China Nonferr Regulatory News (CNG)

9 Jun 2011 07:00

KRYSO RESOURCES PLC 'Kryso' or 'the Company' Final Results for the year ended 31 December 2010 And Notice of Annual General Meeting Kryso Resources PLC (AIM: KYS), the mineral exploration and development company withgold and nickel-copper projects in Tajikistan, is pleased to announce its resultsfor the year ended 31 December 2010. The results below are extracted from the Company'saudited Annual Report and Financial Statements. Copies of the Annual Report togetherwith a Notice of Annual General Meeting have been posted to shareholders and areavailable on the Company's website at www.kryso.com and from the Company's registeredoffices at Unit 3H, Cooper House, 2 Michael Road, London SW6 2AD. Financial Highlights Development work costs up 50% to US$2,640,000 (2009: US$1,759,000). These costshave been fully capitalised. Administration costs down 21% to US$935,000 (2009: US$1,184,000). Loss down 11% to US$1,117,000 (2009: US$1,259,000). Allotment of 73,333,333 new ordinary shares at a price of 15p per share to ChinaNonferrous Metals Int'l Mining Co. Ltd ("CNMIM"), raising approximately £11,000,000resulting in CNMIM holding 29.9% of the Company. In addition, CNMIM were also issued73,333,333 warrants, each entitling CNMIM to subscribe for one ordinary share inthe Company at a price of 21p per share. Cash of $16.59 million at 31 December 2010 Operational Highlights 2010 drilling programme results confirm that mineralization continues at depthat Pakrut. Eastern Pakrut drilling confirms consistency of thickness and grade withprevious drilling results at the prospect, demonstrating significant potential toexpand the resources in the Pakrut general area. Bankable Feasibility Study ("BFS") completed by the Beijing General ResearchInstitute of Mining and Metallurgy ("BGRIMM"). Following a tender process, BGRIMM appointed to complete engineering design ofthe mine and plant for the development of the Pakrut Gold Deposit. Highlights since year end April 2011 JORC compliant resources at Pakrut increased 18% to 3,578,000 oz Auat a 0.0 g/t Au cut-off grade (June 2010: 3,024,000 oz Au), with total Measured Resourcesup 54% to 1,488,000 oz Au at a 0.5 g/t cut-off (June 2010: 969,000 oz Au). Export Import Bank of China ("China Eximbank") issued a LOI on 7 March 2011 confirmingits interest in providing 70% of the financing required by our Company for the Pakrutproject production development. Tao Luo, Non-Executive Chairman, commented; "We have made significant technical progressduring 2010 in advancing our 100% owned Pakrut gold project, and the detailed engineeringdesign of the mine and plant is approaching final optimisation. CNMIM's investmentmade during the year, and its agreement to secure a written offer of debt funding,has moved us into an excellent financial position from which to accelerate our progressiontoward commercial production. We are therefore confident that we remain on targetto reach production in the second half of 2012." For further information please visit the Company's website (www.kryso.com) or contact: Kryso Resources PLC Dr Trevor Davenport/Craig Brown Tel: +44 (0)20 7371 0600 Anthony Schindler, Investor Relations Mobile: 07710 178 928 Evolution Securities Jeremy Ellis/Andrew Dacey Tel:+44 (0)20 7071 4300 Optiva Securities Limited Christian Dennis/Jeremy King Tel: +44 (0)20 3137 1902 Walbrook PR Bob Huxford Tel: +44 (0)20 7933 8780 Mobile: 07900 346 978 Paul Cornelius Tel: +44 (0)20 7933 8794 Mobile: 07827 879 460 About the Pakrut Gold Project The Pakrut gold project, of which Kryso has 100% ownership, is situated in Tajikistanapproximately 112 km northeast of the capital city Dushanbe. Pakrut has an estimated total Mineral Resource of 3,578,000 oz Au (assuming a cut-offgrade of 0.0g/t Au) and is located within the Tien Shan gold belt, which extendsfrom Uzbekistan into Tajikistan, Kyrgyzstan and western China, and which hosts anumber of multi-million ounce gold deposits. Drilling at Pakrut has previously returned numerous encouraging intersections, includingthe following results released in March 2011: Ore Zone 1: 21m (\* TW-15.3m) at 7.28 g/t, 24m (TW-17.98m) at 5.39 g/t and 16.5m(TW-12.36m) at 5.57 g/t Au Ore Zone 2: 30m (TW-22.62m) at 4.37 g/t and 42.9m (TW-32.89m)at 2.57 g/t Au Ore Zone 3: 16.5m (TW-13.28m) at 4.48 g/t and 6m (TW-4.92m) at 6.58 g/t Au Ore Zone 6: 4.5m (TW-3.44m) at 18.2 g/t \* TW - True width / true thickness of ore zone About Tajikistan Tajikistan is a secular republic located