PERSEUS MINING LIMITED — AGM Information 2009

Oct 26, 2009

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NOTICE OF ANNUAL GENERAL MEETING

NOTICE IS HEREBY GIVEN that the Annual General Meeting of Perseus Mining Limited (“Perseus” or the “Company”) will be held on Friday, 27 November 2009 at 3.00pm at the Holiday Inn City Centre, 788 Hay Street, Perth, Western Australia.

The enclosed Explanatory Memorandum accompanies and forms part of this Notice of Meeting.

AGENDA

ORDINARY BUSINESS

1. Financial Report for the Year Ended 30 June 2009

To receive and consider the financial report of the Company for the year ended 30 June 2009, together with the reports by the directors and auditors thereon.

To consider and, if thought fit, pass the following resolutions as ordinary resolutions

2. Resolution 1 – Adoption of Remuneration Report

“To adopt the Remuneration Report as set out in the Directors' Report section of the Annual Report for the financial year ended 30 June 2009.”

3. Resolution 2 – Re-Election of Sean Harvey

“That Mr Sean Harvey, having been appointed since the last annual general meeting and who retires in accordance with Clause 3.3 of the Constitution of the Company and, being eligible, offers himself for reelection, be and is hereby re-elected as a director of the Company.”

4. Resolution 3 – Re-Election of Michael Bohm

“That Mr Michael Bohm, having been appointed since the last annual general meeting and who retires in accordance with Clause 3.3 of the Constitution of the Company and, being eligible, offers himself for reelection, be and is hereby re-elected as a director of the Company.”

5. Resolution 4 – Re-Election of Rhett Brans

“That Mr Rhett Brans, who retires in accordance with Clause 3.6 of the Constitution of the Company and, being eligible, offers himself for re-election, be and is hereby re-elected as a director of the Company.”

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6. Resolution 5 – Ratification of prior option issue

"That, in accordance with ASX Listing Rule 7.4, this meeting ratifies the issue of 2,000,000 options to BGF Equities Pty Ltd to acquire ordinary fully paid shares on the terms and conditions in the Explanatory Memorandum."

Voting Exclusion : The Company will disregard any votes cast on this resolution by BGF Equities Pty Ltd, or any its associates. However, the Company will not disregard a vote if:

• a) it is cast by the person as a proxy for a person who is entitled to vote, in accordance with directions on the Proxy Form; or

• b) it is cast by the person chairing the Annual General Meeting as proxy for a person who is entitled to vote, in accordance with directions on the Proxy Form to vote as the proxy decides.

7. Resolution 6 – Ratification of prior securities issue

"That, in accordance with ASX Listing Rule 7.4, this meeting ratifies the issue of 2,000,000 shares and 2,000,000 options to Strategic Systems Pty Ltd as consideration for the purchase of shares in Central Ashanti Gold Ltd on the terms and conditions in the Explanatory Memorandum."

Voting Exclusion: The Company will disregard any votes cast on this resolution by Strategic Systems Pty Ltd, or any its associates. However, the Company will not disregard a vote if:

• a) it is cast by the person as a proxy for a person who is entitled to vote, in accordance with directions on the Proxy Form; or

• b) it is cast by the person chairing the Annual General Meeting as proxy for a person who is entitled to vote, in accordance with directions on the Proxy Form to vote as the proxy decides.

8. Resolution 7 – Ratification of option issue

"That, in accordance with ASX Listing Rule 7.4, this meeting ratifies the issue of 400,000 options made on 15 October 2009 to Mr Michael Bohm on the terms and conditions in the Explanatory Memorandum."

Voting Exclusion : The Company will disregard any votes cast on this resolution by Mr Michael Bohm, or any associate of his. However, the Company will not disregard a vote if:

• a) it is cast by the person as a proxy for a person who is entitled to vote, in accordance with directions on the Proxy Form; or

• b) it is cast by the person chairing the Annual General Meeting as proxy for a person who is entitled to vote, in accordance with directions on the Proxy Form to vote as the proxy decides.

9. Resolution 8 - Ratification of Prior Share Issue

"That, in accordance with ASX Listing Rule 7.4, this meeting ratifies the issue of 39,000,000 securities which, at the date of this notice of meeting had not been issued, are expected to be issued in the period up to the date of the Annual General Meeting, on the terms and conditions in the Explanatory Memorandum."

Voting Exclusion: The Company will disregard any votes cast on this Resolution by any person who may participate in the proposed issue and a person who may obtain a benefit, except a benefit solely in the capacity of a holder of ordinary securities and any associates of those persons. However, the Company need not disregard a vote

• (a) if it is cast by the person as a proxy for a person who is entitled to vote in accordance with the directions on the Proxy Form: or

• (b) 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.

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10. Resolution 9 – Approval for the Issue of Options to Director, Sean Harvey

“That, for the purposes of ASX Listing Rule 10.11 and all other purposes and subject to the passing of Resolution 2, the directors be authorised to issue up to a maximum of 600,000 options to subscribe for shares in the Company to Mr Sean Harvey or his nominee, the details of which are set out in the Explanatory Memorandum.”

