notice of general meeting explanatory ...2014/07/23 · explanatory memorandum – and ... of the...

T +61 2 8203 5620

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Level 7, 71 Macquarie Str eet

Sydney NSW 2000 Australia

DOME GOLD MINES LTD

ABN 49 151 996 566

GPO Box 1759 Sydney

NSW 2001 Australia

E [email protected]

W www.domegoldmines.com.au

NOTICE OF GENERAL MEETING

– and –

EXPLANATORY MEMORANDUM

– and –

PROXY FORM

DATE & TIME OF MEETING: Monday, 25 August 2014 at 3.00pm

VENUE: Level 7, 71 Macquarie Street Sydney NSW 2000

These documents should be read in their entirety. If shareholders are in any doubt as to how

they should vote, they should seek advice from their professional advisors.

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DOME GOLD MINES LTD

ABN 49 151 996 566

GPO Box 1759 Sydney

NSW 2001 Australia

E [email protected]


1

NOTICE IS HEREBY GIVEN that a General Meeting (Meeting) of the members of Dome Gold Mines Ltd ACN

151 996 566 (Dome or the Company) will be held on Monday, 25 August 2014 at 3.00pm at Level 7, 71

Macquarie Street, Sydney, NSW 2000.

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

(Explanatory Memorandum).

AGENDA

ORDINARY RESOLUTION

Approval of the acquisition of Magma Mines Ltd and for the issue of Shares to the shareholders of Magma

Mines Ltd (“Magma Vendors”) as consideration therefor.

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

resolution:

"That, for the purposes of Listing Rule 7.1 and for all other purposes, approval is given for the

Company to allot and issue up to 78,617,198 Shares to the Magma Vendors or their

nominees (other than Tiger Ten Investment Ltd and Charvest Pty Ltd), for the purposes of

Listing Rule 10.11 for the Company to allot and issue up to 8,500,000 shares to Tiger Ten

Investment Limited and Charvest Pty Ltd (as Magma Vendors), and for the purposes of

Listing Rule 10.1 approval is given for the acquisition of all issued capital in Magma Mines Ltd,

which is partially owned by related parties to the Company, pursuant to the terms and the

Heads of Agreement and the Share Sale Agreement and otherwise on the terms and

conditions set out in the Explanatory Memorandum in the numbers and to the Magma

Shareholders set out in the Schedule to the Explanatory Memorandum”.

Short Explanation: Shareholder approval is sought for the purposes of Listing Rule 7.1, in accordance with

Listing Rule 7.3, for the Company to issue a number of securities that is more than 15% of its ordinary share

capital on issue at the commencement of the previous 12 month period (pursuant to the formula in Listing

Rule 7.1) to the Magma Vendors (other than Tiger Ten Investment Ltd and Charvest Pty Ltd) and under

Listing Rule 10.11 for the issue of 8,500,000 to the Magma Shareholders Tiger Ten Investment Ltd and

Charvest Pty Ltd as related parties to Dome. Shareholder approval is sought for the purposes of Listing

Rule 10.1 as the acquisition of Magma Mines Ltd constitutes a substantial asset to the Company and two

of the vendors of Magma Mines Ltd are related parties of the Company.

Voting Exclusions on this Resolution:

The Company will disregard any votes cast on this Resolution by a party to the transaction, any person

who may participate in the proposed issue and a person who might obtain a benefit, except a benefit

solely in the capacity of a holder of ordinary shares, if this Resolution is passed and any associate of those

persons.

However, the Company need not disregard a vote if:

(a) 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

(b) it is cast by the person chairing the meeting as a proxy for a person who is entitled to vote, in

accordance with a direction on the proxy form to vote as the proxy decides.

Explanatory Memorandum

Shareholders are advised to read the attached Explanatory Memorandum which forms part of this Notice

containing full details of the proposal for issue of the shares set out in the resolution.

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NSW 2001 Australia

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The Directors have determined pursuant to regulation 7.11.37 of the Corporations Regulations that

the persons eligible to vote at the Meeting are those who are registered as shareholders of the

Company at 3:00pm on Thursday 21 August 2014.

BY ORDER OF THE BOARD

Marcelo Mora

Company Secretary

Sydney, New South Wales

23 July 2014

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GPO Box 1759 Sydney

NSW 2001 Australia

E [email protected]


3

EXPLANATORY MEMORANDUM

1. INTRODUCTION

This Explanatory Memorandum has been prepared for the information of shareholders of Dome Gold

Mines Ltd. (“Dome” or the “Company”) in connection with the business to be conducted at the General

Meeting (“Meeting”) to be held on Monday, 25 August 2014 at 3.00pm at Level 7, 71 Macquarie Street

Sydney, New South Wales 2000.

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

(“Explanatory Memorandum”).

On 10 June 2014, the Company announced that it had entered into a conditional agreement to acquire

Magma Mines Ltd an entity with an interest in the Sigatoka Magnetite Project in the Republic of Fiji. The

Meeting has been convened to give effect to this transaction. The Magma acquisition will provide the

Company with an opportunity to expand its mineral resource interests to include a highly prospective

Magnetite project in Fiji. Sigatoka Project highlights are:

Widely regarded as the largest and most promising undeveloped iron sand deposit in Fiji

Sonic drilling programs have been completed onshore and in the Sigatoka River bed to delineate

partially the extent of magnetite-bearing sands

Results of that drilling are currently being utilised to produce an initial mineral resource estimate for

the project

A 150kg bulk sand sample collected from four sites onshore contained 7% magnetite and produced

a 58.5% Fe concentrate using simple and low cost gravity and magnetic recovery processes

Application for a mining licence to be submitted before the end of 2014

Potential to expand the resource in the area offshore from the Sigatoka river mouth

Synergies with Dome's Nasivi Delta iron sand project will eliminate duplication of management,

engineering, technical and marketing studies, staffing and operator training

Consolidation of Nasivi and Sigatoka will create economies of scale that will strengthen Dome’s

ability to market iron ore concentrates successfully

Acquisition of the Sigatoka Magnetite Project is a large but logical addition to the core mineral interests

already held by Dome. The Company is presently conducting sonic drilling of iron sands on its SPL1454,

offshore the Nasivi Delta in the north of Viti Levu. It thus has both the equipment and technical expertise

to progress the Sigatoka project to development expeditiously. Dome also has Asian investors and

business contacts that can facilitate marketing of magnetite concentrates. On completion of the

transaction, there will be no change of Directors of Dome.

The current Directors have agreed to put the Resolution to Shareholders and, separately, have approved

the information contained in this Explanatory Memorandum. All of the Directors intend to vote their Shares

in favour of the Resolution. Each of the Directors recommends Shareholders vote in favour of the

Resolution.

2. ISSUE OF SHARES TO MAGMA VENDORS

(a) Introduction

As announced on 10 June 2014, the Company has entered into the Heads of Agreement to acquire the

Sigatoka Magnetite Project in Fiji by purchasing all of the issued shares in an unlisted Australian company,

Magma Mines Ltd (“Magma”). The purchase consideration will comprise Shares in Dome, such that,

following the completion of the transaction, the former Magma shareholders will hold 40.97% of the issued

Shares in Dome.

Magma is a company incorporated in Australia which, through its wholly owned Fijian subsidiary Magma

Mines Ltd Fiji (“Magma Fiji”), holds Special Prospecting Licence 1495 (“SPL 1495”). SPL1495 is located on

the south coast of Viti Levu, the largest island of Fiji. It is approximately 80km south of Nadi and 160km

west of the capital, Suva. The tenement was first granted to Magma Fiji in 2007.

The Magma SPL1495 area covers 2,522.69 hectares on the plains at the mouth of the Sigatoka River, the

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river itself and an area off-shore. Sediment eroded from magnetite-heavy mineral bearing volcanic and

intrusive rocks inland was carried toward the sea by the river. As the river neared the ocean outlet, the

action of wind, current and waves caused concentrations of heavier minerals to form. Exploration

undertaken in the 1970s reported the presence of magnetite and other heavy minerals in the sand

deposits. This led Magma to “peg” the area west of the river as well as into the sea to cover the target

depositional environment area.

Further details of the Sigatoka Exploration Area are set out in paragraph (j) below.

On completion of the Magma transaction, the board of Dome will not be restructured.

(b) Structure of Dome

Dome has been listed as a public Company on the ASX Official List since 22 October 2013 (ASX:DME). The

total issued share capital of Dome is 125,526,283 ordinary fully paid shares. All of these shares are listed on

the ASX. 37,539,613 shares are tradeable and 86,320,000 shares are escrowed until 22 October 2015 and

1,666,670 shares are escrowed until 31 July 2014. All issued shares are of the same class and are fully paid

and carry the same voting entitlements. As at 31 December 2013 the cash, equipment and assets of the

Company totalled $3,121,048 plus $1,960,000 raised by share placements since 31 December 2013. There

have been no unusual purchases or sales of such assets since that date.

(c) Dome Assets

Dome holds three exploration tenements in Fiji as follows:

Tenement Location Holder Area

(Ha) Expiry Date

Interest

%

SPL 1451 Kadavu Island Group Dome Mines Ltd 4,440 22/08/2016 100

SPL 1452 Central Viti Levu Dome Mines Ltd 42,570 26/08/2016 100

SPL 1454 Nasivi Delta Viti Levu Dome Mines Ltd 12,508 22/08/2016 100

(d) Structure of Magma

The following diagram depicts the current corporate structure of the Magma group of companies:

(i) Magma Mines Ltd – is an unlisted Australian public company with 87,117,198 issued shares and 171

shareholders, incorporated on 9 August 2011.

(ii) Magma Mines Limited (Fiji) – is a Fijian exploration company, incorporated on 3 April 2006, and holder

of exploration licence SPL1495 in Fiji.

The Magma shareholders have held a general meeting of that Company to approve the sale of its assets

to Dome in consideration of the issue and allotment to the shareholders of Magma by Dome of the

number of Dome shares as set out in the Schedule to the accompanying Notice of Meeting. All of the

shareholders of Magma accepted an offer of one share in Dome for each of their shares in Magma at

that General Meeting.

After the completion of the sale Dome will be the beneficial owner of all shares in and the assets of

Magma. There is no other consideration for the sale of the Magma assets to Dome.

Magma Mines Ltd

(ACN 152 803 159)

Magma Mines Limited (FIJI)

(Company Nº 18594)

100%

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(e) Magma Assets

Magma holds one exploration tenement in Fiji as follows:

Tenement Location Holder Area

(Ha) Expiry Date

Interest

%

SPL 1495 Sigatoka Magma Mines Ltd 2,522.69 13/2/15 100

(f) The Officers of Dome

Four Directors comprise the Board of Dome:

Garry Lowder

Tadao Tsubata

Andrew Skinner

Allen Jay

(g) The Shareholders of Dome

The five largest shareholders of Dome as at 9 July 2014 hold 52.67% of the present issued shares in Dome.

There are presently 438 shareholders of Dome and the largest five shareholders, and the percentage of

share capital owned by each as at 17 July 2014 is as follows:

Shareholder Shares Percentage of

Capital

Onizaki Corporation 30,000,000 23.90%

Tiger Ten Investment Limited 20,090,000 16.00%

Brave Top Enterprises Ltd 5,500,000 4.38%

Cybersys Inc 5,500,000 4.38%

Charvest Pty Ltd 5,025,000 4.00%

(h) The proposal

Dome has entered into a Share Sale Agreement with Magma and each Magma Shareholder under which

it will acquire 100% of the Magma issued share capital and through such acquisition the assets of Magma.

This agreement is subject to the approval of Dome shareholders. Magma shareholders have already

approved the proposal at a general meeting. Under the terms of the Share Sale Agreement, Dome

agrees to issue and allot 87,117,198 ordinary fully paid Dome shares to Magma Shareholders upon

approval by shareholders of Dome of the first resolution to be considered at this meeting. The agreed

value for each of such shares is $0.26 making a total of $22,650,471 as the value of the sale consideration.

Under the terms of the agreement each Magma Shareholder will receive one Dome share for each

Magma share held at the date of completion. Of the 87,117,198 shares to be so issued and allotted, a

total of 8,500,000 shares will be issued and allotted to Tiger Ten Investment Ltd (6,250,000) and Charvest Pty

Ltd (2,250,000) as related parties of Dome pursuant to Listing Rule 10.11 and the balance of 78,617,198

shares to the other Magma Vendors.

(i) Independent Report on Value of Consideration

Under the regulatory regime which applies to transactions of the nature of the issue and allotment of

shares proposed by the resolution it is most desirable that an expert’s opinion on the merits of the share

issue be made available to shareholders. The Directors have, accordingly, commissioned Brent Goldman

of Nexia Court Financial Solutions Pty Ltd, Chartered Accountants, to provide a report to Dome

shareholders on the proposed share issue to Magma Shareholders (the “Nexia Report”). This report is

annexed to this Explanatory Memorandum. Brent Goldman of Nexia Court Financial Solutions Pty Ltd

consents to the inclusion of the report in this Explanatory Memorandum. The Directors draw shareholders’

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attention to the conclusions of the Nexia Report as set out therein. The Nexia Report concluded that the

proposed transaction is fair and reasonable for the non-associated shareholders of Dome.

All Directors of Dome recommend that shareholders vote in favour of the share issue proposed by the

Resolution and intend to vote all the Company’s shares controlled by them in favour of the Resolution.

The Directors of Dome are all of the view that the information provided during their due diligence

enquiries into the purchase of Magma shares and Magma assets justify the proposed future planned

expenditure in relation to such assets and no Director of Dome has or will acquire any interest in Magma

as a result of the proposed acquisition other than as an existing shareholder in Dome.

The agreed value for the Dome shares to be issued and allotted pursuant to the Resolution is believed by

Directors to be reasonable considering current market conditions and the present value and prospective

value of the Magma assets and their location.

(j) Sigatoka Magnetite Project, Fiji

The Sigatoka Magnetite Project lies within SPL1495, on the south coast of Viti Levu, the largest island of Fiji.