in Central Asia. The country is a memberof the Commonwealth of Independent States (CIS) and the Shanghai Cooperation Organisation.Tajikistan hosts numerous operating precious metal mines as well as the largest aluminiumsmelter in Central Asia. Kryso's management team has extensive experience in themining industry in Tajikistan. CHAIRMAN'S STATEMENT In my first annual statement to Shareholders as Non-Executive Chairman of Kryso ResourcesPLC, I am extremely pleased to report on significant progress in our operations andCompany structure. I believe that 2010 will in the future prove to be a very significantyear in the development of our Company. Since the publication of our 2010 interim results statement, Kryso has made considerabletechnical progress at the Pakrut Gold Deposit including, amongst other developments,the release of the BFS, which has included the results of our 2010 diamond drillingprogramme and an updated JORC Resource estimate. In addition, the investment and cooperation by our new major shareholder, CNMIM,has not only progressed our financing objectives for the Pakrut project but has alsohelped add key technical, management and financing expertise to our management team. The Pakrut Gold Project Drilling Results and JORC Resources Updates In March 2011, we announced some highly positive results of our Pakrut drilling programmecompleted during 2010. The results improved the definition of the Pakrut resourcesand confirmed that mineralization is continuing at depth. In addition, our objectiveto further investigate Eastern Pakrut confirmed that the mineralization also continuesat depth. In total 6,967 metres were drilled during 2010 in a total of 16 drill holes.Significant mineralized intercepts were obtained from 15 of the drill holes. These results were especially encouraging in terms of the Indicated Resource of thelower eastward extension of Ore Zone 1 and by the consistency of thickness and gradewith previous drilling results from the whole Pakrut ore zone. They demonstrate thesignificant potential to expand the resource at Pakrut. We are also delighted to announce significant increases in our resource estimates.Following the completion by Snowden Mining Industry Consultants (Pty) Ltd ("Snowden")of an updated JORC Code-compliant resource estimate, we announced in April 2011 thattotal JORC resources increased to 3,578,000 oz Au at a 0.0 g/t cut-off - up 18% fromthe 3,024,000 oz Au announced in June 2010. Total Measured Resources increased by54% to 1,488,000 oz Au at a 0.5 g/t cut-off (June 2010: 969,000 oz Au). Significantly,the Eastern Pakrut Inferred Resource increased by 354% to 369,000 oz Au at a 0.5g/t cut-off. Snowden's updated estimates include the results of the 2010 drillingprogramme at Pakrut and Eastern Pakrut referred to above. Bankable Feasibility Study In October 2010, the results of the BFS, completed by the Beijing General ResearchInstitute of Mining & Metallurgy ("BGRIMM"), detailed some very positive findings.These are summarised below: A mine life of 14 years with average gold production of 82,000 oz over the firstfour years Life of mine operating costs of US$377/oz Au At a US$897/oz gold price the project would have: NPV (10%) of US$121 million IRR of 40% Payback period of 3.0 years At a US$1 ,250/oz gold price the project would have: NPV (10%) of US$227 million IRR of 58% Payback period of 2.7 years Total capital required for development of approximately US$108 million. BGRIMM has further recommended that optimisation of the project be carried out priorto construction to further improve the economic viability of the mine. The abovefigures are all pre-tax but allow for anticipated debt financing costs. Following the BGRIMM recommendation and a tender process completed in December 2010,Kryso announced in January 2011 that B GRIMM had been appointed to complete the detailedengineering design of the mine and plant for the development of the Pakrut Gold Deposit.These plans are now close to optimisation and approaching completion. Further progress on the Pakrut project, post the year end, includes negotiating withpotential contractors for construction and the procurement of equipment. Two bulldozers,a D7 and D8, have been purchased, allowing for the provision of earthworks; in addition,an agreement has been signed to purchase two new and more powerful core drill rigsto continue exploration at greater depths at the Pakrut deposit. CNMIM Transaction and Finance Progress Following a number of months of technical and financial