Voting Exclusion : In accordance with the ASX Listing Rules and the Corporations Act, the Company will disregard any votes cast on this resolution by Mr T S Harvey or his associates. However, the Company will not disregard a vote if:

• (a) it is cast by the person as a proxy for a person who is entitled to vote, in accordance with directions on the Proxy Form; or

• (b) it is cast by the person chairing the Annual General Meeting as proxy for a person who is entitled to vote, in accordance with directions on the Proxy Form to vote as the proxy decides.

11. Resolution 10 – Non-Executive Directors Fees

“That, pursuant to clause 10.2 of the Company’s Constitution, aggregate non-executive Directors’ fees be increased from $200,000 per annum to $400,000 per annum.”

Voting Exclusion

In accordance with the ASX Listing Rules, the Company will disregard any votes cast on this resolution by Directors and any of their associates. However, the Company will not disregard a vote if:

• (a) it is cast by the person as a proxy for a person who is entitled to vote, in accordance with directions on the Proxy Form; or

• (b) it is cast by the person chairing the Annual General Meeting as proxy for a person who is entitled to vote, in accordance with directions on the Proxy Form to vote as the proxy decides.

GENERAL BUSINESS

12. To transact any other business which may lawfully be brought forward.

PROXIES

In accordance with section 249L of the Corporations Act 2001, members are advised that:

• each member has a right to appoint a proxy;

• the proxy need not be a member of the Company;

• a member who is entitled to cast two or more votes may appoint two proxies and may specify the proportion or number of votes each proxy is appointed to exercise. If no proportion or number is specified, then in accordance with section 249X(3) of the Corporations Act 2001, each proxy may exercise half of the votes.

In accordance with section 250BA of the Corporations Act 2001, the Company specifies the following information for the purposes of receipt of proxy appointments:

Registered Office: 30 LEDGAR ROAD BALCATTA, WESTERN AUSTRALIA 6021 Facsimile Number: (61 8) 9240 2406 Postal Address: P O Box 717 BALCATTA, WESTERN AUSTRALIA 6914

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Each member entitled to vote at the annual general meeting has the right to appoint a proxy to attend and vote at the meeting on his behalf. The member may specify the way in which the proxy is to vote on each resolution or may allow the proxy to vote at his discretion. The instrument appointing the proxy must be received by the Company at the address specified above at least 48 hours before the time notified for the meeting (proxy forms can be lodged by facsimile).

In accordance with regulation 7.11.37 of the Corporations Regulations 2001, the Company determines that ordinary shares held as at 5.00pm on 25 November 2009 will be taken, for the purposes of the annual general meeting, to be held by the persons who held them at that time.

BY ORDER OF THE BOARD

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S M Shah Company Secretary Perth, Western Australia 26 October 2009

Members who do not plan to attend the meeting are encouraged to complete and return a proxy form.

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ACN 106 808 986

PERSEUS MINING LIMITED

EXPLANATORY MEMORANDUM

1. INTRODUCTION

This Explanatory Memorandum has been prepared for the information of shareholders of Perseus Mining Limited (“ Perseus ” or the “ Company ”) in connection with the business to be conducted at the Company’s Annual General Meeting to be held on Friday, 27 November 2009 at 3.00pm at the Holiday Inn City Centre, 788 Hay Street, Perth, Western Australia.

This Explanatory Memorandum should be read in conjunction with the accompanying Notice of Meeting.

2. 2009 ANNUAL REPORT

In accordance with the requirements of the Company’s Constitution and the Corporations Act, the 2009 Annual Report will be tabled at the annual general meeting. Shareholders will have the opportunity of discussing the Annual Report and making comments and raising queries in relation to the Report.

Representatives from the Company’s auditors, HLB Mann Judd, will be present to take shareholders’ questions and comments about the conduct of the audit and the preparation and content of the audit report.

As you may be aware, changes to legislation mean that companies are no longer required to mail out a hard copy of their annual report to shareholders except where shareholders have made a specific election to receive a hard copy and notified the Company to that effect. If you haven’t already made an election, you can obtain a hard copy by contacting the Company. Alternatively, it is available on the Company’s website at www.perseusmining.com for you to download or read online.

3. RESOLUTION 1 – Adoption of Remuneration Report

The Annual Report for the financial year ended 30 June 2009 contains a Remuneration Report, which forms part of the Directors' Report and sets out the remuneration policy for the Company and its controlled entities, and reports the remuneration arrangements in place for executive directors, senior management and nonexecutive directors.

The Corporations Act 2001 requires listed companies to put a non-binding resolution to shareholders to adopt the Remuneration Report. In line with the legislation, this vote will be advisory only, and does not bind the Directors or the Company. However, the Board will take the outcome of the vote into consideration when considering the Company's remuneration policy.

A reasonable opportunity will be provided for discussion of the Remuneration Report at the meeting.

4. RESOLUTIONS 2, 3 & 4 – Re-election of Directors, Sean Harvey, Michael Bohm and Rhett Brans

The Company’s Constitution requires directors who are appointed during the year to retire at the first AGM held after their appointment. Retiring directors are eligible for re-election. As Mr Sean Harvey and Mr Michael Bohm were appointed during the year, they must resign but are eligible for re-election.