It is approximately 80km south of Nadi and 160km west of the capital, Suva. The tenement was first

granted to Magma Mines Ltd in 2007, and was renewed on 14 February 2012 for a period of three years,

expiring on 13 February 2015.

Figure 1: SPL 1495 area map

SPL1495 covers an area of 2,522.69 hectares on the plains at the mouth of the Sigatoka River, the river itself

and an area offshore. The targeted sand comprises sediment that was eroded from magnetite-bearing

volcanic and intrusive rocks inland and was carried toward the sea by the river. As the river neared the

marine outlet, the action of wind, current and waves has caused concentrations of heavier minerals to

form. Exploration undertaken by other parties in the 1970s reported the presence of magnetite and other

heavy minerals in the Sigatoka sand deposits. This led Magma to acquire tenure to the area west of the

river as well as into the adjacent sea to cover the target depositional environment area (Fig. 1).

Geology of the Area

The satellite image below (Fig. 2) shows the main geological features of the Sigatoka area. The alluvial

sands cover a down-thrown fault block and are underlain by a combination of marls and limestone debris.

The Sigatoka river course was initially along the western margin of this alluvial plain and has migrated

eastward, gradually building up the large sand deposits with the assistance of the prevailing southeasterly

trade winds and ocean currents.

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Figure 2: Aerial image of Sigatoka, showing outline of onshore iron sand deposits (yellow line)

Large volumes of sand containing visible magnetite have accumulated on the western side of the river

mouth, as is evident in the satellite image.

Exploration to date

The aerial extent of visibly mineralised sand at Sigatoka, together with initial drill testing and volume

estimates, indicates that onshore alluvial material may amount to as much as 500 million to 1 billion tonnes

of mineralised sand. There is also a considerable quantity of mineralised sand in the river bed and offshore

within the Magma exploration area. Delineation of this implied large potential deposit will require

systematic drilling and sampling, the success of which is not guaranteed, although drilling completed to

date supports an optimistic view regarding the ultimate scope of the Sigatoka Magnetite Project. It is

emphasized that there is as yet no certainty that completion of exploration will result in the estimation of a

Mineral Resource.

A sonic drilling program of 43 drill holes was undertaken on the inland sand deposits during 2012

(excluding the island, river bed and offshore deposits). The area was drilled with holes at 400 metre centres

(and in some cases 200m centres), which showed average heavy mineral content from surface to be

approximately 15% with an average thickness of sand of approximately 20m. Note: this average thickness

may be understated since some holes did not reach bedrock where sand deposits exceeded 36-40

metres in depth.

Early in 2013, a bulk 150kg sample of the sand collected from shallow pits (approx. 2m deep) at five of the

drill hole sites was submitted to Robbins Metallurgical in Brisbane for pilot plant processing and chemical

analyses. Magnetite, ilmenite and other heavy mineral components in the concentrates produced were

chemically analysed and underwent QEMSCAN1 mineral identification. The bulk sample was processed

through equipment to simulate a commercial mineral recovery plant with magnetite and non-magnetic

concentrates produced. It contained 37.8% heavy minerals which comprised 7.05% magnetite that, when

concentrated, assayed 58.54% Fe, typical of commercial grade iron ore. The non-magnetic concentrate

contained a high proportion of the mineral diopside that may have use in metal casting industries (see

Dome ASX Announcement dated 10 June 2014 - Dome confirms that is not aware of any new information

or data that materially affects the information included in such Technical Report).

Magma undertook a second phase sonic drilling campaign in January 2014. A total of 80 holes were

drilled and laboratory analysis of half core samples is still underway. Heavy mineral results have been

1 QEMSCAN is a trademark name representing Quantative Evaluation of Minerals by Scanning Electron Microscopy.

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received for 32 of those later drill holes and magnetic mineral percentages at 300 Gauss2 have been

received from composite samples for 23 holes. The early results are encouraging and show strongest

magnetite concentrations in the upper 10 to 15m of sand deposits in the river bed.

Based on the positive outcomes of the onshore 2012 drilling program, the bulk sample test program of

2013 and early results from 2014 drilling by Magma, Dome plans to continue using sonic drilling to define

the deposit, and proposes to drill magnetite sands present on Koroua Island shortly after completion of this

transaction. A bridge has been constructed to gain access to the island (Fig. 3). Results from the island

and river drilling (Fig. 4) will be used later in 2014 to compile a JORC 2012 compliant resource estimate

that will support an application to the Mineral Resources Department of Fiji for a Mining Licence.

The Sigatoka iron sand mineralisation is easily accessible and mining is expected to employ low-cost

dredging methods commonly used in the mineral sand mining industry. The magnetite and other heavy

minerals of value are recovered as concentrates by various combinations of gravity, electrostatic and

magnetic processes that are already widely used in the mineral sands industry. Once a deposit has been

shown to be economic to mine, development and concentrate production can occur very quickly.

Figure 3: Bridge constructed by Magma to gain access for the sonic drill rig to Koroua Island in the Sigatoka River

Sample recovery with the sonic drill rig has been exceptional with virtually 100% of the sandy sediments

recovered. Magnetite is present from surface to the bedrock interface in all holes drilled to date with

some sections of holes exceeding 20 to 30% heavy minerals by volume. The material drilled ranges from

fine to coarser magnetite-bearing sand, with at least two distinct populations: a brown beach-like or dune

sand in the upper sections of holes; and a steely grey finer sand in the deeper parts of the holes. A shell-

rich bed commonly marks the base of the magnetite sand mineralisation, with calcareous marls forming

the bedrock.

The sequence is very predictable and uniform across the 43 holes completed in 2012. Studies are now

underway to determine whether the deposit has been further enhanced by “high-grade” strand lines3

that may lie parallel to sand dunes and/or channel ways within the mineralisation.

2 Gauss is a unit of measurement of magnetic induction in this case a low level of magnetic induction used to recover

strongly magnetic minerals such as magnetite. 3 These are a common feature of heavy mineral sand deposits in other parts of the world.

Figure 4: Magma’s sonic drill being mounted on a barge for drilling in the Sigatoka River bed

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There are several features of the mineralised area at Sigatoka that should be economically advantageous

if and when mining commences. In the first instance, the organic overburden or soil layer is generally less

than 1m in thickness and is immediately underlain by magnetite-bearing, orange to brown beach sand.

Holes drilled to date have extended from the far north of the deposit, at its most inland development, to

the river bank near the sea and show a general thickening of sand from 10-12m inland to greater than

35m of sand toward the south and east (i.e. toward the present day Sigatoka River channel and the sea).

Another important feature of the sand from an economics point of view is its very low clay (slimes) content,

which was 4.8% in the bulk sample. This means the washing of the material through the processing plant

will likely create minimal slimes, making the management of tailing and wash water easier and less costly.

Although water is present within the sands they do not appear to be flooded with free flowing water,

another positive feature from a mining perspective.

In conclusion, results to date indicate that the Sigatoka iron sand deposit has a high probability of

containing commercial concentrations of magnetite and possibly other heavy minerals and it is

reasonable to expect that a large and economically exploitable magnetite/heavy mineral sand deposit

can be defined during 2014.

Looking Ahead

Upon successful acquisition of Magma, Dome intends to proceed as quickly as possible to identify and

define a Mineral Resource at Sigatoka that will form the basis of a mining licence application and

feasibility study. A positive outcome from that study will lead to rapid mine development utilizing

conventional dredging and heavy mineral metallurgical techniques to produce an iron ore product, as

magnetite sand, whose target market will be in Asia.

The Company also intends to continue the drilling and evaluation of its Nasivi iron sands in the north of Viti

Levu, as well as exploration at its Fijian epithermal gold and porphyry copper-gold projects at Kadavu and

Nadrau, respectively. It is envisaged that cash flow from mining at Sigatoka will fund detailed drilling and

evaluation of Nasivi and any discoveries made in the future at Kadavu and Nadrau. This should allow

Dome to grow organically and become a substantial mining company based on high quality assets in Fiji.

(k) Magma’s Transaction Documents

A summary of the key agreements and their commercial terms are summarised as follows:

Heads of Agreement between the Company and Magma and Share Sale Agreement between the

Company, Magma and the Magma shareholders.

The Company will purchase 100% of the Magma shares held by each Magma shareholder. Purchase

consideration will comprise approximately 87,117,198 Shares in Dome, equating to 40.97% of the issued

shares in the Company following the completion of the transaction.

The agreements also contain warranties and undertakings of the type usually found in agreements of this

nature.

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(l) Effects of Transaction on the Company

(i) Pro forma capital structure

The pro forma capital structure of the Company following the Completion Date will be as follows:

Shares Number Diluted

Total issued shares in Dome Gold Mines Ltd 125,526,283

Issue of Shares to Magma Vendors 87,117,198

Total 212,643,481

(ii) Proforma Statement of Financial Position

The pro-forma Statement of Financial Position of the Company by reason of the Magma transaction is set

out below.

Actual

31 December 2013

$

Proforma

31 December 2013

$

Current assets

Cash & cash equivalents 3,661,730 3,738,229

Receivables 57,320 210,529

Other 150,000 160,265

Total current assets 3,869,050 4,109,023

Non-current assets

Property, Plant & equipment 2,935 559,361

Mineral interest acquisition, exploration and

development assets

1,149,759

23,824,974

Other 59,304 85,029

Total non-current assets 1,211,998 24,469,364

Total assets 5,081,048 28,578,387

Current liabilities

Payables 66,042 459,597

Total current liabilities 66,042 459,597

Non-current liabilities

Borrowings - 2,704,274

Total current liabilities - 2,704,274

Total liabilities 66,042 3,163,871

Net assets

5,015,006

25,414,516

Equity

Contributed equity 7,729,642 30,380,113

Reserves 25,791 35,996

Accumulated losses (2,740,427) (5,001,593)

Total equity

5,015,006

25,414,516

Notes: In preparing the Pro forma Statement of Financial Position, the Company has used its December

2013 Statement of Financial Position and Magma’s December 2013 Statement of Financial Position. The

substantive pro forma adjustments made are:

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The accounting for the issue of 87,117,198 Dome Shares as consideration for the purchase of

Magma shares at a deemed issue price of $0.26 per Share (being the last transaction closing price

of $0.26 per Share at the time of preparing this Explanatory Memorandum adjusted for intangibles)

in Dome Financial Statements.

The placement of 1,769,230 ordinary shares issued by Dome on 20 May 2014 and the placement of

1,923,077 ordinary shares issued by Dome on 7 July 2014 and the placement of 4,166,666 ordinary

shares issued by Dome on 17 July 2014 raising a total cash amount of $1,960,000 in Dome Financial

Statements.

The net present value of Magma borrowings adjusted by $120,827 in Magma Financial Statements.

(m) Largest Shareholders in Dome After Issue of Shares

The largest five shareholders after issue of shares to Magma shareholders will be:

Shareholder Shares Percentage of

Capital

Onizaki Corporation 30,000,000 14.11%

Tiger Ten Investment Limited 26,350,000 12.39%

Hillside Meadows Ltd 18,750,000 8.82%

Long-Last Enterprises Ltd 16,000,000 7.52%

Summerfell Investments Ltd 14,000,000 6.58%

The above share numbers and percentages assume no other relevant share issues or transfers take place.

(n) Changes to Board of Directors

The present Directors of Magma are John McCarthy, Ian Bell and Sarah Harvey. Immediately following

the issue of shares to Magma Shareholders proposed by the resolution, all three present directors of

Magma shall resign and Garry Lowder, Tadao Tsubata and Andrew Skinner shall be appointed as

Directors of Magma.

(o) Conflict of interest of directors

In the event that a conflict of interest arises, all Directors of Dome will be required to observe their

respective legal and fiduciary obligations. The types of obligations that directors have are imposed by

statute (eg the Corporations Act) and the general law. Under the Corporations Act, a director of a public

company must not be present at a directors’ meeting while a matter in which the director has a material

personal interest is being considered and must not vote on the matter. Under the Corporations Act

directors must exercise their powers and discharge their duties in good faith in the best interests of the

relevant corporation and for a proper purpose. Under the Corporations Act directors must not improperly

use their position to gain an advantage for themselves or someone else or to cause detriment to the

corporation. Under the general law directors are under a duty to act bona fide in the best interests of the

company. Under the general law directors, like other fiduciaries, are required not to put themselves in a

position where there is a conflict (actual or potential) between their personal interests and their duties to

the company.

(p) Risk Factors

There are a number of risks, both company specific to Dome and general investment risks, which may

materially and adversely affect the future operating and financial performance and financial condition of

Dome and the value of the Company. While some of these risks can be mitigated by the use of

appropriate safeguards and systems, many of them are outside the control of the Company and its

Directors. There can be no guarantee Dome will achieve any objectives that are intended to arise from

the issue of shares or that any projections or forecasts will eventuate. All of the tenements of both Dome

and Magma are located in Fiji.

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T +61 2 8203 5620

F +61 2 9241 2013



DOME GOLD MINES LTD

ABN 49 151 996 566

GPO Box 1759 Sydney

NSW 2001 Australia

E [email protected]


12

(q) Specific Information required under ASX Listing Rules

Listing Rule 7.1 provides, subject to certain exceptions, a listed company must not issue equity securities

where the number of equity securities proposed to be issued represents more than 15% of the Company’s

shares then on issue without the approval of shareholders.

The issue of Shares to Magma Vendors will exceed the Company's 15% capacity under Listing Rule 7.1.

The purpose of Resolution 1 is to seek Shareholder approval to issue Shares to Magma Vendors as the

consideration payable for the acquisition of Magma.

Listing Rule 7.3 and 10.13 sets out the matters which must be included in the notice of meeting convened

to seek Shareholder approval under Listing Rule 7.1 and 10.11. For the purposes of those Listing Rules, the

following information is provided to Shareholders in relation to the Resolution.

(i) The maximum number of Shares to be issued to the Magma Vendors by the Company is

87,117,198 of which 8,500,000 are to be issued to related parties to Dome.

(ii) The Shares will be allotted and issued no later than one month after the date of this Meeting. All

the Shares will be allotted and issued within that period.