due diligence on the partof CNMIM, our Company was delighted to announce on 23 November 2010 the allotmentof 73,333,333 new ordinary shares in the Company at a price of 15p per share to CNMIM.This transaction raised approximately £11,000,000 before expenses for our Company,resulting in CNMIM holding 29.9% of our Company's shares. In addition, CNMIM werealso issued 73,333,333 warrants, each entitling CNMIM to subscribe for one ordinaryshare in the Company at a price if 21p per share. The proceeds of this Placing were immediately deployed to fund the development ofthe Pakrut Gold Project and accelerate exploration within the Pakrut Licensed Area,as well as to undertake further exploration at the Company's Hukas nickel-copperproject. As a condition of this investment, CNMIM had agreed to use its best endeavours tosecure debt financing of a minimum of 70% of the funding required to bring the PakrutGold Project into production. Following BFS approval by the Board in January 2011,the Export Import Bank of China ("China Eximbank") issued a LOI on 7 March 2011 confirmingits interest in providing 70% of the financing required by our Company for the Pakrutproject production development. The funding amount has been calculated as 70% ofthe total BFS capital expenditure estimate as prepared by the Beijing General ResearchInstitute of Mining & Metallurgy ("BGRIMM"), equal to approximately US$77,000,000.In addition, CNMIM has arranged for its parent company, China Nonferrous Metals GroupCo. Ltd., to act as guarantor in respect of the proposed financing from China Eximbank. The LOI is dependent on concluding final documentation and is subject to a numberof conditions including due diligence and further approvals, and is valid for sixmonths from the date of issue. Management and Operational Changes I am also pleased to report on a number of management and board level changes atthe Company. I was delighted to be appointed as Non-Executive Chairman, along withthe appointment of Mr We Li Tang (also known as David Tang) as a Non-Executive Director,in December 2010. As part of these changes, Dr Trevor Davenport agreed to step downas Non-Executive Chairman, remaining as a Non-Executive Director of our Company wherehis technical expertise and input continues to be significant. I am the President and a Director of China Nonferrous Metal Mining (Group) Ltd ("CNMC")and also a Director of CNMIM amongst others. Mr Tang is a Director of CNMIM. CNMIMis a PRC mining investment company with shareholders that include CNMC and 15 otherPRC mining industry shareholders. CNMIM has investments in mining projects in Zambia,Kyrgyzstan, Australia, Laos and the PRC. Since the beginning of 2011, we have further strengthened our team with two appointments.Li Li (also known as Leonard Lee) was appointed as Non-Executive Director of theCompany in January 2011. Leonard represents Golden Max Group Limited, our secondlargest shareholder with 13.4% of the Company's shares, and brings a wealth of corporatefinance experience to our team. Richard Li was appointed as our Chief Operating Officer.Richard has 28 years mining experience, as an engineer and department manager forChina ENFI Engineering Co. Ltd and more recently as Vice President of CNMIM. We have also appointed Evolution Securities Limited as our Nominated Advisor andJoint Broker in April 2011. Evolution's mining expertise and first-rate Nomad andbroking team strengthens our London AIM advisory team significantly. Finally, we were also very pleased to announce the legal registration of our BeijingRepresentative Office in February 2011. This office is responsible for the procurementof goods for the Pakrut Project as well as the provision of administrative servicesin China. I am very confident that the above changes will significantly strengthen our managementand advisory teams in terms of technical, logistical and financial expertise. Financial Results for the Year ended 31 December 2010 The amount spent by the Company on development work during the year increased by50% to US$2,640,000 (2009: US$1,759,000). Administration expenditure decreased by21% to US$935,000 (2009: US$1,184,000). The overall loss incurred by the Companydecreased by 11% from US$1,259,000 to US$1,117,000. Total cash equity funding raisedfrom exercising warrants and options during the period was US$2,654,998. Outlook Kryso has made significant technical progress during 2010 in advancing its 100% ownedPakrut gold project, and the detailed engineering design of the mine and plant