In accordance with the requirements of the Company’s Constitution, ASX Listing Rules and the Corporations Act, one-third of the directors of the Company and those who were last re-elected more than three years ago retire from office at this annual general meeting of the Company and, being eligible, offer themselves for reelection. Mr Brans’s re-election is under this rule. Details of Messrs Brans’s and Harvey’s qualifications and experience are available in the Annual Report.

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Mr Bohm was appointed on 15 October 2009 and details of his qualifications and experience are available in the Company’s announcement to ASX dated 16 October 2009.

5. RESOLUTION 5 – Ratification of prior option issue

On 20 March 2009 the Company issued 2,000,000 options to BGF Equities Pty Ltd as part consideration for advisory services. Under ASX Listing Rule 7.1, a company may only issue a limited number of equity securities in any 12 month period without shareholder approval. By issuing 2 million options the Company used part of its 15% placement capacity.

The Company wishes to restore its 15% placement capacity and accordingly under ASX Listing Rule 7.4, seeks subsequent shareholder approval for that prior option issue.

5.1 Specific Information required by ASX Listing Rule 7.5

For the purposes of ASX Listing Rule 7.5 information is provided as follows:

• i. 2,000,000 options were issued on 20 March 2009.

• ii. The options were issued at a nil issue price, no funds were raised from their issue and they comprised part consideration for advisory services.

• iii. 1 million options are exercisable at 80 cents prior to 31 December 2009, whilst the remaining 1 million options are exercisable at $1 between 1 January 2010 and 31 December 2010. The options are non transferable except to related parties of the holder. Refer to Appendix 3 for detailed terms and conditions.

• iv. The options were issued to BGF Equities Pty Ltd.

A voting exclusion statement is included in the Notice.

6. RESOLUTION 6 – Ratification of prior securities issue

On 13 August 2009 the Company issued 2,000,000 shares and 2,000,000 options to Strategic Systems Pty Ltd as part consideration for acquisition of shares in Central Ashanti Gold Ltd (“CAGL”). CAGL, a wholly owned subsidiary of the Company, is the owner of the Ayanfuri Gold Project in Ghana. Under the terms of the share purchase agreement entered into in 2006, the Company was required to issue further securities as purchase consideration for CAGL shares if gold reserves of greater than 500,000 ounces were proved on the Ayanfuri Gold Project. The obligation to issue this further consideration was triggered as a consequence of the Company announcing a gold reserve of 2.1 million ounces on the Ayanfuri Gold Project in late July 2009.

Under ASX Listing Rule 7.1, a company may only issue a limited number of equity securities in any 12 month period without shareholder approval. By issuing these securities the Company used part of its 15% placement capacity. The Company wishes to restore its 15% placement capacity and accordingly under ASX Listing Rule 7.4, seeks subsequent shareholder approval for that securities issue.

6.1 Specific Information required by ASX Listing Rule 7.5

For the purposes of ASX Listing Rule 7.5 information is provided as follows:

• i. 2,000,000 shares and 2,000,000 options were issued on 13 August 2009.

• ii. The securities were not issued for cash consideration and no funds were raised from their issue. As explained above they comprise part consideration for acquisition of shares in Central Ashanti Gold

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Ltd.

• iii. The shares are in the same class as quoted fully paid ordinary shares. Options are exercisable at 60 cents each on or before 13 August 2011. Refer to Appendix 4 for detailed terms and conditions.

• iv. The securities were issued to Strategic Systems Pty Ltd.

A voting exclusion statement is included in the Notice.

7. RESOLUTION 7 – Ratification of prior option issue

On 15 October 2009 the Company issued 400,000 options to Mr Michael Bohm as a condition of his appointment as a director on the same day and as part of his remuneration package as a non-executive director of the Company.

Resolution 7 seeks ratification by shareholders pursuant to ASX Listing Rule 7.4 of this prior option issue in order to restore the Company’s 15% placement capacity.

7.1 Specific Information required by ASX Listing Rule 7.5

For the purposes of ASX Listing Rule 7.5 information is provided as follows:

• (i) 400,000 options were granted.

• (ii) The options were not issued for cash consideration and no funds were raised from their issue. As explained above they comprise part of the remuneration package for Mr Bohm’s services as a director.

• (iii) The options are exercisable at $1.80 each on or before 31 March 2012. The detailed terms and conditions of the options are set out in Appendix 1 to this Explanatory Memorandum

• (iv) The options were granted to Mr Michael Bohm on 15 October 2009.

A voting exclusion statement is included in the Notice.

8. RESOLUTION 8 – Ratification of prior share issue

On 26 October 2009, the Company announced it had resolved to raise funds through a private placement of up to 39 million securities. The placement offer is on a best endeavours basis, to be managed by Cormark Securities Inc and BGF Equities Pty Ltd respectively. Completion of the placement offer is anticipated within the next few days and prior to the date of the Annual General Meeting.

The issue of up to 39 million securities will fall within the Company’s 15% placement capacity under ASX Listing Rule 7.1. Consequently, Resolution 8 seeks shareholder ratification for the allotment and issue of up to 39 million securities, which will have the effect of refreshing the Company’s 15% limit for new issues of securities under the ASX Listing Rules.