(iii) The Shares will be issued for a deemed issue price of approximately $0.26 each adjusted for

intangibles.

(iv) The allottees of the securities will be Magma Vendors as listed in the Schedule to this Explanatory

Memorandum (including the related parties Tiger Ten Investment Ltd – 6,250,000 shares and

Charvest Pty Ltd – 2,250,000 shares)

(v) The Shares issued will be fully paid ordinary shares of the Company that rank equally with the

Company's current issued Shares.

(f) No funds will be raised by issue of these Shares, which form the consideration payable by the

Company for the acquisition of Magma.

Listing Rule 10

ASX Listing Rule 10 provides that a Company may not acquire a substantial asset from a related party

without the approval of its shareholders. Tiger Ten Investments Limited and Charvest Pty Ltd are related

parties by virtue of them being also shareholders of Magma. Such acquisition (the acquisition of Magma

and its assets) is a substantial asset as the value thereof exceeds 5% of the total equity interests of Dome.

Dome is therefore seeking the approval of shareholders to this acquisition under Listing Rule 10.1 to the

extent that it is (in part) an acquisition from a related party.

A voting exclusion statement is included with the Resolution.

The information in this Explanatory Memorandum that relates to the Sigatoka Magnetite Project has been

compiled by Mr Allen Jay who is a Director and geological consultant to the Company. Mr Jay is a

geologist who is a Member of the Australian Institute of Mining and Metallurgy and has sufficient

experience which is relevant to the style of mineralisation and type of deposit under consideration and to

the activities which he is undertaking to qualify as a Competent Person as defined in the 2012 Edition of

the ‘Australian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves’. Mr Jay

holds shares in the Company and consents to the inclusion in this report of the matters based on

information in the form and context in which it appears.

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SCHEDULE OF MAGMA VENDORS

Name Nº of shares

Hadeon Valley Holdings Inc. 6,250,000

Hillside Meadows Ltd 15,000,000

Globe Street Investments Pty Ltd

(A/C Globe Street Investments Trust) 5,000,000

Globe Street Investments Pty Ltd

(A/C FRG Superannuation Fund) 5,000,000

Charvest Pty Ltd 2,250,000

Kimcroft Trading Pty Ltd 5,000,000

SST Trading Pty Ltd (A/C Go Forth

Investment Trust) 1,500,000

MB & HF Skinner (A/C HFS Executive

Superannuation Fund) 250,000

Integral Admin Services Pty Ltd 100,000

Allen Jay 100,000

Suliana Niurou 100,000

J. B.A. McCarthy Superannuation

Fund Pty Ltd 100,000

Peter Litras 50,000

Rachel Ye 20,000

Danni Fan 20,000

Yawen Chen 20,000

Thamadia Nominees Pty Ltd (A/C

Jean White Superannuation Fund) 2,500,000

Allen Jay 150,000

J. B.A. McCarthy Superannuation

Fund Pty Ltd 150,000

Yuping Guan & Bin Yu 30,000

Long -Last Enterprises Ltd 16,000,000

Summerfell Investments Ltd 14,000,000

Tiger Ten Investment Limited 6,250,000

Sarah Harvey 500,000

Sarah Harvey 500,000

Minoru Kobayashi 10,000

Keiko Asami 10,000

Kouta Asami 10,000

Hiroshi Asami 10,000

Takayuki Anno 10,000

Yoshio Ikari 10,000

Yasuaki Ito 10,000

Kayoko Inada 10,000

Kazuyo Inoue 10,000

Hideki Inoue 10,000

Hideko Inoue 10,000

Susumu Uematsu 10,000

Yasuko Uematsu 10,000

Hisako Ushijima 10,000

Yukiko Uchiyama 10,000

Masataka Urashita 10,000

Kyona Enomoto 10,000

Tomohito Enomoto 10,000

Yoshine Enomoto 10,000

Hiroyuki Ooshima 10,000

Masako Ootaka 10,000

Keiko Oohata 10,000

Toshinori Okayama 10,000

Yachiyo Oguri 10,000

Name Nº of shares

Yuko Obata 10,000

Eng Chee Ong 10,000

Kimiko Kashiki 10,000

Miki Katsu 10,000

Naoko Kaneko 10,000

Masafumi Kaneko 10,000

Marie Kaneko 10,000

Mitsumasa Kaneko 10,000

Norifusa Kama 10,000

Nobuko Kamachi 10,000

Toshinori Kamijo 10,000

Nobuko Kamijo 10,000

Toshinobu Kawakami 10,000

Keiko Kitada 10,000

Yuka Kiyohara 10,000

Katsumi Kubosaki 10,000

Waka Kurahashi 10,000

Kenshi Kojima 10,000

Seiji Kojima 10,000

Takae Kojima 10,000

Asako Kobayashi 10,000

Eiko Kobayashi 10,000

Takahisa Kobayashi 10,000

Nobue Kobayashi 10,000

Noriko Kobayashi 10,000

Masayuki Kobayashi 10,000

Yasuko Kobayashi 10,000

Yoshiaki Kobayashi 10,000

Kazuhiro Kobari 10,000

Keiko Kobari 10,000

Yukio Komura 10,000

Maiko Saika 10,000

Yoshikazu Saika 10,000

Yasunari Saito 10,000

Misuzu Sakurai 10,000

Yuko Sasahara 10,000

Koichi Sato 10,000

Daisuke Sato 10,000

Tiger Ten Investment Limited 10,000

Seiji Suzuki 10,000

Masae Suzuki 10,000

Mayumi Suzuki 10,000

Yumi Suwa 10,000

Kunie Taki 10,000

Hiroko Tateno 10,000

Yukinobu Tateno 10,000

Lai Lin Chin 10,000

Hiroko Tokita 10,000

Kazuhiro Tokito 10,000

Ayako Toshida 20,000

Yumiko Nakashima 10,000

Hitoshi Naganuma 10,000

Nobuyuki Nakano 10,000

Taeko Nagare 10,000

Kajiko Nasu 10,000

Kazuaki Nasu 10,000

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Name Nº of shares

Yuki Hasegawa 10,000

Tadao Tsubata 10,000

Akemi Tsubata 10,000

Sanae Hijikuro 10,000

Ayako Hirata 10,000

Hiromi Nishioka 10,000

Yumiko Fujimoto 10,000

Hideki Bessho 10,000

Yuji Honda 10,000

Hitoshi Matsushita 10,000

Mieko Matsumura 10,000

Yoshiko Mizuno 10,000

Teruo Misono 10,000

Yoshinori Misono 10,000

Midori Miyagawa 10,000

Manabu Miyake 10,000

Shinichi Miyamoto 10,000

Eri Murakami 10,000

Chie Murakami 10,000

Hiroko Murakami 10,000

Kyoko Murotsu 10,000

Haja Moon 10,000

Shoji Mori 10,000

Fumi Mori 10,000

Kunie Yanagi 10,000

Keiko Yamasaki 20,000

Kayoko Yamashita 10,000

Shuzo Yamashita 10,000

Chizuru Yamashita 10,000

Yutaka Yamashita 10,000

Tomoe Yamada 10,000

Reiko Yutoku 10,000

Noboru Wada 10,000

Shoji Watanabe 10,000

Toshiro Endo 10,000

Yorinobu Fukuda 10,000

Osamu Kaneko 20,000

Ko Kobayashi 10,000

Miyuki Kobayashi 10,000

Yoko Harada 10,000

Tori Maeda 10,000

Satomi Sugawara 10,000

Yuriko Sato 10,000

Ritsuko Okumura 10,000

Ikuo Okumura 10,000

Nobuko Takahashi 10,000

Yuriko Yokoyama 20,000

Fumiko Tajima 10,000

Naoko Kimura 10,000

Daisuke Nakamura 10,000

Kenji Eto 10,000

Ikumi Eto 10,000

Setsuko Iwanaga 20,000

Susumu Iwanaga 10,000

Kazushi Niijima 10,000

Kotaro Hamashima 10,000

Tomie Goto 10,000

Hidekatsu Oyama 10,000

Mariko Oyama 10,000

Noriko Sakurai 10,000

Name Nº of shares

Tadao Tsubata (ATF Hiro Tsubata) 10,000

Tadao Tsubata (ATF Riki Tsubata) 10,000

Shuji Irisawa 10,000

SST Trading Pty Ltd (A/C Go Forth

Investment Trust) 250,000

Tomoyoshi Hirata 10,000

Hiroshi Harada 250,000

Excellent Fortune Inc, 20,000

Takashi Suga 250,000

Shuji Irisawa 78,420

Fumio Tanida 250,000

Akio Kawato 1,250,000

Hiroshi Harada 166,666

Takashi Suga 166,666

Akio Kawato 166,666

Precious Tori Ltd 554,166



87,117,198

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DOME GOLD MINES LTD (ACN 151 996 566) PROXY FORM Shareholder:

Appoint a Proxy to vote on your behalf

I/We being a member/s of Dome Gold Mines Ltd and entitled to attend and vote hereby appoint

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

General Meeting of Dome Gold Mines Ltd to be held on 25 August 2014 and at any adjournment of that

meeting.

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

For Against Abstain*

Approval of the Acquisition of Magma Mines Ltd and of Issue of

Shares to Magma Vendors

If the Chairman of the Meeting is appointed as your proxy, or may be appointed by default and 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 any resolution 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 in favour of all the resolutions in which

the Chairman is entitled to vote undirected proxies.

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.

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: ___/___/2014

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 your own name) you are appointing as your proxy.

The Chairman of

the meeting

(mark with an “X”)

OR

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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.

Lodgment 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 (Sydney time) on 21 August 2014. Any Proxy Form received after that time will not be valid for the

scheduled meeting.

_________________________________________________________________________________________________________________

Documents may be lodged:

IN PERSON: Registered Office – Level 7, Macquarie Street, Sydney, NSW 2000, Australia

BY MAIL: GPO Box 1759, Sydney, NSW 2001, Australia

BY FAX: +61 2 9241 2013

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Dome Gold Mines Ltd Proposed acquisition of Magma Mines Ltd Independent Expert’s Report and Financial Services Guide We have concluded that the proposed acquisition of Magma Mines Ltd is fair and reasonable to the non-associated shareholders of Dome Gold Mines Ltd 21 July 2014

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FINANCIAL SERVICES GUIDE

Dated: 21 July 2014 What is a Financial Services Guide (“FSG”)? This FSG is designed to help you to decide whether to use any of the general financial product advice provided by Nexia Court Financial Solutions Pty Ltd ABN 88 077 764 222, Australian Financial Services Licence Number 247300 (“NCFS”). This FSG includes information about:

• NCFS and how they can be contacted • the services NCFS is authorised to provide • how NCFS are paid • any relevant associations or relationships of NCFS • how complaints are dealt with as well as information about internal and external dispute

resolution systems and how you can access them; and • the compensation arrangements that NCFS has in place.

Where you have engaged NCFS we act on your behalf when providing financial services. Where you have not engaged NCFS, NCFS acts on behalf of our client when providing these financial services and are required to provide you with a FSG because you receive a report or other financial services from NCFS. Financial services that NCFS is authorised to provide NCFS holds an Australian Financial Services Licence, which authorises it to provide, amongst other services, financial product advice for securities and interests in managed investment schemes, including investor directed portfolio services, to retail clients. We provide financial product advice when engaged to prepare a report in relation to a transaction relating to one of these types of finance products. NCFS's responsibility to you NCFS has been engaged by the directors of Dome Gold Mines Ltd (“Dome” or the “Client”) to provide general financial product advice in the form of a Report to be included in the Explanatory Memorandum attached to a Notice of Meeting (“Document”) prepared by Dome in relation to the proposed acquisition of Magma (“Magma”) (the “Proposed Transaction”). You have not engaged NCFS directly but have received a copy of the Report because you have been provided with a copy of the Document. NCFS or the employees of NCFS are not acting for any person other than the Client. NCFS is responsible and accountable to you for ensuring that there is a reasonable basis for the conclusions in the Report. General Advice As NCFS has been engaged by the Client, the Report only contains general advice as it has been prepared without taking into account your personal objectives, financial situation or needs. You should consider the appropriateness of the general advice in the Report having regard to your circumstances before you act on the general advice contained in the Report. You should also consider the other parts of the Document before making any decision in relation to the Scheme.

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Fees NCFS may receive NCFS charges fees for preparing reports. These fees will usually be agreed with, and paid by, the Client, Fees are agreed on either a fixed fee or a time cast basis. In this instance, the Client has agreed to pay NCFS $32,000 to $36,000 (excluding GST and out of pocket expenses) for preparing the Report. NCFS and its officers, representatives, related entities and associates will not receive any other fee or benefit in connection with the provision of this Report. Referrals NCFS does not pay commissions or provide any other benefits to any person for referring customers to them in connection with a Report. Associations and relationships Through a variety of corporate and trust structures NCFS is controlled by and operates as part of the Nexia Court & Co Partnership. NCFS's directors and authorised representative may be partners in the Nexia Court & Co Partnership. Mr Brent Goldman, authorised representative of NCFS and partner in the Nexia Court & Co Partnership, has prepared this report. The financial product advice in the Report is provided by NCFS and not by the Nexia Court & Co Partnership. From time to time NCFS, the Nexia Court & Co Partnership and related entities (Nexia entities) may provide professional services, including audit, tax and financial advisory services, to companies and issuers of financial products in the ordinary course of their businesses. Over the past two years no professional fees have been received from the Client. No individual involved in the preparation of this Report holds a substantial interest in, or is a substantial creditor of, the Client or has other material financial interests in the Proposed Transaction. Complaints resolution If you have a complaint, please let either NCFS know. Formal complaints should be sent in writing to: Nexia Court Financial Solutions Pty Ltd Head of Compliance PO Box H195 Australia Square NSW 1215 If you have difficulty in putting your complaint in writing, please telephone the Complaints Officer, Craig Wilford, on +61 2 9251 4600 and they will assist you in documenting your complaint. Written complaints are recorded, acknowledged within 5 days and investigated. As soon as practical, and not more than 45 days after receiving the written complaint, the response to your complaint will be advised in writing,

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External complaints resolution process If NCFS cannot resolve your complaint to your satisfaction within 45 days, you can refer the matter to the Financial Ombudsman Service (FOS). FOS 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 FOS are available at the FOS website www.fos.org.au or by contacting them directly at: Financial Ombudsman Service Limited GPO Box 3, Melbourne Victoria 3001 Telephone: 1300 56 55 62 Facsimile (03) 9613 6399 Email: [email protected] The Australian Securities and Investments Commission also has a free call infoline on 1300 300 630 which you may use to obtain information about your rights. Compensation arrangements NCFS has professional indemnity insurance cover as required by the Corporations Act 2001(Cth). Contact Details You may contact NCFS at: Nexia Financial Solutions Pty Ltd PO Box H195 Australia Square NSW 1215

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mailto:[email protected]�

21 July 2014 The Directors Dome Gold Mines Ltd Level 7, 71 Macquarie Street Sydney NSW 2000 Dear Sirs, Independent Expert’s Report on proposed acquisition of Magma Mines Ltd

1. INTRODUCTION

1.1 Background

On 10 June 2014, Dome Gold Mines Ltd (“Dome”) announced the proposed acquisition of Magma Mines Ltd (“Magma”), an unlisted Australian public company (“Proposed Transaction”). The consideration for the acquisition is shares in Dome whereby each Magma shareholder will receive one share in Dome for one share in Magma (“Consideration Shares”).