isapproaching final optimisation. CNMIM's investment, and its progress in the workto secure debt funding for Pakrut's development, has moved the Company into a strongfinancial position from which to accelerate its progress toward full commercial production.I am therefore very confident that we remain on target to reach production in thesecond half of 2012. I would like to take this opportunity to thank all of our employees, management andadvisors for their efforts during 2010 and also thank our shareholders for theircontinued support of our Company. We look forward to our Company's further progressin the coming year. Tao Luo Non-Executive Chairman 9 June 2011 KRYSO RESOURCES PLC CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME - Year ended 31 December 2010 2010 2009 US$000 US$000 Turnover - - Cost of sales - - Gross Profit - Administrative expenses (935) (993) Exceptional expenses - (191) Loss on foreign exchange (193) (78) Operating Loss (1,128) (1,262) Interest receivable 11 3 Loss on Ordinary Activities before Taxation (1,117) (1,259) Tax on loss on ordinary activities - Loss on Ordinary Activities after Taxation attributable to equity holders of the Company (1,117) (1,259) Total comprehensive income attributable to equity holders of the Company (1,117) (1,259) Basic and Diluted Loss per Share attributable to equity holders of the Company (expressed in dollars per share) $(0.0065) $(0.0108) All of the activities of the Group are classed as continuing. The Company has taken advantage of section 408 of the Companies Act 2006 not to publishits own Statement of Comprehensive Income. KRYSO RESOURCES PLC CONSOLIDATED BALANCE SHEET - As at 31 December 2010 2010 2009 US$000 US$000 Fixed Assets Intangible assets 18,292 15,652 Tangible assets 84 63 18,376 15,715 Current Assets Inventories 722 518 Debtors 81 108 Cash and cash equivalents 16,591 1,826 17,394 2,452 Current Liabilities Trade and other payables (239) (383) (239) (383) Net Current Assets 17,155 2,069 Total Assets less Current Liabilities 35,531 17,784 Equity Called-up share capital 4,216 2,725 Share premium account 34,381 17,778 Retained earnings (3,066) (2,719) Total Equity 35,531 17,784 KRYSO RESOURCES PLC CONSOLIDATED STATEMENT OF CHANGES IN EQUITY - Year ended 31 December 2010 Attributable to owners of the parent Share capital US$000 Share premium US$000 Retained earnings US$000 Total US$000 Balance at 1 January 2009 1,680 14,529 (2,707) 13,502 Loss and comprehensive income for the year - - (1,259) (1,259) Share based payments - - 1,247 1,247 Issue of ordinary shares 1,045 4,722 - 5,767 Costs of share issues - (1,473) - (1,473) Balance at 31 December 2009 2,725 17,778 (2,719) 17,784 Loss and comprehensive income for the year - - (1,117) (1,117) Share based payments - - 770 770 Issue of ordinary shares 1,491 18,599 - 20,090 Costs of share issues - (1,996) - (1,996) Balance at 31 December 2010 4,216 34,381 (3,066) 35,531 The cost of share issues in the year ended 31 December 2010 for the Group and Companyincludes a charge of US$770,167 relating to the fair value of the placing warrants. KRYSO RESOURCES PLC CONSOLIDATED CASHFLOW STATEMENT - Year ended 31 December 2010 2010 2009 US$000 US$000 Net Cash Outflow from Operating Activities (1,443) (1,634) Cash flows from Investing Activities Payments to acquire intangible fixed assets (2,572) (1,660) Payments to acquire tangible fixed assets (95) (3) Interest received 11 3 Net Cash Outflow from Investing Activities (2,656) (1,660) Cash flows from Financing Activities Issue of equity share capital (net of issue costs) 18,864 3,940 Proceeds from borrowings - 727 Net Cash generated from Financing Activities 18,864 4,667 Net Increase in Cash and cash equivalents 14,765 1,373 Cash and cash equivalents at beginning of the year 1,826 453 Cash and cash equivalents at end of the year 16,591 1,826 KRYSO RESOURCES PLC NOTES TO THE CONSOLIDATED CASHFLOW STATEMENT - Year ended 31 December 2010 2010 2009 US$000 US$000 Reconciliation of Operating Loss to Net Cash Outflow from Operating Activities Operating loss (1,128) (1,262) Depreciation 6 11 Share based payments - 35 Increase in stocks (204) (66) Decrease/(Increase) in debtors 27 (30) Decrease in creditors (144) (437) Non-cash interest on convertible loan - 53 Foreign exchange on convertible loan - 62 Net Cash Outflow from Operating Activities (1,443) (1,634) Major non-cash transaction The Group and Company had the following major non-cash transactions during the year: Placing warrants were granted to