8.1 Specific Information required by ASX Listing Rule 7.5 with respect to Resolution 8

For the purposes of ASX Listing Rule 7.5 information is provided as follows:

• (i). Up to 39,000,000 securities comprising 15,600,000 ordinary shares and 23,400,000 subscription receipts will be issued following the date of this Notice of Annual General Meeting and prior to the meeting date of 27 November 2009. Each subscription receipt will be converted to one fully paid ordinary share upon completion of a listing of Perseus’s securities on the Toronto Stock Exchange (“TSX”).

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• (ii). The shares and the subscription receipts will each be issued at $1.50 to raise a total of $58.5 million before costs of the issue.

• (iii). The shares issued are fully paid ordinary shares in the Company. As explained above, subject to a listing of Perseus on TSX, the 23,400,000 subscription receipts will be converted to fully paid ordinary shares in the Company upon completion of TSX listing. The funds from the issue of the subscription receipts ($35.1 million) will be held in escrow until completion of TSX listing, which must take place within 90 days after the issue date of the subscription receipts.

• (iv). The shares will be issued to professional and sophisticated investor clients of a broker / investment dealers syndicate which will be lead managed by BGF Equities Pty Ltd and Cormark Securities Inc and including Clarus Securities Inc, Dundee Securities Corporation, BMO Capital Markets, CIBC World Markets Inc, GMP Securities LP and Rodman and Renshaw LLP . Related parties of the Company will not participate in the placement.

• (v). As an indication, the new funds would be spent on Ayanfuri mine development and further exploration, Tengrela exploration, with the balance on costs of the share issues, corporate overheads and administration costs.

A voting exclusion statement is included in the Notice.

9. RESOLUTION 9 – Issue of Options to Director

On 28 September 2009 the Directors announced their intention to seek shareholder approval for the issue of options to Mr T Sean Harvey. Mr Harvey was appointed a non-executive director of the Company on 2 September 2009. Detailed terms and conditions of the options are provided in Appendix 2.

The purpose of the issue of options is to provide Mr Harvey with an incentive for the provision of future services. The issue of options as part of the remuneration packages of directors is an established practice of smaller public listed companies and, in the case of the Company, has the benefit of conserving cash whilst properly rewarding the director. Whilst Mr Harvey does not make a recommendation as he has a personal interest in the proposed issue, he believes that the quantum of options together with the cash fees that he is entitled to is reasonable in the context of the size and complexity of the Company’s activities and also by comparison to other similar-sized mineral explorers.

The ASX Listing Rules require shareholder approval to be obtained for the issue of options to directors. Accordingly, approval for the issue of options to Mr Harvey is being sought in accordance with the provisions of Rules 7.1 and 10.11 of the ASX Listing Rules (“ Listing Rules ”). If approval for the issue of the options is obtained under Listing Rule 10.11, approval is not required under Listing Rule 7.1.

Subject to shareholder approval, the options referred to in resolution 9 will be issued free of charge and within one month after the date of this meeting.

(A) Requirement for shareholder approval

The proposed resolution 9, if passed, will issue securities to and confer financial benefits upon Mr Harvey who is a director of the Company. The Company seeks to obtain shareholder approval in accordance with the requirements of ASX Listing Rule 10.11. Accordingly, information required under the Listing Rules, as well as information that will properly enable shareholders to consider resolution 9, is presented below.

(B) Potential Benefits

If options are issued pursuant to the proposed resolution 9, the Company considers the following benefits arise:

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• (i) Mr Harvey will have a vested interest in the affairs of the Company, as the holder of options and as a shareholder upon exercise of the options, particularly as the Options are not transferable (except in limited circumstances).

• (ii) The issue of options to Mr Harvey is a non-cash form of remuneration, thus conserving the Company’s cash reserves. The issue enables the Company to provide Mr Harvey with reward for services provided and an incentive for future services he will provide to the Company.

• (iii) The exercise of the options will provide working capital for the Company at no significant cost. If all of the options proposed to be issued to Mr Harvey are ultimately exercised, an amount of $780,000 would be raised.

(C) Potential Costs

The options are to be granted for nil consideration and thus no funds will be raised by the Company in granting those options.

The potential cost to the Company of the issue of an aggregate of 600,000 options to Mr Harvey is that there will be a dilution of the issued share capital of the Company if the options are eventually exercised.

Based on a fully diluted issued capital of 314,302,088 shares, the exercise of the proposed options (600,000) would have a dilution effect of approximately 0.19% (with a corresponding increase in cash reserves of $780,000). As the Company presently has 11,255,000 options on issue with exercise prices ranging between 50 cents and $1.50, it is appropriate to measure the dilution caused by the proposed issue of options to Mr Harvey by reference to fully diluted shares rather than just ordinary shares presently on issue.

The price of the Company’s shares quoted on the ASX over the past 12 months has ranged from a low of 20 cents on 24 November 2008 to a high of $1.75 on 20 October 2009, the date on which this section of the Explanatory Memorandum was prepared.

Accounting standard, AASB 2 “Share Based Payments” requires that these payments shall be measured at the more readily determinable fair value of the equity instrument. Under the accounting standard this amount will be expensed in the Income Statement – i.e. the value attributed to Mr Harvey’s options (See Section D below) will be expensed in the profit and loss account of the Company. Where the grant date and the vesting date are different the total expenditure calculated will be allocated between the two dates taking into account the terms and conditions attached to the instruments and the counterparties as well as management’s assumptions about probabilities of payments and compliance with and attainment of the set out terms and conditions.