If the Proposed Transaction proceeds, on the issue of the Consideration Shares Magma’s shareholders will hold 87,117,198 of a total of 212,643,481 issued shares in Dome (excluding 10,148,395 options), an interest of 41.0%, with Onizaki Corporation being the largest shareholder with a 14.1% interest in the Combined Entity.

1.2 Purpose of Report

The purpose of this report is to advise the shareholders of Dome of the fairness and reasonableness of the Proposed Transaction.

Australian Securities Exchange (“ASX”) Listing rule 10.1 prohibits a listed entity from acquiring a substantial asset from, or disposing of a substantial asset to, an entity that is in a position of significant influence without the approval of its shareholders.

An entity that is in a position of significant influence specifically includes any related party to the listed entity and any substantial shareholder. A related party includes companies with common directors and a substantial shareholder includes a shareholder, and its associates, with a relevant interest in at least 10% of the issued voting shares in the listed entity. An asset is substantial if its value, or the consideration being paid, is 5% or more of the listed entity’s equity as set out in the accounts lodged with the ASX.

Tiger Ten Investment Limited and its associates hold 20,100,000 shares (16.0%) in Dome and 6,290,000 shares (7.2%) in Magma. Following the Proposed Transaction Tiger Ten Investment Limited and its associates will hold a 12.4% interest in the Combined Entity. These entities are associates of Tadao Tsubata, a director of Dome. Therefore, ASX Listing Rule 10.1 applies to the Proposed Transaction.

ASX Listing Rule 10.10.2, requires that a notice of meeting under Listing Rule 10.1 must be accompanied by an independent expert’s report stating whether in the expert’s opinion the transaction is fair and reasonable to the shareholders not associated with the transaction.

Consistent with the requirement under ASX Listing Rule 10.10.2 the directors of Dome have requested Nexia Court Financial Solutions Pty Ltd (“NCFS”) to prepare an independent expert’s report, the purpose of which is to provide an independent opinion as to whether or not the Proposed Transaction is fair and reasonable to the Non-Associated Shareholders.

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This report will accompany the Explanatory Memorandum sent to Dome’s shareholders in relation to the Proposed Transaction.

2. SUMMARY AND OPINION

This section is a summary of our opinion and cannot substitute for a complete reading of this Report. Our opinion is based solely on information available as at the date of this report.

The principal factors that we have considered in forming our opinion are summarised below.

2.1 Assessment of Fairness

In determining whether or not the transaction is fair we have considered the substance of the transaction for a Non-Associated Shareholder. Taking into account the requirements of ASIC Regulatory Guide 111 – Content of experts reports (“RG 111”); we consider that the fair value of the securities that Dome is offering to Magma shareholders is a minority interest in Dome. If the Proposed Transactions proceeds, the Non-Associated Shareholders will hold a minority interest in the Combined Entity.

To determine whether Non-Associated Shareholders are no worse off because of the transaction we have therefore considered their position before and after the Proposed Transaction on the above basis.

Details of our analysis of the valuation of each entity and the assessment of fairness are set out in sections 9 to 11 of our report.

The valuation methodology that we have applied in determining the fair value of both Dome and Magma is the realisation of net assets methodology. This reflects that the main value driver for each business is the value of the underlying tenements. We have also considered the price at which Dome’s shares have traded and recent share placement by both Dome and Magma to determine the reasonableness of the fair value on the net asset basis.

The fair value of a minority interest in Dome (the Non-Associated Shareholders position prior to the Proposed Transaction) compared to the fair value of a minority interest in the Combined Entity (the Non-Associated Shareholders position after the Proposed Transaction) is summarised below: $/share

Low Preferred High

Minority interest in Dome (see section 9.3)

$0.216 $0.242 $0.267

Minority interest in the Combined Entity (see section 11)

$0.225 $0.251 $0.277

The above valuation ranges are show graphically below:

As shown above, the fair value of a minority interest in the Combined Entity is higher than the fair value of a minority interest in Dome. Therefore, we have concluded that the Proposed Transaction is fair.

$0.15 $0.20 $0.25 $0.30

Fair value of Dome (minority interest)

Fair value of Combined Entity (minority interest)

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2.2 Assessment of reasonableness

In accordance with RG 111 the Proposed Transaction is reasonable if:

• The Proposed Transaction is fair; or

• Despite not being fair, but considering other significant factors, Non-Associated Shareholders should accept the Proposed Transaction.

In concluding that the Proposed Transaction is fair we have concluded that the Proposed Transaction is reasonable.

In forming our opinion we have also considered the following relevant factors (see section 13). Advantages

Disadvantages

• The Proposed Transaction is fair

• Acquisition of tenement with potential to generate cash flow in the short to medium term

• Opportunity to leverage Magma's Sigatoka asset and Dome's Nasivi Delta asset to provide greater returns

• Onizaki Corporation's shareholding reduced from 24.7% of Dome to 14.4% of the Combined Entity

• The ownership interest in a larger resources pool and potential to generate cash in the short to medium term should improve fundraising opportunities

• No special treatment of shareholders

• Magma has limited funding available to develop its tenements and therefore Dome's resources will be required to develop this site in preference to other tenements

• Initial development focus will be on the magnetite asset, the success of which will be affected by ongoing weakness in the price of iron ore

• Magma has borrowings of $2.7m that will be acquired under the Proposed Transaction. Repayment of the debt in December 2016 will be dependent on successful exploration and development or refinancing

If the Proposed Transaction does not proceed, Dome will continue exploration activity on its current tenements. There are no other alternatives to the Proposed Transaction.

2.3 Opinion

Accordingly, in our opinion, the Proposed Transaction is fair and reasonable for the Non-Associated Shareholders.

The ultimate decision however on whether to accept the Proposed Transaction should be based on Non-Associated Shareholders own assessment of their circumstances. We strongly recommend that Non-associated Shareholders consult their own professional advisers, carefully read all relevant documentation provided, including the Explanatory Memorandum, and consider their own specific circumstances before voting in favour of or against the Proposed Transaction. Yours faithfully Nexia Financial Solutions Limited (AFSL 247300)

Brent Goldman Authorised Representative

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STRUCTURE OF REPORT

Our Report is set out under the following headings: 3. OUTLINE OF PROPOSED TRANSACTION ....................................................................... 5

4. PURPOSE OF REPORT ..................................................................................................... 5

5. OVERVIEW OF DOME ....................................................................................................... 8

6. OVERVIEW OF MAGMA .................................................................................................. 13

7. INDUSTRY ANALYSIS ..................................................................................................... 16

8. VALUATION METHODOLOGIES ..................................................................................... 18

9. VALUE OF DOME ............................................................................................................ 20

10. VALUATION OF MAGMA ................................................................................................. 22

11. VALUATION OF A MINORITY INTEREST IN THE COMBINED ENTITY.......................... 24

12. ASSESSMENT OF FAIRNESS ......................................................................................... 24

13. ASSESSMENT OF REASONABLENESS ......................................................................... 25

14. OPINION........................................................................................................................... 27 APPENDICES

APPENDIX A – GLOSSARY AND DEFINITIONS .................................................................... 28

APPENDIX B - SOURCES OF INFORMATION ....................................................................... 29

APPENDIX C - STATEMENT OF DECLARATION & QUALIFICATIONS ................................. 30

APPENDIX D - VALUATION METHODOLOGIES .................................................................... 32

APPENDIX E – SUMMARY OF MINNELEX’S DOME VALUATION ......................................... 35

APPENDIX F – SUMMARY OF MINNELEX’S MAGMA VALUATION ...................................... 38

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3. OUTLINE OF PROPOSED TRANSACTION

On 10 June 2014, Dome Gold Mines Ltd (“Dome”) announced the proposed acquisition of Magma Mines Ltd (“Magma), an unlisted Australian public company (“Proposed Transaction”). The consideration for the acquisition is shares in Dome whereby each Magma shareholder will receive one share in Dome for one share in Magma (“Consideration Shares”).

If the Proposed Transaction proceeds, on the issue of the Consideration Shares Magma’s shareholders will hold 87,117,198 of a total of 212,643,481 issued shares in Dome (excluding 10,148,395 options), an interest of 41.0%, with Onizaki Corporation being the largest shareholder with a 14.1% interest in the Combined Entity.

Dome and Magma are related entities through the following relationships:

• Tiger Ten Investment Limited and its associates hold 20,100,000 shares (16.0%) in Dome and 6,290,000 shares (7.2%) in Magma. Following the Proposed Transaction Tiger Ten Investment Limited and its associates will hold a 12.4% interest in the Combined Entity. These entities are associates of Tadao Tsubata, a director of Dome.

• Allen Jay, a director of Dome, holds 250,000 shares in Magma.

• Andrew Skinner, a director of Dome, and his associates hold 4,000,000 shares in Magma.

The transaction is conditional upon:

• Dome shareholders approving the issue the Consideration Shares under the ASX Listing rules;

• no material adverse change, as determined by Dome, occurring prior to completion of the transaction;

• Magma not issuing any further shares, options or other rights to subscribe for shares in Magma;

• at least 90% of Magma’s shareholders approving the transaction;

• three directors nominated by Dome appointed to the board of Magma, effective upon completion; and

• all Magma directors resigning effective upon completion of the transaction.

4. PURPOSE OF REPORT

The purpose of this report is to advise the shareholders of Dome of the fairness and reasonableness of the Proposed Transaction.

Australian Securities Exchange (“ASX”) Listing rule 10.1 prohibits a listed entity from acquiring a substantial asset from, or disposing of a substantial asset to, an entity that is in a position of significant influence without the approval of its shareholders.

A entity that is in a position of significant influence specifically includes any related party to the listed entity and any substantial shareholder. A related party includes companies with common directors and a substantial shareholder includes a shareholder, and its associates, with a relevant interest in at least 10% of the issued voting shares in the listed entity. An asset is substantial if its value, or the consideration being paid, is 5% or more of the listed entity’s equity as set out in the accounts lodged with the ASX.

Due to Tiger Ten Investment Limited and associates holding more than 10% of the equity in Dome and the Proposed Transaction being more than 5% of Dome equity, ASX Listing Rule 10.1 applies to the Proposed Transaction.

ASX Listing Rule 10.10.2, requires that a notice of meeting under Listing Rule 10.1 must be accompanied by an independent expert’s report stating whether in the expert’s opinion the transaction is fair and reasonable to the shareholders not associated with the transaction.

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Consistent with the requirement under ASX Listing Rule 10.10.2 the Directors of Dome have requested Nexia Court Financial Solutions Pty Ltd (“NCFS”) to prepare an independent expert’s report, the purpose of which is to provide an independent opinion as to whether or not the Proposed Transaction is fair and reasonable to the Non-Associated Shareholders.

This report will accompany the Explanatory Memorandum sent to Dome’s shareholders in relation to the Proposed Transaction.

4.1 Basis of Evaluation

The ASX Listing Rules do not define the term fair and reasonable or provide direct guidance as to what should be considered for the purpose of ASX Listing Rule 10.1. The Australian Securities and Investment Commission (“ASIC”) has issued Regulatory Guide 111: Content of experts reports, which provides guidance as to matters that should be considered in determining whether a transaction is fair and reasonable in a range of circumstances.

RG 111 states that in deciding an appropriate form of analysis, the expert needs to consider that the main purpose of the report is to focus on the issues that could reasonably be anticipated by those persons affected by the transaction (ie the Non-Associated Shareholders). The focus should be on the purpose and outcome of the transaction, that is the substance of the transaction, rather than the legal mechanism used to effect the transaction.

A key consideration of the shareholders of a company entering into a transaction with a related party if whether they will be better or worse off as a result of the transaction. The main rationale of ASX Listing Rule 10 is to ensure that Non-Associated Shareholders are no worse off because of a substantial related party transaction.

In determining what is fair and reasonable for a related party transaction, RG 111 states that:

• an offer is fair if the value of the securities provided by the Company to the related party is equal to or less than the value of securities received by the Company; and

• an offer is reasonable if it is fair, or if the offer is not fair, the expert believes that there are sufficient reasons for security holders to accept the offer in the absence of a higher bid.

In determining whether the transaction is fair, the fair value is assumed to be based on a knowledgeable and willing, but not anxious, buyer and a knowledgeable and willing, but not anxious, seller acting at arm’s length.

In considering the substance of the Proposed Transaction, in determining whether the transaction is fair we have considered that the securities provided by Dome reflect a minority interest in Dome. Following the Proposed Transaction the benefit that will be received by Non-Associated Shareholders is a minority interest in the Combined Entity. Therefore for the purpose of determining whether or not the transaction is fair we have compared the fair value of a minority interest in Dome to the fair value of a minority interest in the Combined Entity.