investors during the year with a fair value of US$770,167which has been fully charged against the share premium account. In the year ended 31 December 2009, the convertible loan plus accrued interest fromGreat Basin Gold amounting to US$839,052 was converted into 10,723,389 ordinary sharesat a strike price of 5p per share. In addition, a mandatory convertible bond of US$727,250was received during 2009 from Vertex Mining International (Cyprus) Limited. Thiswas subsequently converted into 9,090,909 ordinary shares at a strike price of 5.5pper share. KRYSO RESOURCES PLC ACCOUNTING POLICIES Basis of Accounting These Financial Statements have been prepared in accordance with International FinancialReporting Standards (IFRSs) as adopted by the European Union, IFRIC interpretationsand those parts of the Companies Act 2006 applicable to companies reporting underIFRS. The Financial Statements have been prepared under the historical cost convention. The preparation of Financial Statements in conformity with IFRSs requires the useof estimates and assumptions that affect the reported amounts of assets and liabilitiesat the date of the Financial Statements and the reported amounts of revenues andexpenses during the reporting period. Although these estimates are based on management'sbest knowledge of the amount, event or actions, actual results ultimately may differfrom those estimates. Estimates and judgements are continually evaluated and arebased on historical experience and other factors, including expectations of futureevents that are believed to be reasonable under the circumstances. The functional currency of the Company and Group is US dollars and accordingly theamounts in the Financial Statements are denominated in that currency. The BalanceSheet rates of exchange for the US dollar to UK Sterling were $1.55 to £1 (2009:$1.59257 to £1). Basis of Consolidation The consolidated Financial Statements incorporate the Financial Statements of theCompany and all Group undertakings. These are adjusted, where appropriate, to conformto Group accounting policies. Subsidiaries are all entities over which the Grouphas power to govern the financial and operating policies accompanying a shareholdingof more than one half of the voting rights. All significant intercompany transactionsand balances between group undertakings are eliminated on consolidation. Investments in subsidiaries are accounted for at cost less impairment. Going Concern The Company's business activities, together with the factors likely to affect itsfuture development, performance and position are set out in the Chairman's Statementand the Business review in the Report of the Directors. The accounting policies includethe Company's objectives, policies and processes for managing its capital; its financialrisk management objectives; details of its financial instrument; and its exposureto liquidity risk. At the year end the Company and Group had a significant cash and cash equivalentsbalance following investment by CNMIM. This will be utilised to finance the Company'sand Group's operating expenses and ongoing exploration and evaluation costs. Basedon the budgeted levels of expenditure the Directors are satisfied that the cash resourcesavailable are sufficient to cover the Company's and Group's ongoing costs for atleast 12 months from the date of signing of these Financial Statements. With respect to the proposed development of a mining operation at Pakrut, it is intendedthat this will be the subject of separate debt funding. The Group has not made anycommitments in relation to the development of a mining operation at Pakrut. The absenceof financial or time constraints will allow the Group to put in place the necessaryfinancing arrangements required to bring the Pakrut gold resource into production. The Directors have a reasonable expectation that the Company and Group has adequateresources to continue in operational existence for the foreseeable future. Thus theycontinue to adopt the going concern basis of accounting in preparing the FinancialStatements. KRYSO RESOURCES PLC NOTICE OF ANNUAL GENERAL MEETING Notice is hereby given that the Annual General Meeting (the "Meeting") of Kryso ResourcesPLC (the "Company") will be held at the offices of Speechly Bircham LLP, 6 New StreetSquare, London EC4A 3LX at 10 a.m. on 30 June 2011 for the following purposes: Ordinary Business To consider and, if thought fit, to pass the following resolutions which will beproposed as ordinary resolutions: 1. To receive and consider the statement of accounts for the period ended 31 December2010 together with the reports of the directors and the auditors thereon. 