(D) Valuation of Options

The Company does not have any ASX-quoted options with identical or similar terms and conditions as the proposed options and as such there is no comparable market value. Each option grants the holder a right to be allotted one share upon exercise of the option and payment of the exercise price of the option. Accordingly, the proposed options arguably have a value at the date of their grant if the market value of the Company's shares at that date exceeds the exercise price. The options may acquire future value dependent upon the extent to which the market value of shares exceeds the exercise price of the options during the term of the options.

As a general proposition, options to subscribe for ordinary fully paid shares in a company have value. Various factors impact upon the value of options including things such as:

• (i) the period outstanding before the expiry date of the options;

• (ii) the exercise price of the options relative to the underlying price or value of the securities into which they may be converted;

• (iii) the proportion of the issued capital (as expanded consequent upon exercise) represented by the shares issued upon exercise (ie whether or not the shares that might be acquired upon exercise of the options represent a controlling or other significant interest);

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• (iv) the value of the shares into which the options may be converted; and

• (v) whether or not the options are listed (ie readily capable of being liquidated).

There are various formulae which can be applied to determining the theoretical value of options (including the formula known as the Black-Scholes Model option valuation formula).

The Company has estimated the value of the options using the Black-Scholes Model, which is the most widely used and recognised model for pricing options. The value of an option calculated by the Black-Scholes Model is a function of the relationship between a number of variables, being the share price, the exercise price, the time to expiry, the risk-free interest rate and the volatility of the Company’s underlying share price.

Inherent in the application of the Black-Scholes Model are a number of inputs, some of which must be assumed. The data relied upon in applying the Black-Scholes Model in the present case were as follows:

• (i) an exercise price of the Option of $1.30;

• (ii) length of period prior to conversion being 2 years and 4 months (December 2009 to March 2012). For the purposes of the analysis it was assumed that the options would not be exercised any earlier than the expiration date, being 31 March 2012;

• (iii) the Company has not forecast any future dividend payments. For the purposes of the analysis, it was assumed that the Company’s share price is “ex-dividend”;

• (iv) the risk-free rate used for the purposes of the analysis is the Reserve Bank of Australia cash rate as at 12 October 2009, being 3.25%;

• (v) a volatility measure of 129%; and

• (vi) the valuation of the Company’s share price being $1.73, being the value of the Company’s share price as at 20 October 2009.

Using the Black-Scholes Model and the assumed data outlined above, the directors have valued the options as at 20 October 2009 at $1.26 each.

Using this analysis ($1.26), the total value of the proposed options to be granted to Mr Harvey is as follows:

Number of options	Total Value of Options
600,000	$756,000

(E) Identifying the Related Party

The related party to whom resolution 9 would permit financial benefits to be given is Mr T S Harvey.

(F) Financial Benefit

The nature of the financial benefit is the grant of 600,000 options to Mr Harvey for no consideration.

(G) Related Party’s Existing Interest

Excluding the options the subject of resolution 9, the current interests of Mr Harvey (and entities associated with him) in the Company’s securities are as follows:

Shares	Options
100,000	Nil

(H) Director’s Emoluments

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Other than the options, Mr Harvey’s current remuneration is as follows:

Position	Annual Remuneration
Non-Executive Director	$50,000

(I) Directors' Recommendation

Mr Harvey expresses no opinion and makes no recommendation in respect of resolution 9 given his personal interest in the Resolution. Each of the other directors (Messrs Gillard, Calderwood, Carson, Fearis, Brans and Bohm) recommend that shareholders approve resolution 9 for the reasons set out in this Explanatory Memorandum, including:

• (i) Mr Harvey will have a vested interest in the affairs of the Company, as the holder of options and as a shareholder upon exercise of the options, particularly as the options are not transferable (except in limited circumstances);

• (ii) With the continuing shortage of skilled, experienced personnel in the resources sector, the Company must compete with many other industry participants in order to attract and retain personnel, including directors. Remunerations levels across the board have gone up significantly over the last 3 years and, again, the Company must keep pace in order to remain competitive. There are a number of key challenges that the Company faces over the foreseeable future as it seeks to make the transition from explorer to producer. It is important in these circumstances to ensure continuity at Board level, as these challenges are tackled;

• (iii) The issue of options to Mr Harvey is a non-cash form of remuneration, thus conserving the Company’s cash reserves. The issue will enable the Company to provide an incentive to Mr Harvey with respect to future services he will provide to the Company,

and on the basis that, in their opinion, the proposed issue of options is fair and reasonable having regard to the terms of the options.

(J) Other Information

No fringe benefits tax or stamp duty will be payable in respect of the grant of the options. No GST will be payable by the Company in respect of the grant of the options (or if it is then it will be recoverable as an input credit).

Other than the information above and otherwise set out in this Explanatory Memorandum and the accompanying cover letter, the directors believe that there is no other information known to the Company or its directors that will be reasonably required by shareholders to make a decision in relation to benefits contemplated by the proposed resolution 9.

A voting exclusion statement is included in the Notice.