In considering the fair value we have relied on reports prepared by Minnelex Pty Ltd ("Minnelex") in which the mineral assets of Dome and Magma have been valued. The directors of Dome and Magma, respectively engaged Minnelex to undertake the valuation and Minnelex and provided us with reliance on their valuation reports for the purposes of our Report and we have satisfied ourselves as to Minnelex’s competence and expertise. A copy of Minnelex’s summary valuation on Dome is attached in appendix E and a copy of Minnelex’s summary valuation on Magma is attached in appendix F. Full copies of the each of the valuation reports can be requested from Dome.

In our assessment of the reasonableness of the Proposed Transaction to the Non-Associated Shareholders, our consideration has included the following matters:

• the financial position and solvency;

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• opportunity costs;

• the alternatives available to the Company and the likelihood of those options occurring;

• the relative bargaining positions;

• whether there is selective treatment of any security holder (particularly related parties);

• any special value from the Proposed Transaction;

• the liquidity in Dome’s shares; and

• other significant matters set out in section 13.

4.2 Individual shareholders’ circumstances

The ultimate decision whether to accept the terms of Proposed Transaction should be based on each shareholder’s assessment of their own circumstances, including their risk profile, liquidity preference, tax position and expectations as to value and future market conditions. If in doubt about the Proposed Transaction or matters dealt with in this report, Non-Associated Shareholders should seek independent professional advice.

4.3 Limitations on Reliance on Information

The documents and information relied on for the purpose of this report are set out in Appendix B. We have considered and relied upon this information and believe that the information provided is reliable, complete and not misleading and we have no reason to believe that material facts have been withheld. The information provided was evaluated through analysis, enquiry and review for the purpose of forming an opinion as to whether the Proposed Transaction is fair and reasonable to the Non-Associated Shareholders. However, we do not warrant that our enquiries have identified or verified all of the matters which an audit or extensive examination might disclose.

We understand the accounting and other financial information that was provided to us has been prepared in accordance with generally accepted accounting principles.

An important part of the information used in forming an opinion of the kind expressed in this report is the opinions and judgement of management. This type of information has also been evaluated through analysis, enquiry and review to the extent practical. However, it must be recognised that such information is not always capable of external verification or validation.

NCFS are not the auditors of Dome or Magma. We have analysed and reviewed information provided by the Directors and management of Dome or Magma and made further enquiries where appropriate. Preparation of this report does not imply that we have in any way audited the accounts or records of Dome or Magma.

In forming our opinion we have assumed:

• Matters such as title, compliance with laws and regulations and contracts in place are in good standing and will remain so and that there are no material legal proceedings, other than as publicly disclosed;

• The information set out in the notice of meeting and explanatory memorandum to be sent by Dome to shareholders is complete, accurate and fairly represented in all material respect; and

• The publicly available information relied on by NCFS in its analysis was accurate and not misleading.

This report has been prepared after taking into consideration the current economic and market climate. We take no responsibility for events occurring after the date of this report which may impact upon this report or which may impact upon the assumptions referred to in the report.

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5. OVERVIEW OF DOME

5.1 Corporate History

Dome is a public, listed mineral exploration and development company headquartered in Sydney, Australia. The company was incorporated on 8 July 2011 and listed on the ASX on 22 October 2013 raising $1.042m from the issue of 5.21 million ordinary shares at an issue price of $0.20. Subsequent to the IPO issued 1,769,230 shares at $0.26 in May 2014, 1,923,077 shares at $0.26 on 7 July 2014 and 4,166,666 shares at $0.24 on 17 July 2014. As at 17 July 2014 Dome has on issue 125,526,283 ordinary shares.

Dome is the parent company to wholly owned subsidiary Dome Mines Ltd, a company limited by shares and incorporated in Fiji.

5.2 Business Activities

Dome currently holds three exploration tenements in Fiji, namely SPL 1451 (Kadavu-Ono Islands Tenement), SPL 1452 (Nadrau Tenement) and SPL 1454 (Nasivi Delta Tenement). Each of these tenements is held 100% by Dome, through its subsidiary.

A summary of each tenement is set out below.

5.2.1 SPL 1454 Nasivi Delta

This tenement comprises of 12,510ha that covers much of the onshore and offshore parts of the sedimentary delta of the Nasivi River which is located approximately 8km downstream from the Emperor Gold Mine. This tenement will expire on 22 August 2016.

Previous exploration by Dome and others has indicated that the alluvial sediments of the Nasivi Delta may contain detrital gold, presumably derived from the Vatukoula (Emperor Mine) area, and magnetite, probably derived from volcanic terrain in the river’s catchment. The Nasivi tenement provides Dome with the potential for rapid and low cost advancement, with scope to generate cash flow by producing gold, magnetite and possibly other heavy mineral products from the alluvial materials of the delta.

Dome carried out sonic drilling on the site in November and December 2013, which is in addition to the 36 holes drilled onshore previously that intersected thick zones of sand containing magnetite and other heavy minerals.

Results from the above exploration indicate that the highest heavy mineral concentration and therefore largest amount of magnetite is present in the near-surface black sands at Nasivi. Soil sampled has confirmed the presence of gold within the dry land alluvial area of the Nasivi Delta, however only four of the two metre composite core samples taken have contained 0.1g/t Au or greater. Dome considers these results to be inconclusive as the coarse gravel beds where gold is likely to be most concentrated were not effectively sampled.

Dome has observed heavy minerals in the black sand deposits offshore at the Nasivi Delta and they appear to be more intensely concentrated then the results from the above drilling. The next stage of sonic drilling of offshore black sand deposits took place in early May 2014. Data collected from this work is expected to be used to produce a resource estimate later in 2014.

With appropriate resources available for an accelerated program of drilling, engineering, metallurgical, environmental and social impact studies, Dome hopes to have a full feasibility report within 2 years.

5.2.2 SPL 1451 Kadavu-Ono Islands

SPL 1451 is located in the southern part of Fiji and is separated into two blocks, one block is on the north side of Kadavu Island (“Gasele”) and the other covers most of the nearby and smaller Ono Island (“Ono”). The two blocks comprise of 4,440ha. This tenement expires on 22 August 2016.

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Based on interpretation of results recorded by previous explorers in the area, Dome identified a number of near surface epithermal gold-silver prospects, particularly on Ono, and recognised potential for deeper porphyry copper-gold mineralisation.

Further work undertaken by Dome on Ono Island has confirmed anomalous levels of gold, silver and other metals that are indicative of an epithermal gold-silver prospect. Detailed mapping is planned to locate and sample the source rocks responsible for the anomalies.

5.2.3 SPL 1452 Nadrau

The Nadrau project covers 42,570ha on the main island of Viti Levu, Fiji and the tenement expires on 26 August 2016. Dome has identified two major prospects within SPL 1452, namely Namoli-Wainivau, which is located on the western side of the tenement and Wainivalau on the eastern side.

Both prospects have potential for porphyry copper-gold deposits, which may be under some cover, although that cover itself is thought to be prospective for epithermal style gold-silver deposits.

Namoli-Wainivau Prospect

During 2011 to 2012, Dome completing an extensive sampling programme over the area, which identified two related areas of mineralisation. Firstly, a broad multi-element anomaly that has the geochemical signature of a porphyry copper system. The signature indicated that mineralisation may be a relatively shallow depths; however being a large system it may take several years of intensive exploration before a resource can be identified. The second area is a multi-element anomaly which controls the course of the Sigatoka River. The mineralisation is more likely to be located at near surface levels, and if so, has the opportunity for advancement to the definition of drilling stage.

Wainivalau Project

Work in the areas suggests the presence of a possibly mineralised intrusive system. Modelling suggests that any porphyry mineralisation in this system could be under significant cover. Dome considers this an attractive longer term target given the size and intensity of the system.

There is also the potential for near surface epithermal gold mineralisation within the license areas, which a more immediate prospect.

5.3 Directors and Key Management

Following is a diagram of the management structure of Dome Gold Mines Ltd Australia:

Garry Lowder Chairman of

the Board

Allen Jay Non-Executive

Director

Tadao Tsubata Non-Executive

Director

Andrew Skinner

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5.4 Financial Information

The Dome auditor’s reports for the years ending 30 June 2012 and 2013 each contained a paragraph on material uncertainty regarding the continuation of the Company as a going concern.

In the 30 June 2013 financial statements, it is disclosed that the ability of the Company to continue as a going concern is dependent on its ability to fund its on-going activities from future capital raisings. To the extent that fundraising is not achieved sufficient to meet its ongoing objective the Directors intend to reduce expenditure significantly.

Since 30 June 2013 Dome mines has raised $1,042,000 through its IPO in October 2013 and an additional $1,960,000 from the issue of new ordinary shares in May and July 2014.

5.4.1 Financial performance

Set out below is the audited consolidated profit and loss account of Dome for the years 30 June 2012, 2013 and the reviewed consolidated profit and loss account for the six months ended 31 December 2013:

FY2012

FY2013 HY2014

Other income¹ - 1,397 19,177 Employee benefits expenses (including directors fees) (148,000) (162,000) (78,000) Other expenses 2 (597,849) (953,710) (691,020) Operating loss (745,849) (1,114,313) (749,843) Finance costs (28,742) (60,113) (671) Loss on foreign exchange (23,164) (17,343) (389) Loss before tax (797,755) (1,191,769) (750,903) Income Tax - - - Loss after tax (797,755) (1,191,769) (750,903) Exchange difference on translating foreign controlled entities

1,779 24,007 5

Total comprehensive loss (795,976) (1,167,762) (750,898) Source: Dome 30 June 2012, 2013 audited financial statements and 31 December 2013 reviewed interim financial statements

(1) Other income is interest income on cash balances

(2) Other expenses include accounting and auditor’s fees, administration and consultants’ expenses, bank fees, computer and communications expenses, donations, insurance, IPO expenses, legal expenses, office expenses and travel expenses.

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5.4.2 Financial Position

Set out below is the audited consolidated balance sheets of Dome as at 30 June 2012 and 2013 and the reviewed consolidated balance sheet of Dome as at 31 December 2013. FY2012

FY2013 HY2014

CURRENT ASSETS Cash and cash equivalents 1 4,876 1,015,845 1,701,730 Trade and other receivables 116,769 45,714 57,320 Other current assets 11,701 6,455 150,000 133,346 1,068,014 1,909,050 NON-CURRENT ASSETS Property, plant & equipment 7,788 4,351 2,935 Deferred exploration and evaluation expenditure 377,561 822,977 1,149,759 Other assets 24,612 44,967 59,304 409,961 872,295 1,211,998 TOTAL ASSETS 543,307 1,940,309 3,121,048 CURRENT LIABILITIES Trade and other payables (69,908) (69,130) (66,042) Borrowings (1,260,743) (638,926) - (1,330,651) (708,056) (66,042) TOTAL LIABILITIES (1,330,651) (708,056) (66,042) NET ASSETS (787,344) 1,232,253 3,055,006 EQUITY Issued capital 3 8,632 3,195,991 5,769,642 Foreign exchange translation reserve 1,779 25,786 25,791 Accumulated losses (797,755) (1,989,524) (2,740,427) TOTAL EQUITY (787,344) 1,232,253 3,055,006 Source: Dome 30 June 2012, 2013 audited financial statements and 31 December 2013 reviewed interim financial statements

1. The cash position at 4 July 2014 was $1,843,337.

2. Since 31 December 2013 Dome has raised an additional $1,960,000 from the issue of new ordinary shares in May and July 2014.

3. In June 2014 $1.2m was recognised as a liability for funds received from shareholders to be settled through the issue of shares. Shares were issued in July 2014 in full settlement of this liability.

4. Dome Mines has carried forward tax losses of $1,588,022 at 30 June 2013 that are not recognised in the balance sheet.

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5.5 Capital Structure and Ownership

Dome’s issued capital as at 17 July 2014 comprised 125,526,283 fully paid ordinary shares and 10,148,395 options to subscribe for shares. The options issued are to purchase shares at 20 cents per share and will expire on 30 September 2015.

The top 10 shareholders, as at the 17 July 2014, hold 70.6% of the issued capital of Dome and are set out below: Shareholder Shareholding % Total Onizaki Corporation 30,000,000 23.9% Tiger Ten Investment Limited 20,090,000 16.0% Brave Top Enterprises Ltd 5,500,000 4.4% Cybersys Inc 5,500,000 4.4% Charvest Pty Ltd 5,025,000 4.0% Globe Street Investments Pty Ltd <FRG Super A/C> 5,000,000 4.0% Globe Street Investments Pty Ltd <Globe Street Investments A/C> 5,000,000 4.0% Kimcroft Trading Pty Ltd 5,000,000 4.0% Hadeon Valley Holdings Inc. 3,750,000 3.0% Hillside Meadows Ltd 3,750,000 3.0% Top ten shareholders 88,615,000 70.6% Other shareholders 36,911,283 29.4% Total shareholders 125,526,283 100.0% Source: Dome share register

Of the issued shares, 1,666,670 are on escrow until 31 July 2014 and 86,320,000 are on escrow until 22 October 2015.

5.6 Share price and volume trading analysis

The following chart provides a summary of the closing share price and trading volumes for Dome shares from admission to the ASX on 25 October 2013 to 9 June 2014, which was the last full trading day prior to the announcement of the Proposed Transaction.

Source: S&P Capital IQ

The chart above indicates that the closing share price of Dome has traded within a range of $0.21 and $0.30 over the eight months to 9 June 2014 (the last full trading day before the announcement). The

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volume of Dome shares that have been traded over the period has been consistently low and trading volumes are summarised in the table below.

Period prior to 9

June 2014 Share Price Low Share Price High Cumulative

volume traded Trading as a % of

current issued capital 1 day $0.30 $0.30 - 0.000% 1 week $0.27 $0.30 10,000 0.017% 1 month $0.27 $0.30 40,000 0.034% 6 months $0.27 $0.30 234,305 0.199% From IPO $0.21 $0.30 327,149 0.278% Source: S&P Capital IQ and NCFS analysis

The table indicates that Dome’s shares listed on the ASX display a low level of liquidity, with only 0.278% of Dome’s capital being traded in since the IPO.

