY FORM

THIS DOCUMENT IS IMPORTANT

CONTENTS

NOTICE OF GENERAL MEETING

AGENDA

1 RESOLUTION 1 – APPROVAL OF ISSUE OF PLACEMENT SECURITIES TO INVESTMET AS UNDERWRITER OR PLACEE, MICHAEL FOTIOS AND THEIR RESPECTIVE ASSOCIATES

2 RESOLUTION 2 – APPROVAL OF PLACEMENT SECURITIES TO SOPHISTICATED INVESTORS

3 RESOLUTION 3 – APPROVAL FOR INVESTMET ACQUISITION OF RELEVANT INTEREST IN SHARES FROM STIRLING RESOURCES

4 RESOLUTION 4 – APPROVAL OF ISSUE OF SECURITIES TO STIRLING RESOURCES

5 RESOLUTION 5 – APPROVAL OF PLACEMENT SECURITIES TO DAMIAN DELANEY

6 RESOLUTION 6 – APPROVAL OF PLACEMENT SECURITIES TO MARTIN DEPISCH

7 RESOLUTION 7 – APPROVAL OF PLACEMENT SECURITIES TO THOMAS STYBLO

8 RESOLUTION 8 – APPROVAL OF PLACEMENT SECURITIES TO GERHARD KORNFELD

9 RESOLUTION 9 – APPROVAL OF PLACEMENT SECURITIES TO PETER FARRIS

10 RESOLUTION 10 – SECTION 195 APPROVAL

VOTING BY PROXY

Proxy Forms received later than this time will be invalid.

ENTITLEMENT TO ATTEND AND VOTE

EXPLANATORY STATEMENT

Introduction

Background to the Resolutions

About Investmet

Resolutions

Business of the Company post transaction

Independent Expert

Board Recommendation

1 RESOLUTIONS 1 AND 3 – APPROVAL OF PLACEMENT TO INVESTMET AS UNDERWRITER OR PLACEE, MICHAEL FOTIOS AND THEIR REPSECTIVE ASSOCIATES AND ACQUISITION OF RELEVANT INTEREST IN SHARES HELD BY STIRLING RESOURCES (HELD BY ITS WHOLLY OWNED SUBSIDIARY, STIRLING COPPER)

1.1 Corporations Act requirements

1.2 Information required by section 611 item 7 of the Corporations Act and ASIC Regulatory Guide 74

Identity of the persons proposing to make the acquisition, their associates and Relevant Interests

The maximum extent of the increase in the Voting Power in the Company that would result from the issue and acquisition of the Shares

Effect of Placement on control

Identity, associations with the associates and qualifications of any person who is intended to or will become a Director if the Shareholders agree to the allotment

Statement of associated parties’ respective intentions regarding the future of the Company if Shareholders pass Resolutions 1 to 10

Particulars of the proposed acquisitions and timing

An explanation of the reasons for the proposed allotment

The interests of the Directors in Resolutions 1 and 3

The identity of Directors who approved or voted against the Resolution

1.3 Listing Rule 10.11 requirements

Pro Forma Balance Sheet

Directors’ recommendation

Whether proposal is fair and reasonable

2 RESOLUTION 2 – APPROVAL OF PLACEMENT OF SECURITIES TO SOPHISTICATED INVESTORS

3 RESOLUTION 4 – APPROVAL OF ISSUE OF SECURITIES TO STIRLING RESOURCES

4 RESOLUTIONS 5, 6, 7, 8 AND 9 – APPROVAL OF PLACEMENT SECURITIES TO RELATED PARTIES (OR THEIR NOMINEES)

4.1 Background

4.2 Listing Rules and Corporations Act

Listing Rule 10.11

Section 208 Corporations Act

4.3 Information Requirements for Listing Rule 10.11

4.4 Directors’ recommendation

5 RESOLUTION 10 – SECTION 195 APPROVAL

6 ADDITIONAL INFORMATION

6.1 Share price

6.2 Effect on Capital Structure

6.3 Other material information

GLOSSARY

ANNEXURE A – MATERIAL TERMS OF THE RESTRUCTURE DEED

Material terms of the Placement

Other material terms

Conditions

ANNEXURE B – MATERIAL TERMS OF THE SWAN GOLD RESTRUCTURE DEED

ANNEXURE C – COMPANY’S CAPITAL STRUCTURE

ANNEXURE D – TERMS AND CONDITIONS OF SHARES

ANNEXURE E – INDEPENDENT EXPERT’S REPORT

1. Introduction and Background

2. Implications of the Proposals

3. Future Directions of Redbank

4. Basis of technical valuation of Redbank

4.2

Capitalised Maintainable Earnings / Discounted Cash Flows

4.3 Takeover Bid

4.4 Net Asset Backing and Wind-Up Value

4.5 Market Price of Redbank Shares

4.6 Preferred value of Redbank fully paid shares (range) to arrive at fairness conclusion

5. Premium for Control

NT MINERALS LIMITED Proxy Solicitation & Information Statement 2012

Technical Value = [Base Value][Prospectivity Index]*