10. RESOLUTION 10 – Non-Executive Directors’ Fees

This resolution seeks shareholder approval for an increase in fees for the non-executive directors. The current ceiling for non-executive directors’ fees is $200,000 per annum and shareholder approval is sought to increase this amount by $200,000 for a new aggregate limit of $400,000.

Since September 2009, the Company has appointed two new non-executive directors and it now has four nonexecutive directors. Fees paid to directors out of the maximum amount approved by shareholders are reviewed from time to time. The present limit of $200,000 therefore requires revision to ensure payment of fees to the

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newly appointed directors at the same rate as other non-executive directors.

Shareholder approval is sought for an upper limit of $400,000, which will provide the Company flexibility in appointing new directors in the future and provide flexibility to allow for payment of appropriate fees over time.

It is not the Board’s present intention to utilise the proposed $400,000 pool of fees in full and the amount is simply the maximum that the Company will be allowed to pay its non-executive directors in aggregate.

The Company’s executive directors, Mr Mark Calderwood, Mr Colin Carson and Mr Rhett Brans (who will not be eligible for directors’ fees from this proposed pool) recommend that shareholders approve the resolution for the increase in non-executive directors’ fees.

Cautionary Notes

The directors recognise and acknowledge the importance of shareholders making their decision on the basis of the best possible information. However, once this Explanatory Memorandum is prepared and despatched to shareholders, the Company has no legal obligation to continuously update the content of this material, nor is it practical or logistically possible to do that and inform each shareholder individually.

By its nature, the exploration industry is subject to numerous risks and the Company’s share price is affected by a range of factors. From the time of preparing this material to the date of the Annual General Meeting the Company’s share price may go up or down. The Company will continue to comply with its continuous disclosure obligations and make appropriate announcements to the ASX.

Shareholders are strongly encouraged to keep track of any announcements that the Company may make and of the Company’s share price up to the date of the Annual General Meeting as that information may have an effect on the calculations and the data that are provided in this Explanatory Memorandum in relation to resolution 9. If you do not understand the effect of such information, you should consult your professional advisor.

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APPENDIX 1 TERMS AND CONDITIONS OF OPTIONS (RESOLUTION 7)

1. Each option entitles the holder ("Optionholder") to subscribe for and be allotted one ordinary share in the capital of Perseus Mining Limited (the “Company”) at a price of $1.80 per share at any time until 31 March 2012 (“the Expiry Date”).

2. The options are exercisable at any time during the exercise period noted above by notice in writing to the Directors accompanied by payment of the exercise price.

3. Shares will be allotted and issued pursuant to the exercise of options not more than 10 business days after receipt of a properly executed notice of exercise and payment of the requisite application moneys.

4. The options are not transferable, except to a spouse of the Optionholder or a company wholly owned by the Optionholder and his or her spouse.

5. Shares issued upon exercise of the options will rank pari passu in all respects with the Company’s fully paid ordinary shares. The Company will apply for Official Quotation by ASX of all Shares issued upon the exercise of options within 3 business days after the date of allotment of those shares.

6. There are no participating rights or entitlements inherent in the options and holders will not be entitled to participate in new issues of capital offered or made to the shareholders during the currency of the options. However, the Company will send a notice to each Optionholder at least 9 business days before the record date for any proposed issue of capital on an entitlement basis. This will give Optionholders the opportunity to exercise their options (subject to the exercise period referred to above) prior to the date for determining entitlements to participate in any such issue.

7. There are no rights to a change in the exercise price, or in the number of shares over which the options can be exercised, in the event of a bonus issue by the Company prior to the exercise of any options.

8. In the event of any reorganisation of the issued capital of the Company on or prior to the Expiry Date, the rights of an Optionholder will be changed to the extent necessary to comply with the applicable ASX Listing Rules at the time of the reorganisation.

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APPENDIX 2 TERMS AND CONDITIONS OF OPTIONS (RESOLUTION 9)

The material terms and conditions of the options are as follows:

1. Each option entitles the holder ("Optionholder") to subscribe for and be allotted one ordinary share in the capital of Perseus Mining Limited (the “Company”) at a price of $1.30 per share from 1 July 2010 until 31 March 2012 (the "Expiry Date”).

2. The options are exercisable at any time during the exercise period noted above by notice in writing to the Directors accompanied by payment of the exercise price.

3. Shares will be allotted and issued pursuant to the exercise of options not more than 10 business days after receipt of a properly executed notice of exercise and payment of the requisite application moneys.

4. The options are not transferable, except to a spouse of the Optionholder or a company wholly owned by the Optionholder and his spouse.

5. Shares issued upon exercise of the options will rank pari passu in all respects with the Company’s fully paid ordinary shares. The Company will apply for Official Quotation by ASX of all Shares issued upon the exercise of options within 3 business days after the date of allotment of those shares.

6. There are no participating rights or entitlements inherent in the options and holders will not be entitled to participate in new issues of capital offered or made to the shareholders during the currency of the options. However, the Company will send a notice to the Optionholder at least 9 business days before the record date for any proposed issue of capital on an entitlement basis. This will give the Optionholder the opportunity to exercise his options (subject to the exercise period referred to above) prior to the date for determining entitlements to participate in any such issue.

7. There are no rights to a change in the exercise price, or in the number of shares over which the options can be exercised, in the event of a bonus issue by the Company prior to the exercise of any options.