6. OVERVIEW OF MAGMA

6.1 Corporate History

Magma Mines Ltd is an unlisted public iron ore exploration and development company which was incorporated on 22 August 2011. Magma is based in Sydney, Australia and is the parent company of 100% owned Fijian subsidiary Magma Mines Ltd (Fiji).

6.2 Business Activities

Magma, through its subsidiary, holds a 100% interest in exploration tenement SPL 1495, which is located on the Coral Coast of the main Fiji island of Viti Levu. The tenement was granted to Magma on 13 February 2012 for an initial three year period. The tenement is in the area near the town of Sigatoka on the plains at the mouth of the Sigatoka River where alluvial deposits enriched in magnetite and other heavy minerals have accumulated. The tenement covers an area of 2,523ha.

It is estimated that as much as 500 million to 1 billion tonnes of mineralised sand are present at Sigatoka as evident from initial drill testing and aerial extent. A sonic drilling program of 43 holes was undertaken on the inland sand deposits during 2012 which showed an average heavy mineral content of 15.8%. This exploration was considered incomplete as some holes did not reach bedrock where sand deposits exceeded 36-40 metres in depth.

Magma undertook a second phase of sonic drilling in January 2014. This phase totalled 80 holes and to date the 32 holes have been analysed with early results showing strong magnetite concentrations in the river bed.

The Sigatoka iron sand mineralisation is easily accessible and mining is expected to employ low cost dredging methods commonly used in the mineral sand mining industry. Results to date indicate that the Sigatoka iron sand deposit has a high probability of containing commercial concentrations of magnetite and possibly other heavy minerals and it is reasonable to expect that a large and economically exploitable magnetite/heavy mineral sand deposit can be defined during 2014.

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6.3 Directors and Key Management

6.4 Financial Information

Magma’s auditors’ reports for the years ending 30 June 2012 and 2013 have each contained a paragraph on material uncertainty regarding the continuation of the Company as a going concern.

In the 30 June 2013 financial statements, it is disclosed that the ability of the Company to continue as a going concern is dependent on its ability to fund its on-going activities from future capital raisings. To the extent that fundraising is not achieved sufficient to meet its ongoing objective the Directors intend to reduce expenditure significantly. Since that date an additional 3,938,778 shares were issued to raise $1,187,499.

6.4.1 Financial performance

Set out below is the audited consolidated profit and loss account of Magma Mines Ltd for the years ended 30 June 2012, 2013 and the reviewed consolidated profit and loss account for the six months ended 31 December 2013:

FY2012

FY2013 HY2014

Other income 1 21 46,074 83,443 Depreciation (27,004) (59,906) (28,062) Employee benefits expenses (including directors fees) Board expenses

(40,500) (70,000) (50,500)

Other expenses 2 (395,596) (945,127) (468,703) Operating Loss (463,079) (1,028,959) (463,822) Finance costs (36,640) (98,934) (60,950) Gain/(loss) on foreign exchange (53,324) 52,480 12,889 Loss before income tax expense (553,043) (1,075,413) (511,883) Income tax expense - - - Loss for the period (553,043) (1,075,413) (511,883) Other comprehensive income for the period - - - Exchange difference on translating foreign controlled entities

193 5,936 4,076

Total comprehensive loss for the period (552,850) (1,069,477) (507,807) Source: Magma 30 June 2012, 2013 audited financial statements and 31 December 2013 reviewed interim financial statements

(1) Other income is primarily rental income from an operating leased sonic drill.

(2) Other expenses include accounting and auditor’s fees, administration and consultants’ expenses, bank fees, computer and communications expenses, donations, insurance, IPO expenses, legal expenses, office expenses and travel expenses.

John McCarthy Chairman of the Board

Ian Bell Non-Excutive Director

Sarah Harvey Non-Excutive Director

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6.4.2 Financial Position

Set out below is the audited consolidated balance sheets of Magma at 30 June 2012 and 2013 and the reviewed consolidated balance sheet of Magma as at 31 December 2013. FY2012

FY2013 HY2014

CURRENT ASSETS Cash and cash equivalents 1 59,384 26,805 76,499 Trade and other receivables 169,280 160,467 153,209 Other assets 3,728 922 10,265 232,392 188,194 239,973 NON-CURRENT ASSETS Property, plant and equipment 593,994 599,794 556,426 Deferred exploration and evaluation expenditure 376,245 1,183,672 1,468,221 Other Assets 22,293 25,579 25,725 992,532 1,809,045 2,050,372 TOTAL ASSETS 1,224,924 1,997,239 2,290,345 CURRENT LIABILITIES Trade and other payables (58,028) (34,591) (393,555) (58,028) (34,591) (393,555) NON-CURRENT LIABILITIES Borrowings 2 (1,711,637) (2,741,498) (2,583,447) (1,711,637) (2,741,498) (2,583,447) TOTAL LIABILITIES (1,769,665) (2,776,089) (2,977,002) NET ASSETS (544,741) (778,850) (686,657) EQUITY Issued Capital 4 8,109 843,477 1,443,447 foreign currency translation reserve 193 6,129 10,205 Accumulated losses (553,043) (1,628,456) (2,140,339) TOTAL EQUITY (544,741) (778,850) (686,657) Source: Magma 30 June 2012, 2013 audited financial statements and 31 December 2013 reviewed interim financial statements

1. The cash position at 3 July 2014 was $94,593.

2. All of Magma's borrowings expire at 31 December 2016 and incur a 5% interest rate. The majority ($1.7m) is owed to a third party, Luxury Resources. The remainder is owed to Tiger Ten Investments ($0.3m) and Charvest Limited ($0.6m).

3. Magma Mines has carried forward tax losses of $1,373,431 at 30 June 2013 that are not recognised in the balance sheet.

4. Since 31 December 2013, an additional 2,438,778 shares have been issued to raise $587,499.

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6.5 Capital Structure and Ownership

Magma’s issued capital as at 9 July 2014 comprised 87,117,198 fully paid ordinary shares.

The top 10 shareholders, as at 9 July 2014, hold 88.7% of the issued capital of Magma Mines Ltd and are set out below: Shareholder

Shareholding % Total

Long-Last Enterprises Ltd 16,000,000 18.4% Hillside Meadows Ltd 15,000,000 17.2% Summerfell Investments Ltd 14,000,000 16.1% Tiger Ten Investment Limited 6,260,000 7.2% Hadeon Valley Holdings Inc. (Hong Kong) Limited 6,250,000 7.2% Globe Street Investments Pty Ltd <FRG Super A/C> 5,000,000 5.7% Globe Street Investments Pty Ltd <Globe Street Investments A/C> 5,000,000 5.7% Kimcroft Trading Pty Ltd 5,000,000 5.7% Thamadia Nominees Pty Ltd (A/C Jean White Superannuation Fund) 2,500,000 2.9% Charvest Pty Ltd 2,250,000 2.6% Top ten shareholders 77,260,000 88.7% Other shareholders 9,857,198 11.3% Total shareholders 87,117,198 100.0% Source: Magma share register

7. INDUSTRY ANALYSIS123

7.1 Gold

Gold is both a commodity and an international store of monetary value. During periods of weak economic growth and political turbulence the demand for gold increases as it is seen to be a safe haven investment. This is particularly evident on financial markets since gold is viewed as more resilient and less risky than world currencies. Demand for gold has an inverse relationship with global economic performance as when the global economy improves demand for gold and its value decreases. These trends were demonstrated during the global financial crisis with investors investing in gold due to the volatility on financial markets.

Gold production rose from 2012 to 2013 by 6% to 3,022 tonnes and is expected to increase by a further 1% in 2014 to 3,058 tonnes. The increased production is expected to come from China, Mongolia, Peru and the Democratic Republic of Congo. Production in 2015 is forecast to increase by 1.4% to 3,102 tonnes due to new mines in China and Mongolia reaching their full potential.

Global gold fabrication consumption is forecast to increase in 2015 by 2.1% to a total of 2,789 tonnes. This increase in consumption is primarily from China who over took India in 2013 as the world’s largest consumer of gold fabrication. China is also the world leader in the production of gold; however, they have increased their gold importation due to cheaper gold prices. Gold mining can have high production costs including high level of capital intensity expenditure and many associated indirect costs for exploration, royalties, overheads, marketing, native title laws and research & development. With these costs industry performance and profitability depends largely on movement in the world price of gold.

Average gold prices in 2014 were down 9% to US$1,295 from US$1,420 in 2013. It is expected that a minimal rebound will occur in 2015 with an increase of 1% to US$1,306. The increase is anticipated from the continued growth in jewellery purchases in key emerging markets. The desire for gold as an investment asset is expected to remain subdued as inflation in major economies is well contained and as general economic conditions are improving other assets will offer higher returns in the short term.

1 BREE 2014, Resources and Energy Quarterly, June Quarter 2014, BREE, Canberra, June 2014 2 IBISWorld Pty Ltd, Gold Ore Mining in Australia, March 2014 3 IBISWorld Pty Ltd, Iron Ore Mining in Australia, April 2014

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A major political shock to the global economy has the potential to cause large short-term fluctuations in the gold price. However, despite the political conflict in the Ukraine gold prices remained relatively unchanged for the year.

Below is the historical gold price movement for the past 5 years.

Source: S&P Capital IQ and NCFS analysis

7.2 Iron Ore

The demand for Iron Ore is influenced by the demand for its primary outputs, steel and iron. In recent times there has been a decrease in demand for the raw material which has in turn lowered its price. The average price for Iron ore in 2014 was US$123 per tonne and closed at US$94 per tonne on 30 June 2014. The average price is forecast to be US$97 a tonne in 2015 which is a 21% decrease on 2014.

Reduced demand from China the world’s largest consumer is due to lower residential and infrastructure development. In 2015 world steel consumption (a main driver of iron ore demand) is forecast to increase by around 2.7% as China’s construction activity and investment in infrastructure is expected to increase. The increase is also due to India increasing its consumption of iron ore products as they are the world’s second largest consumer.

Iron ore prices have been declining due to the reduction in demand from China, higher iron ore port stocks, low steel prices and a surge in the availability and supply from Australia. Although steel production is forecast to increase in China in 2015, the iron ore price is still expected to decrease as competition among iron ore exporters to sell their additional production is expected to intensify.

A less volatile price climate is expected over the next five years as demand will continue to grow steadily, however since supply is forecast to increase in large blocks a lower price is still anticipated on the world markets. China will remain the key to industry growth in the next five years as Chinese steel smelting companies will continue to require high iron ore volumes to meet demand.

Below is the historical iron ore price movement from May 2013.

US$ 800.00

US$ 1,000.00

US$ 1,200.00

US$ 1,400.00

US$ 1,600.00

US$ 1,800.00

US$ 2,000.00

7/1/

2009

9/1/

2009

11/2

/200

91/

3/20

103/

6/20

105/

7/20

107/

8/20

109/

8/20

1011

/9/2

010

1/10

/201

13/

13/2

011

5/14

/201

17/

15/2

011

9/15

/201

111

/16/

2011

1/17

/201

23/

19/2

012

5/20

/201

27/

21/2

012

9/21

/201

211

/22/

2012

1/23

/201

33/

26/2

013

5/27

/201

37/

28/2

013

9/28

/201

311

/29/

2013

1/30

/201

44/

2/20

146/

3/20

14

Gold (^GC) (COMEX)

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Source: S&P Capital IQ and NCFS analysis

8. VALUATION METHODOLOGIES

8.1 Definition of market value

In forming our opinion as to whether or not the Proposed Transaction is fair and reasonable to the Non-Associated Shareholders of Dome, we have assessed the value of the issued shares of Dome and Magma on a fair value basis. For a related party transaction RG 111 defines fair value as the amount:

“assuming a knowledgeable and willing, but not anxious, buyer and a knowledgeable and willing, but not anxious, seller acting at arm’s length...”

8.2 Selection of Methodology

RG 111 provides guidance on the valuation methods that an independent expert should consider. These methods include:

• the discounted cash flow method and the estimated realisable value of any surplus assets;

• the application of earnings multiples (appropriate to the business or industry in which the entity operates) to the estimated future maintainable earnings or cash flows of the entity, added to the estimated realisable value of any surplus assets;

• the amount that would be available for distribution to security holders on an orderly realisation of assets;

• the quoted price for listed securities, when there is a liquid and active market and allowing for the fact that the quoted price may not reflect their value, should 100% of the securities be available for sale;

• any recent genuine offers received by the target for the entire business, or any business units or assets as a basis for valuation of those business units or assets; and

• the amount that an alternative bidder might be willing to offer if all the securities in the target were available for purchase.

US$ 85.00

US$ 95.00

US$ 105.00

US$ 115.00

US$ 125.00

US$ 135.00

US$ 145.005/

13/2

013

7/14

/201

3

9/14

/201

3

11/1

5/20

13

1/16

/201

4

3/19

/201

4

5/20

/201

4

Iron Ore 62% FE (^IY) (NYMEX)

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Each methodology is appropriate in certain circumstances. The decision as to which methodology to apply generally depends on the nature of the asset being valued, the methodology most commonly applied in valuing such an asset and the availability of appropriate information.

Appendix D summarises different valuation methodologies available.

In determining the fair value of Dome and Magma we have applied the realisation of assets methodology for both entities and in respect of Dome the quoted market price. In determining the appropriate methodologies to apply we have considered the following:

• As exploration companies, there is no history of sustainable profitability. Therefore a capitalisation of earnings approach is not applicable for either entity.

• The main value of each entity is the interest in the underlying exploration tenements. Therefore, the realisation of assets is an appropriate methodology for both entities. We note that the realisation of assets is a commonly applied methodology for exploration companies.

• Although Dome is listed, the shares are thinly traded with only 0.278% of shares traded since IPO. However, we have considered the traded share price as a secondary valuation methodology in respect of Dome.