2. To elect Wei Li Tang (also known as David Tang), who stands for election in accordancewith the Company's Articles of Association, as a director. 3. To elect Leonard Lee (also known as Li Li), who stands for election in accordancewith the Company's Articles of Association, as a director. 4. To elect Tao Luo, who stands for election in accordance with the Company's Articlesof Association, as a director. 5. To re-elect Dr Trevor Davenport, who retires by rotation in accordance with theCompany's Articles of Association, as a director. 6. To re-appoint Littlejohn LLP as auditors to act as such until the conclusion ofthe next General Meeting of the Company at which accounts are laid before the Companyand to authorise the directors of the Company to fix their remuneration. Special Business To consider and, if thought fit, to pass the following resolutions of which resolution7 will be proposed as an ordinary resolution and resolution 8 which will be proposedas a special resolution: 7. That the directors be and they are hereby generally and unconditionally authorisedin accordance with section 551 of the Companies Act 2006 ("the Act") to exerciseall powers of the Company to allot shares in the Company and to grant rights to subscribefor or convert any security into shares in the Company up to an aggregate nominalamount of £2,000,000, provided that the authority hereby conferred shall: (a) operate in substitution for and to the exclusion of any previous authority givento the directors pursuant to section 551 of the Act; and (b) expire on whichever is earlier of the conclusion of the next Annual General Meetingof the Company or the date falling 15 months from the date of the passing of thisresolution unless such authority is renewed, varied, or revoked by the Company ingeneral meeting, save that the Company may at any time before such expiry make anoffer or agreement which might require shares in the Company to be allotted, or rightsto subscribe for or to convert any security into shares in the Company to be granted,after such expiry and the directors may allot shares in the Company or grant rightsto subscribe for, or convert any security into, shares in the Company in pursuanceof such offer or agreement as if the authority hereby conferred had not expired. 8. That, subject to the passing of Resolution 7, the directors be and they are herebyempowered pursuant to sections 570 and 573 of the Act to allot equity securities(as defined in section 560 of the Act) for cash as if section 561(1) of the Act didnot apply to any such allotment pursuant to the general authority conferred on themby Resolution 7 above (as varied from time to time by the Company in general meeting)and/or by way of a sale of treasury shares PROVIDED THAT such power shall be limitedto: (a) the allotment of equity securities in connection with a rights issue or any otherpre-emptive offer in favour of holders of equity securities where the equity securitiesrespectively attributable to the interest of all such holders are proportionate (asnearly as may be) to the respective amounts of equity securities held by them subjectonly to such exclusions or other arrangements as the directors may consider appropriateto deal with treasury shares, fractional entitlements or legal or practical difficultiesunder the laws of or the requirements of any recognised regulatory body in any territoryor otherwise; (b) in connection with the issue of any shares pursuant to the exercise of any optionsgranted under the Company's unapproved employee share scheme, adopted by the boardof the Company on 24 November 2004 (as amended from time to time) up to an aggregatenominal amount of £80,000; (c) in connection with the issue of any share warrants to be granted by the Companyup to an aggregate nominal amount of £20,000; and (d) the allotment (otherwise than pursuant to sub paragraphs (a), (b) and (c) above)of equity securities up to an aggregate nominal amount of £1,000,000, and the power hereby conferred shall operate in substitution for and to the exclusionof any previous power given to the directors pursuant to sections 570 or 573 of theAct and shall expire on whichever is the earlier of the conclusion of the next AnnualGeneral Meeting of the Company or the date falling 15 months from the date of thepassing of this resolution unless such power is renewed, extended, varied or revokedprior to or