8. In the event of any reorganisation of the issued capital of the Company on or prior to the Expiry Date, the rights of the Optionholder will be changed to the extent necessary to comply with the applicable ASX Listing Rules at the time of the reorganisation.

9. The Optionholder is entitled to exercise the options prior to the commencement of the exercise period referred to in (1) above if a takeover bid under Chapter 6 of the Corporations Act is made for the Company and either:

10. (a) the offeror has at the time of making the takeover bid a voting power of more than 50% in the Company; or

11. (b) if sub-clause (a) does not apply, the bid is or becomes free of defeating conditions.

12. The Optionholder (or his successor in title) is entitled to exercise the Options prior to the commencement of the exercise period referred to in (1) above in the event of death or total and permanent disablement of the Optionholder.

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APPENDIX 3 TERMS AND CONDITIONS OF OPTIONS (RESOLUTION 5)

1. Each Option entitles the holder to subscribe for and be allotted one ordinary share in the capital of Perseus Mining Limited (“the Company”). The exercise price is 80 cents per Option in the case of 1,000,000 Options (“Tranche A”) and $1.00 per Option in the case of 1,000,000 Options (“Tranche B”).

2. Tranche A Options are exercisable at any time prior to 31 December 2009 and Tranche B Options are exercisable at any time after 1 January 2010 and prior to 31 December 2010 by notice in writing to the Company accompanied by payment of the exercise price (31 December 2009 and 31 December 2010 are referred to as the “Expiry Date” for Tranche A and Tranche B Options respectively).

3. The Options are not transferable except to an offeror under a Takeover Offer or under a scheme of arrangement proposed by the Company, or except with the consent of the Directors of the Company in circumstances where the proposed transfer is to a “Related Entity” (as defined by the Corporations Act) of BGF Equities Pty Ltd.

4. Shares will be allotted and issued pursuant to the exercise of Options not more than 10 business days after receipt of a properly executed notice of exercise and payment of the requisite application moneys.

5. Shares issued upon exercise of the Options will rank pari passu in all respects with the Company’s fully paid ordinary shares. The Company will apply for Official Quotation by ASX of all Shares issued upon the exercise of Options within 3 business days after the date of allotment of those shares.

6. There are no participating rights or entitlements inherent in the Options and the holder will not be entitled to participate in new issues of capital offered or made to the shareholders during the currency of the Options. However, the Company will send a notice to the Optionholder at least 9 business days before the record date for any proposed issue of capital on a prorata entitlement basis. This will give the Optionholder the opportunity to exercise its Options (subject to the exercise period referred to above) prior to the date for determining entitlements to participate in any such issue.

7. There are no rights to a change in the exercise price, or in the number of Shares over which the Options can be exercised, in the event of a bonus issue by the Company prior to the exercise of any Options.

8. In the event of any reorganisation of the issued capital of the Company on or prior to the Expiry Date, the rights of the Optionholder will be changed to the extent necessary to comply with the applicable ASX Listing Rules at the time of the reorganisation.

9. The Company will, at least 20 business days before the Expiry Date, send notices to the Optionholder stating the name of the Optionholder, the number of Options held, the number of Shares to be issued on exercise of the Options, the exercise price, the due date for payment of the exercise price, and the consequences of non-payment.

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APPENDIX 4 TERMS AND CONDITIONS OF OPTIONS (RESOLUTION 6)

1. Each Option entitles the holder to subscribe for and be allotted one ordinary share in the capital of Perseus Mining Limited (“the Company”). The exercise price is 60 cents per Option.

2. The Options are exercisable at any time prior to 13 August 2011 (“Expiry Date”) by notice in writing to the Company accompanied by payment of the exercise price.

3. The Options are not transferable except to an offeror under a Takeover Offer or under a scheme of arrangement proposed by the Company, or except with the consent of the Directors of the Company in circumstances where the proposed transfer is to an entity wholly owned and controlled by the optionholder.

4. Shares will be allotted and issued pursuant to the exercise of Options not more than 10 business days after receipt of a properly executed notice of exercise and payment of the requisite application moneys.

5. Shares issued upon exercise of the Options will rank pari passu in all respects with the Company’s fully paid ordinary shares. The Company will apply for Official Quotation by ASX of all Shares issued upon the exercise of Options within 3 business days after the date of allotment of those shares.

6. There are no participating rights or entitlements inherent in the Options and the holder will not be entitled to participate in new issues of capital offered or made to the shareholders during the currency of the Options. However, the Company will send a notice to the Optionholder at least 9 business days before the record date for any proposed issue of capital. This will give the Optionholder the opportunity to exercise its Options (subject to the exercise period referred to above) prior to the date for determining entitlements to participate in any such issue.

7. There are no rights to a change in the exercise price, or in the number of Shares over which the Options can be exercised, in the event of a bonus issue by the Company prior to the exercise of any Options.

8. In the event of any reorganisation of the issued capital of the Company on or prior to the Expiry Date, the rights of the Optionholder will be changed to the extent necessary to comply with the applicable ASX Listing Rules at the time of the reorganisation.