• Both Dome and Magma have recently (within the last 12 months) placed shares. We have considered the price at which these shares have been placed in our assessment of fair value.

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9. VALUE OF DOME

9.1 Realisation of assets valuation of Dome shares prior to the Proposed Transaction

The fair value of Dome based on a realisation of assets is set out below: Notes

As at 31

December 2013

Low value Preferred value

High value

CURRENT ASSETS Cash and cash equivalents 1 1,701,730 1,843,337 1,843,337 1,843,337 Trade and other receivables 57,320 57,320 57,320 57,320 Other current assets 150,000 150,000 150,000 150,000 1,909,050 2,050,657 2,050,657 2,050,657 NON-CURRENT ASSETS

Property, plant & equipment 2,935 2,935 2,935 2,935 Exploration and evaluation assets

2 1,149,759 31,900,000 35,900,000 39,900,000

Other assets 59,304 59,304 59,304 59,304 1,211,998 31,962,239 35,962,239 39,962,239

TOTAL ASSETS 3,121,048 34,012,896 38,012,896 42,012,896

CURRENT LIABILITIES Trade and other payables (66,042) (66,042) (66,042) (66,042)

(66,042) (66,042) (66,042) (66,042)

TOTAL LIABILITIES (66,042) (66,042) (66,042) (66,042)

NET ASSETS 3,055,006 33,946,854 37,946,854 41,946,854

Shares on Issue

125,526,283 125,526,283 125,526,283 Value per share

$0.270 $0.302 $0.334

Minority discount

20% 20% 20% Value per share on a minority basis

$0.216 $0.242 $0.267

1. As at 4 July 2014, Dome had cash balances of $1,843,337 after receipt of the proceeds from recent fundraising activity and net of expenditure since 31 December 2013.

2. We have received an independent valuation on its tenement prepared by Minnelex Pty Ltd. Minnelex. A summary of the valuation is included in appendix E. The tenement values are summarised below:

Location Low

$m Preferred

$m High

$m SPL 1454 - Nasivi 18.9 21.0 23.2

SPL 1452 - Nadrau 8.4 9.6 10.8

SPL 1451 - Vunisea 4.6 5.3 5.9

Totals 31.9 35.9 39.9

We have been advised by the Directors that there were no material changes in the consolidated statement of financial position since 31 December 2013 apart from those discussed above. We have assumed that apart from the adjustments made above that the fair market value of the assets at 31 December 2013 are the same as the carrying values.

The realisation of assets value reflects the value of a Dome share on a controlling basis. This reflects an interest where a shareholder has advantages such as the ability to exert influence over the strategic direction and cash flow of a company, amongst other things. As noted above, the consideration that is

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being given to acquire the shares in Magma is a minority interest in Dome; therefore, we have applied a minority discount to the above calculation. A minority discount is the inverse of a control premium which research has indicated can range from 20-30%. We have determined a 25% control premium, which equates to a 20% minority discount to be appropriate.

9.2 Quoted market price of Dome and recent placements

There has been a low volume of share trading in Dome since IPO. The table below summarises the low, high and volume weighted average price for interim periods prior to 9 June 2014, the last full trading day prior to the announcement of the Proposed Transaction. $/share Low High VWAP 1 day 0.300 0.300 0.300 1 week 0.270 0.300 0.300 1 month 0.270 0.300 0.284 6 Months 0.270 0.300 0.290 from IPO 0.210 0.300 0.291 Source: S&P Capital IQ and NCFS calculations

The traded prices represent a the share price for a minority interest in Dome. As can be seen from the table above, the VWAP has been reasonably consistent throughout the period.

On 20 May 2014, Dome announced the placement of 1,769,230 shares at $0.26/share. On 7 July 2014, it was further announced that 1,923,077 shares had been placed at $0.26/share. On 17 July 2014, 4,166,666 were placed at $0.24/share.

9.3 Conclusion on fair value of a minority interest in Dome

Based on the above analysis we have concluded that the realisable value of Dome’s assets to be the most appropriate determination of fair value. Therefore we have concluded that the fair value of a share in Dome on a minority basis to be:

Low

Preferred High

Net asset valuation of Dome (section 9.1) $33,946,854 $37,946,854 $41,946,854 Minority discount 20% 20% 20% Net assets on a minority basis $27,157,483 $30,357,483 $33,557,483 Shares on issue 125,526,283 125,526,283 125,526,283 Fair value of a Dome share on a minority basis $0.216 $0.242 $0.267

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10. VALUATION OF MAGMA

10.1 Realisation of assets valuation of Magma shares

The fair value of Magma based on a realisation of assets is set out below: Notes

As at 31

December 2013

Low value Preferred value

High value

CURRENT ASSETS Cash and cash equivalents 1 76,499 94,593 94,593 94,593 Trade and other receivables 153,209 153,209 153,209 153,209 Other assets 10,265 10,265 10,265 10,265 239,973 258,067 258,067 258,067 NON-CURRENT ASSETS

Property, plant and equipment 556,426 556,426 556,426 556,426 Exploration and evaluation assets

2 1,468,221 28,000,000 31,000,000 34,000,000

Other Assets 25,725 25,725 25,725 25,725 2,050,372 28,582,151 31,582,151 34,582,151

TOTAL ASSETS 2,290,345 28,840,218 31,840,218 34,840,218

CURRENT LIABILITIES Trade and other payables (393,555) (393,555) (393,555) (393,555)

(393,555) (393,555) (393,555) (393,555) NON-CURRENT LIABILITIES

Borrowings 3 (2,583,447) (2,704,275) (2,704,275) (2,704,275) (2,583,447) (2,704,275) (2,704,275) (2,704,275)

TOTAL LIABILITIES (2,977,002) (3,097,830) (3,097,830) (3,097,830)

NET ASSETS (686,657) 25,742,388 28,742,388 31,742,388

Shares on Issue 87,117,198 87,117,198 87,117,198 Value per share $0.295 $0.33 $0.364 Minority discount 20% 20% 20% Value per share on a minority basis

$0.236 $0.264 $0.291

1. As at 4 July 2014, Magma had cash balances of $94,593.

2. As at 30 June 2014, Magma had increased its borrowings from shareholders and had a total of $2.7m owing. These borrowings were from Luxury Investments ($2.4m) and Tiger Investments Limited ($0.3m).

3. We have received an independent valuation on its tenement prepared by Minnelex. A summary of the valuation is included in appendix F. In assessing the value, Minnelex applied different valuation techniques, the calculated values for each are summarised below. In determining the far value a one third reduction was applied to take into account the depressed market for iron ore. The reduction is consistent with the current iron price compared to historical levels.

Method Low

$m Preferred

$m High

$m Appraised 15.0 16.5 18.0 Comparative 30.0 34.0 38.0 NPV 80.0 90.0 100.0 Totals 125.0 140.5 156.0 Averaged 42.0 47.0 52.0 Depressed market 28.0 31.0 34.0

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We have been advised by the Directors that there were no material changes in the consolidated statement of financial position since 31 December 2013 apart from those discussed above. We have assumed that apart from the adjustments made above that the fair market value of the assets at 31 December 2013 are the same as the carrying values.

The realisation of assets value reflects the value of a Magma share on a controlling basis. This reflects an interest where a shareholder has advantages such as the ability to exert influence over the strategic direction and cash flow of a company, amongst other things. To determine the fair value of a minority interest in Magma, we have applied a minority discount of 20% consistent with Dome.

10.2 Place of shares Magma shares

Below is a summary of all the share issues from 1 July 2013: Date of Issue No. of Shares Issue Price Total Price

13-Aug-13 250,000 $0.40 $100,000 13-Aug-13 1,250,000 $0.40 $500,000 27-Jun-14 166,666 $0.20 $33,333 27-Jun-14 166,666 $0.20 $33,333 27-Jun-14 166,666 $0.20 $33,333 27-Jun-14 554,166 $0.24 $133,000 30-Jun-14 961,538 $0.26 $250,000 03-Jul-14 423,076 $0.247 $104,500 Total 3,938,778 $1,187,499

In respect to the above, we note that the shares issued in August 2013 at $0.40 were at a time when the market value of iron ore was significantly higher. Therefore, we do not consider this price to reflect the fair value of a Magma share. Shares issued in June and July 2014 are consistent with the fair value calculated in section 10.1.

10.3 Conclusion as to fair value of Magma share on a minority basis

Based on the above analysis we gave concluded that the realisable value of Magma’s assets to be the most appropriate determination of fair value. Therefore we have concluded that the fair value of a Magma share on a minority basis to be: Low

Preferred High

Net asset valuation of Magma (section 10.1) $25,742,388 $28,742,388 $31,742,388 Minority discount 20% 20% 20% Net assets on a minority basis $20,593,910 $22,993,910 $25,393,910 Shares on issue 87,117,198 87,117,198 87,117,198 Fair value of a Magma share on a minority basis $0.236 $0.264 $0.291

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11. VALUATION OF A MINORITY INTEREST IN THE COMBINED ENTITY

We have calculated a minority interest in the Combined Entity as following the Proposed Acquisition this reflects the final position of the Non-Associated Shareholders. In determining the value of the value of the Combined Entity we have calculated the fair value based on the sum of the parts. As noted above, we have determined that the realisable value of assets to be the most appropriate valuation methodology for both Dome and Magma.

As noted above, the realisable value of assets represents a controlling interest in the entity and therefore we have applied a minority discount of 20% to calculate the fair value of a minority interest.

The acquisition of Magma is to be undertaken through the issue of one share in Dome for one share in Magma.

Our calculation a minority interest is as follows: $

Low Preferred High

Net asset value of Dome (see section 9.1) $33,946,854 $37,946,854 $41,946,854 Net asset value of Magma (see section 10.1) $25,742,388 $28,742,388 $31,742,388 $59,689,242 $66,689,242 $73,689,242 Minority discount 20% 20% 20% Minority value of Combined Entity 47,751,394 53,351,394 58,951,394 Dome shares prior to Proposed Transaction 125,526,283 125,526,283 125,526,283 Consideration Shares 87,117,198 87,117,198 87,117,198 212,643,481 212,643,481 212,643,481 Fair value of share in Combined Entity $0.225 $0.251 $0.277

We have compared the value calculated above with trading in Dome shares subsequent to the announcement on 10 June 2014. Trading details and the VWAP from 10 June 2014 to 16 July 2014 are summarised below: Pricing Date

Price Volume

11/06/2014 $0.26 10,000 12/06/2014 $0.27 13,500 24/06/2014 $0.25 6,500 1/07/2014 $0.25 3,500 3/07/2014 $0.22 6,500 VWAP from 10 June 2014 to 14 July 2014 $0.25

The value at which trading took place is likely to be also impacted by the placement of shares at $0.26 in July 2014. However, we note that overall trading, although small is consistent with the valuation determined for the Combined Group above.

12. ASSESSMENT OF FAIRNESS

As discussed in section 4.1, in determining whether or not the transaction is fair we have considered the substance of the transaction for a Non-Associated Shareholder. Taking into account the requirements of RG 111, we consider that the fair value of the securities that Dome is offering to Magma shareholders is a minority interest in Dome. As consideration, Dome’s Non-Associated Shareholders receive a minority interest in the Combined Group.

To determine whether Non-Associated Shareholders are no worse off because of the transaction we have therefore considered their position before and after the Proposed Transaction on the above basis.

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The fair value of a minority interest in Dome (the Non-Associated Shareholders position prior to the Proposed Transaction) compared to the fair value of a minority interest in the Combined Entity (the Non-Associated Shareholders position after the Proposed Transaction) is summarised below: $/share

Low Preferred High

Minority interest in Dome (see section 9.3)

$0.216 $0.242 $0.267

Minority interest in the Combined Entity (see section 11)

$0.225 $0.251 $0.277

The above valuation ranges are show graphically below:

As shown above, the fair value of a minority interest in the Combined Entity is higher than the fair value of a minority interest in Dome. Therefore, we have concluded that the Proposed Transaction is fair.

13. ASSESSMENT OF REASONABLENESS

13.1 Approach to assessing Reasonableness

In forming our conclusions in this report, we have compared the advantages and disadvantages for Non-Associated Shareholders if the Proposed Transaction proceeds.

13.2 Advantages of the Proposed Transaction

We outline below potential advantages of the Proposed Transaction: Advantage Explanation Acquisition of tenement with potential to generate cash flow in the short to medium term

Magma's tenement is more developed that Dome tenements and the acquisition would provide Non-Associated shareholder with the potential to bring forward returns from a cash flow generating asset. Dome is currently conducting offshore testing of iron sand on its Nasivi Delta tenement and therefore has the equipment and technical expertise to advance Magma's Sigatoka project.

Opportunity to leverage Magma's Sigatoka asset and Dome's Nasivi Delta asset to provide greater returns

The proximity of each asset to the other and the alignment of mineral opportunity provides the opportunity to leverage infrastructure investment over a wider resource base improving the economic potential of both tenements. Further opportunities exist to improve the overall returns through utilising Dome's existing networks to market magnetite concentrates from Sigatoka as well as the opportunity to manage costs through back office synergies.

$0.15 $0.20 $0.25 $0.30

Fair value of Dome (minority interest)

Fair value of Combined Entity (minority interest)

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Onizaki Corporation's shareholding reduced from 23.9% of Dome to 14.1% of the Combined Entity

If the Proposed Transaction proceeds, Onizaki Corporation's interest in Dome will reduce from 23.9% to 14.1% in the Combined Entity. Although, Onizaki Corporation’s shareholding is still significant the level of influence that it will have over the Combined Entity is reduced.

The ownership interest in a larger resources pool and potential to generate cash in the short to medium term should improve fundraising opportunities

To further explore and develop all of the tenements, Dome is dependent on ongoing fundraising activity. Through the increase in exploration opportunities and in particular potential to generate cash flow sooner through the development of Magma's Sigatoka tenement, the potential for Dome to raise the capital required to fully develop its tenements should improve.