at such meeting, except that the Company may before the expiry of anypower contained in this resolution make an offer or agreement which would or mightrequire equity securities to be allotted after such expiry and the directors mayallot equity securities in pursuance of such offer or agreement as if the power conferredhereby had not expired. By Order of the Board Craig Brown, Secretary Dated 7 June 2011 Registered Office: Unit 3H, Cooper House 2 Michael Road London SW6 2AD KRYSO RESOURCES PLC NOTES TO THE NOTICE OF GENERAL MEETING Entitlement to attend and vote 1. Pursuant to Regulation 41 of the Uncertificated Securities Regulations 2001, theCompany specifies that only those members registered on the Company's register ofmembers at: 6.00 p.m. on 28 June 2011; or if this Meeting is adjourned, at 6.00 p.m. on the day two days prior to the adjournedmeeting, shall be entitled to attend and vote at the Meeting. Appointment of proxies 2. If you are a member of the Company at the time set out in note 1 above, you areentitled to appoint a proxy to exercise all or any of your rights to attend, speakand vote at the Meeting and you should have received a proxy form with this noticeof meeting. You can only appoint a proxy using the procedures set out in these notesand the notes to the proxy form. 3. A proxy does not need to be a member of the Company but must attend the Meetingto represent you. Details of how to appoint the Chairman of the Meeting or anotherperson as your proxy using the proxy form are set out in the notes to the proxy form.If you wish your proxy to speak on your behalf at the Meeting you will need to appointyour own choice of proxy (not the Chairman) and give your instructions directly tothem. 4. You may appoint more than one proxy provided each proxy is appointed to exerciserights attached to different shares. You may not appoint more than one proxy to exerciserights attached to any one share. To appoint more than one proxy you may photocopyyour proxy card or contact Neville Registrars Limited to obtain an extra proxy cardon 0121 585 1131, or from outside the UK on +44 (0)12 1 585 1131. Lines are open9 am to 5 pm Monday to Friday, excluding UK bank holidays. 5. A vote withheld is not a vote in law, which means that the vote will not be countedin the calculation of votes for or against the resolution. If no voting indicationis given, your proxy will vote or abstain from voting at his or her discretion. Yourproxy will vote (or abstain from voting) as he or she thinks fit in relation to anyother matter which is put before the Meeting. Appointment of proxy using hard copy proxy form 6. The notes to the proxy form explain how to direct your proxy how to vote on eachresolution or withhold their vote. To appoint a proxy using the proxy form, the form must be: completed and signed; sent or delivered to Neville Registrars Limited, Neville House, 18 Laurel Lane,Halesowen, West Midlands B63 3DA; and received by Neville Registrars Limited no later than 10 a.m. on 28 June 2011. In the case of a member which is a company, the proxy form must be executed underits common seal or signed on its behalf by an officer of the company or an attorneyfor the company. Any power of attorney or any other authority under which the proxy form is signed(or a duly certified copy of such power or authority) must be included with the proxyform. Appointment of proxies through CREST 7. CREST members who wish to appoint a proxy or proxies by utilising the CREST electronicproxy appointment service may do so for the Meeting and any adjournment(s) thereofby utilising the procedures described in the CREST Manual (available from https://www.euroclear.com/site/public/EUI). CREST Personal Members or other CREST sponsored members, and those CRESTmembers who have appointed a voting service provider(s), should refer to their CRESTsponsor or voting service provider(s), who will be able to take the appropriate actionon their behalf. In order for a proxy appointment made by means of CREST to be valid, the appropriateCREST message (a CREST Proxy Instruction) must be properly authenticated in accordancewith Euroclear UK & Ireland Limited's (EUI) specifications and must contain the informationrequired for such instructions, as described in the CREST Manual. The message mustbe transmitted so as to be received by the issuer's agent (ID: 7RA11) by 11 a.m.on 28 June 2011. For this purpose, the time of receipt will be taken to be the time(as determined by the timestamp applied to the message by the