9. The Company will, at least 20 business days before the Expiry Date, send notices to the Optionholder stating the name of the Optionholder, the number of Options held, the number of Shares to be issued on exercise of the Options, the exercise price, the due date for payment of the exercise price, and the consequences of non-payment.

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Perseus Mining Limited (ACN 106 808 986) PROXY FORM

Shareholder

Name and address of shareholder of Perseus Mining Ltd. Name

Address

Appointment of Proxy

I/We being a member/s of Perseus Mining Ltd and entitled to attend and vote hereby appoint

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The Chairman of the Meeting OR (mark with an “X”)

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If you are not appointing the Chairman of the Meeting as your proxy please write here the full name of the individual or body corporate (excluding the registered Securityholder) you are appointing as your proxy.

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, as the proxy sees fit) at the Annual General Meeting of Perseus Mining Ltd to be held on 27 November 2009 and at any adjournment of that meeting.

If you do not wish to direct your proxy how to vote, please place a mark in the box �� �

By marking this box, you acknowledge that the Chairman may exercise your proxy even if he has an interest in the outcome of the resolutions and votes cast by him other than as proxy holder will be disregarded because of that interest. The Chairman of the Meeting intends to vote any such undirected proxies in favour of all the resolutions.

If you do not mark the above box and you have not directed your proxy how to vote in the boxes below, the Chairman of the Meeting will not cast your votes on the resolutions and your votes will not be counted in computing the required majority if a poll is called.

Voting directions to your proxy – please mark ⌧ to indicate your directions

For Against Abstain*

Resolution 1 – Adoption of Remuneration Report Resolution 2 – Re-Election of T S Harvey Resolution 3 – Re-Election of M Bohm Resolution 4 – Re-Election of R B Brans Resolution 5 – Ratification of 2m prior option issue Resolution 6 – Ratification of prior securities issue as purchase consideration Resolution 7 – Ratification of option issue to director Resolution 8 – Ratification of prior securities issue Resolution 9 – Approval for the Issue of Options to a Director, Mr T S Harvey Resolution 10 – Approval for increase in aggregate Non-Executive Directors Fees

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

Please sign here - This section must be signed in accordance with the instructions overleaf to enable your directions to be implemented.

Individual or Securityholder 1 Securityholder 2 Securityholder 3 Sole Director and Director Director/Company Secretary Sole Company Secretary

Dated: //2009

How to complete the Proxy Form

1 Appointment of a Proxy

If you wish to appoint the Chairman of the Meeting as your proxy, mark the box. If the individual or body corporate you wish to appoint as your proxy is someone other than the Chairman of the Meeting please write the full name of that individual or body corporate in the space provided. If you leave this section blank, or your named proxy does not attend the meeting, the Chairman of the Meeting will be your proxy. A proxy need not be a securityholder of the company. Do not write the name of the issuer company or the registered securityholder in the space.

2 Votes on Items of Business

You may direct your proxy how to vote by placing a mark in one of the three boxes opposite each item of business. All your securities will be voted in accordance with such a direction unless you indicate only a portion of voting rights are to be voted on any item by inserting the percentage or number of securities you wish to vote in the appropriate box or boxes. If you do not mark any of the boxes on a given item, your proxy may vote as he or she chooses. If you mark more than one box on an item your vote on that item will be invalid.

3 Appointment of a Second Proxy

You are entitled to appoint up to two proxies to attend the meeting and vote on a poll. If you wish to appoint a second proxy, an additional Proxy Form may be obtained by telephoning the company's share registry or you may copy this form.

To appoint a second proxy you must:

• (a) on each of the first Proxy Form and the second Proxy Form state the percentage of your voting rights or number of securities applicable to that form. If the appointments do not specify the percentage or number of votes that each proxy may exercise, each proxy may exercise half your votes. Fractions of votes will be disregarded.

• (b) return both forms together.

4 Signing Instructions

You must sign this form as follows in the spaces provided:

Individual: where the holding is in one name, the holder must sign.

Joint Holding: where the holding is in more than one name, all of the securityholders should sign.

Power of Attorney: to sign under Power of Attorney, you must have already lodged this document with the registry. If you have not previously lodged this document for notation, please attach a certified photocopy of the Power of Attorney to this form when you return it.

Companies: where the company has a Sole Director who is also the Sole Company Secretary, this form must be signed by that person. If the company (pursuant to section 204A of the Corporations Act 2001) does not have a Company Secretary, a Sole Director can also sign alone. Otherwise this form must be signed by a Director jointly with either another Director or a Company Secretary. Please indicate the office held by signing in the appropriate place.

If a representative of a corporate Securityholder or proxy is to attend the meeting the appropriate "Certificate of Appointment of Corporate Representative" should be produced prior to admission. A form of the certificate may be obtained from the company's share registry.

Lodgement of a Proxy

This Proxy Form (and any Power of Attorney under which it is signed) must be received at an address given below no later than 3.00pm on 25 November 2009. Any Proxy Form received after that time will not be valid for the scheduled meeting.

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Documents may be lodged:

IN PERSON: Registered Office – 30 Ledgar Road, Balcatta, Western Australia 6021

BY MAIL: Registered Office - 30 Ledgar Road, Balcatta, Western Australia 6021 / P O Box 717, Balcatta, Western Australia 6914

BY FAX (61 8) 9240 2406