CREST ApplicationsHost) from which the issuer's agent is able to retrieve the message by enquiry toCREST in the manner prescribed by CREST. CREST members and, where applicable, their CREST sponsors or voting service providersshould note that EUI does not make available special procedures in CREST for anyparticular messages. Normal system timings and limitations will therefore apply inrelation to the input of CREST Proxy Instructions. It is the responsibility of theCREST member concerned to take (or, if the CREST member is a CREST personal memberor sponsored member or has appointed a voting service provider(s), to procure thathis CREST sponsor or voting service provider(s) take(s)) such action as shall benecessary to ensure that a message is transmitted by means of the CREST system byany particular time. In this connection, CREST members and, where applicable, theirCREST sponsors or voting service providers are referred, in particular, to thosesections of the CREST Manual concerning practical limitations of the CREST systemand timings. The company may treat as invalid a CREST Proxy Instruction in the circumstances setout in Regulation 35(5)(a) of the Uncertificated Securities Regulations 2001. Appoint for proxy by joint members 8. In the case of joint holders, where more than one of the joint holders purportsto appoint a proxy, only the appointment submitted by the most senior holder willbe accepted. Seniority is determined by the order in which the names of the jointholders appear in the Company's register of members in respect of the joint holding(the first-name being the most senior). Changing proxy instructions 9. To change your proxy instructions simply submit a new proxy appointment usingthe methods set out above. Note that the cut-off time for receipt of proxy appointments(see above) also apply in relation to amended instructions; any amended proxy appointmentreceived after the relevant cut-off time will be disregarded. Where you have appointed a proxy using the hard-copy proxy form and would like tochange the instructions using another hard-copy proxy form, please contact NevilleRegistrars Limited on on 0121 585 1131, or from outside the UK on +44 (0)121 5851131. Lines are open 9 am to 5 pm Monday to Friday, excluding UK bank holidays. If you submit more than one valid proxy appointment, the appointment received lastbefore the latest time for the receipt of proxies will take precedence. Termination of proxy appointments 10. In order to revoke a proxy instruction you will need to inform the Company bysending a signed hard copy notice clearly stating your intention to revoke your proxyappointment to Neville Registrars Limited, Neville House, 18 Laurel Lane, Halesowen,West Midlands B63 3DA. In the case of a member which is a company, the revocationnotice must be executed under its common seal or signed on its behalf by an officerof the company or an attorney for the company. Any power of attorney or any otherauthority under which the revocation notice is signed (or a duly certified copy ofsuch power or authority) must be included with the revocation notice. The revocationnotice must be received by Neville Registrars Limited no later than 10 a.m. on 28June 2011. If you attempt to revoke your proxy appointment but the revocation is received afterthe time specified then, subject to the paragraph directly below, your proxy appointmentwill remain valid. Appointment of a proxy does not preclude you from attending the Meeting and votingin person. If you have appointed a proxy and attend the Meeting in person, your proxyappointment will automatically be terminated. Corporate representatives 11. A corporation which is a member can appoint one or more corporate representativeswho may exercise, on its behalf, all its powers as a member provided that no morethan one corporate representative exercises powers over the same share. Issued shares and total voting rights 12. As at 6.00 p.m. on 6 June 2011, the Company's issued share capital comprised255,447,917 ordinary shares of £0.01 each. Each ordinary share carries the rightto one vote at a general meeting of the Company and, therefore, the total numberof voting rights in the Company as at 6.00 p.m. on 6 June 2011 is 255,447,917. Communication 13. You may not use any electronic address provided either in this notice of meeting;or any related documents (including the letter with which this notice of meetingwas enclosed and proxy form) to communicate with the Company for any purposes otherthan those expressly stated.