No special treatment of shareholders

All shareholders of Magma have been the treated equally and there has been no special treatment of related parties.

13.3 Disadvantages of the Proposed Transaction

We outline below potential disadvantages of the Proposed Transaction: Disadvantage Explanation Magma has limited funding available to develop its tenements and therefore Dome's resources will be required to develop this site in preference to other tenements

Magma has limited funding available. To develop the asset will require funding from the Combined Entity, which will divert activity from the exploration and development of existing assets.

Initial development focus will be on the magnetite asset, the success of which will be affected by ongoing weakness in the price of iron ore

On completion of the Proposed Transaction, the focus on development activity will be on the magnetite reserves of Dome's Navisi Delta and Magma's Sigatoka tenements. While these assets have the potential to generate cash flow the ultimate feasibility and returns will be impacted by potential movements in the iron ore price. As noted in section 7.2 weak iron ore prices are expected in the short term due to lower Chinese demand and over the medium term iron prices are expected to remain lower as large blocks of iron supply come on line.

Magma has borrowings of $2.7m that will be acquired under the Proposed Transaction. Repayment of the debt in December 2016 will be dependent on successful exploration and development or refinancing

On acquiring Magma, Dome will be acquiring $2.7m of debt. This debt expires on 31 December 2016 and incurs a 5% interest rate. Of this debt $0.3m is owed to Tiger Ten Investments and $2.4m to Charvest Pty Ltd. Shareholders and director related entities of Dome. The ability of the Combined Group to repay this debt is dependent on successful exploration and development of the tenements or otherwise will require refinancing in the future.

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13.4 Alternatives to the Proposed Transaction

The Directors have informed us that there are currently no other alternatives to the Proposed Transaction.

13.5 Implications of the Proposed Transaction not proceeding

If the Proposed Transaction does not proceed, Dome will continue exploration activities on its existing tenements.

13.6 Conclusion as to Reasonableness

ASIC Regulatory Guide 111 considers a Proposed Transaction to be reasonable if:

• The Proposed Transaction is fair; or

• Despite not being fair, but considering other significant factors, shareholders should obtain an overall benefit if the Proposed Transaction proceeds.

As the Proposed Transaction is fair and considering the advantages and disadvantages of the Proposed Transaction to the Non-Associated shareholders of the Proposed Transaction proceeding, we have concluded that the Proposed Transaction is reasonable.

14. OPINION

Accordingly, in our opinion, the Proposed Transaction is fair and reasonable for the Non-Associated Shareholders of Dome.

The ultimate decision however on whether to accept the Proposed Transaction should be based on Non-Associated Shareholders own assessment of their circumstances. We strongly recommend that the Non-Associated Shareholders consult their own professional advisers, carefully read all relevant documentation provided, including the Explanatory Memorandum, and consider their own specific circumstances before voting in favour of or against the Proposed Transaction.

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APPENDIX A – GLOSSARY AND DEFINITIONS Term

Definition

ASIC Australian Securities and Investments Commission

ASX Australian Securities Exchange

Au Gold

Combined Entity Dome after completion of Proposed Transaction

Company or Dome Dome Gold Mines Ltd (ACN 151 996 566)

Consideration Shares Dome shares issued to Magma shareholders as part of the Proposed Transaction

Explanatory Memorandum Explanatory Memorandum attached to the Notice of Meeting

FY2012 The year ended 30 June 2012 or as at that date

FY2013 The year ended 30 June 2013 or as at that date

Gasele One block of SPL 1451 on eastern Kadavu Island

Group Dome and its subsidiaries

Ha Hectare is a metric unit of area defined as 10,000 square metres

HY2014 The six months ended 31 December 2013 or as at that date

IPO Initial public offering

Magma Magma Mines Ltd (ACN 152 803 159)

Minnelex Minnelex Pty Ltd, independent valuer of the mining tenements

NCFS Nexia Court Financial Solutions Pty Ltd (AFSL 247300)

Non-Associated shareholder Shareholders of Dome that are not related to Magma under ASX Listing Rule 10 for the purposes of the Proposed Transaction

Notice of General Meeting Notice of meeting for 21 August 2014 to approve amongst other items the Proposed Acquisition

Ono One block of SPL 1451 which covers most of Ono Island

Proposed Transaction Proposed acquisition of Magma whereby Magma shareholders will receive one Dome share for every share held in magma

Report Independent Expert’s Report

RG 111 ASIC Regulatory Guide 111: Content of expert reports

VWAP Volume Weighted Average Price of shares

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APPENDIX B - SOURCES OF INFORMATION • APES 225 - Valuation Services • Australia Securities and Investment Commission’s (ASIC) database • Bureau of resources and Energy Economics ‘Resources and Energy Quarterly – June Quarter 2014’ • Dome activities report to the ASX for quarters ended 31 December 2013 and 31 March 2014 • Dome announcement to the ASX on 19 May 2014 and 3 July 2014 for Share Placements • Dome audited financial statement for years ended 30 June 2012 and 30 June 2013 • Dome unaudited management accounts year ended 30 June 2014 • Dome’s draft offer to all shareholders of Magma Mines Limited’ • Dome reviewed financial statements for the half year ended 31 December 2013 • Dome share registry details • IBISWorld Industry Report B0804 ‘Gold Ore Mining in Australia’ • IBISWorld Industry Report B0801 ‘Iron Ore Mining in Australia’ • Magma audited financial statement for years ended 30 June 2012 and 30 June 2013 • Magma reviewed financial statements for the half year ended 31 December 2013 • Magma unaudited management accounts for the years ended 30 June 2014 • Magma share registry details • Minnelex Pty Ltd. Geological Consulting Services & Valuations ‘Independent Valuation of Magma

Mines Ltd tenements dated 28 May 2014 • Minnelex Pty Ltd. Geological Consulting Services & Valuations ‘Independent Valuation of Dome Gold

Mines Ltd tenements dated 10 July 2014 • Regulatory Guide 111: Content of expert reports • Regulatory Guide 112: Independence of expert’s reports • S&P Capital IQ • Various company bank statements for both Domes Gold Mines and Magma Mines

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APPENDIX C - STATEMENT OF DECLARATION & QUALIFICATIONS Confirmation of Independence Prior to accepting this engagement Nexia Court Financial Solutions Pty Ltd (“NCFS”) determined its independence with respect to Dome, and Magma with reference to ASIC Regulatory Guide 112: Independence of expert’s reports (“RG 112”). NCFS considers that it meets the requirements of RG 112 and that it is independent of Dome and Magma. Also, in accordance with s648 (2) of the Corporations Act we confirm we are not aware of any business relationship or financial interest of a material nature with Dome or Magma, its related parties or associates that would compromise our impartiality. Mr Brent Goldman, authorised representative of Nexia Court Financial Solutions Pty Ltd, has prepared this report. Neither he nor any related entities of Nexia Court Financial Solutions Pty Ltd have any interest in the promotion of the Proposed Acquisition nor will Nexia Court Financial Solutions Pty Ltd receive any benefits, other than normal professional fees, directly or indirectly, for or in connection with the preparation of this report. Our fee is not contingent upon the success or failure of the Proposed Acquisition, and has been calculated with reference to time spent on the engagement at normal professional fee rates for work of this type. Accordingly, NCFS does not have any pecuniary interests that could reasonably be regarded as being capable of affecting our ability to give an unbiased opinion under this engagement. NCFS provided a draft copy of this report to the Directors and management of Dome for their comment as to factual accuracy, as opposed to opinions, which are the responsibility of NCFS alone. Changes made to this report, as a result of the review by the Directors and management of Dome have not changed the methodology or conclusions reached by NCFS. Reliance on Information The statements and opinions given in this report are given in good faith and in the belief that such statements and opinions are not false or misleading. In the preparation of this report NCFS has relied upon information provided on the basis it was reliable and accurate. NCFS has no reason to believe that any information supplied to it was false or that any material information (that a reasonable person would expect to be disclosed) has been withheld from it. NCFS evaluated the information provided to it by Dome and Magma as well as other parties, through enquiry, analysis and review, and nothing has come to its attention to indicate the information provided was materially mis-stated or would not afford reasonable grounds upon which to base its report. Accordingly, we have taken no further steps to verify the accuracy, completeness or fairness of the data provided. Our procedures and enquiries do not include verification work, nor constitute an audit or review in accordance with Australian Auditing Standards (AUS). NCFS does not imply and it should not be construed that it has audited or in any way verified any of the information provided to it, or that its enquiries could have verified any matter which a more extensive examination might disclose. The sources of information that we relied upon are outlined in Appendix I of this report. Qualifications NCFS carries on business at Level 16, 1 Market Street, Sydney NSW 2000. NCFS holds Australian Financial Services Licence No 247300 authorising it to provide financial product advice on securities to retail clients. NCFS’s representatives are therefore qualified to provide this report.

Brent Goldman specifically was involved in the preparing and reviewing this report. Brent Goldman is a Fellow of the Institute of Chartered Accountants in Australia and New Zealand and a Fellow of the Financial Services Institute of Australasia. He has over 15 years of corporate finance experience in both Australia and the UK.

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Consent and Disclaimers The preparation of this report has been undertaken at the request of the directors of Dome. It also has regard to relevant ASIC Regulatory Guides. It is not intended that the report should be used for any other purpose than to accompany the Notice of General Meeting to be sent to Dome shareholders. In particular, it is not intended that this report should be used for any purpose other than as an expression of NCFS’s opinion as to whether or not the Proposed Transaction is fair and reasonable and in the best interests of Dome shareholders. NCFS consent to the issue of this report in the form and context in which it is included in the Notice of General Meeting to be sent to Dome shareholders. Shareholders should read all documents issued by Dome that consider the Proposed Transaction its entirety, prior to proceeding with a decision. NCFS had no involvement in the preparation of these documents, with the exception of our report. This report has been prepared specifically for the non-associated shareholders of Dome. Neither NCFS, nor any member or employee thereof undertakes responsibility to any person, other than a non-associated shareholder of Dome, in respect of this report, including any errors or omissions howsoever caused. This report is "General Advice" and does not take into account any person's particular investment objectives, financial situation and particular needs. Before making an investment decision based on this advice, you should consider, with or without the assistance of a securities advisor, whether it is appropriate to your particular investment needs, objectives and financial circumstances. Our procedures and enquiries do not include verification work, nor constitute an audit or review in accordance with Australian Auditing Standards (AUS). Our opinions are based on economic, market and other conditions prevailing at the date of this report. Such conditions can change significantly over relatively short periods of time. Furthermore, financial markets have been particularly volatile in recent times. Accordingly, if circumstances change significantly, subsequent to the issue of the report, our conclusions and opinions may differ from those stated herein. There is no requirement for NCFS to update this report for information that may become available subsequent to its date.

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APPENDIX D - VALUATION METHODOLOGIES

In preparing this report we have considered valuation methods commonly used in practice and those recommended by RG 111. These methods include:

• the discounted cash flow method;

• the capitalisation of earnings method;

• asset based methods; and

• analysis of share market trading.

The selection of an appropriate valuation method to estimate Fair Market Value should be guided by the actual practices adopted by potential acquirers of the company involved.

Discounted Cash Flow Method

Description

Of the various methods noted above, the discounted cash flow method has the strongest theoretical standing. It is also widely used in practice by corporate acquirers and company analysts. The discounted cash flow method estimates the value of a business by discounting expected future cash flows to a present value using an appropriate discount rate. A discounted cash flow valuation requires:

• a forecast of expected future cash flows;

• an appropriate discount rate; and

• an estimate of terminal value.

It is necessary to project cash flows over a suitable period of time (generally regarded as being at least five years) to arrive at the net cash flow in each period. For a finite life project or asset this would need to be done for the life of the project. This can be a difficult exercise requiring a significant number of assumptions such as revenue growth, future margins, capital expenditure requirements, working capital movements and taxation.

The discount rate used represents the risk of achieving the projected future cash flows and the time value of money. The projected future cash flows are then valued in current day terms using the discount rate selected.

A terminal value reflects the value of cash flows that will arise beyond the explicit forecast period. This is commonly estimated using either a constant growth assumption or a multiple of earnings (as described under capitalisation of future maintainable earnings below). This terminal value is then discounted to current day terms and added to the net present value of the forecast cash flows.

The discounted cash flow method is often sensitive to a number of key assumptions such as revenue growth, future margins, capital investment, terminal growth and the discount rate. All of these assumptions can be highly subjective sometimes leading to a valuation conclusion presented as a range that is too wide to be useful.

Use of the Discounted Cash Flow Method

A discounted cash flow approach is usually preferred when valuing:

• early stage companies or projects;

• limited life assets such as a mine or toll concession;

• companies where significant growth is expected in future cash flows; or

• projects with volatile earnings.

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It may also be preferred if other methods are not suitable, for example if there is a lack of reliable evidence to support a capitalisation of earnings approach. However, it may not be appropriate if reliable forecasts of cash flow are not available and cannot be determined.

Capitalisation of Earnings Method

Description

The capitalisation of earnings method is a commonly used valuation methodology that involves determining a future maintainable earnings figure for a business and multiplying that figure by an appropriate capitalisation multiple. This methodology is generally considered a short form of a discounted cash flow, where a single representative earnings figure is capitalised, rather than a stream of individual cash flows being discounted. The capitalisation of earnings methodology involves the determination of:

• a level of future maintainable earnings; and

• an appropriate capitalisation rate or multiple.

A multiple can be applied to any of the following measures of earnings:

Revenue – most commonly used for companies that do not make a positive EBITDA or as a cross-check of a valuation conclusion derived using another method.

EBITDA - most appropriate where depreciation distorts earnings, for example in a company that has a significant level of depreciating assets but little ongoing capital expenditure requirement.

EBIT - in most cases EBIT will be more reliable than EBITDA as it takes account of the capital intensity of the business.

NPAT - relevant in valuing businesses where interest is a major part of the overall earnings of the group (e.g. financial services businesses such as banks).

Multiples of EBITDA, EBITA and EBIT value the whole businesses, or its enterprise value irrespective of the gearing structure. NPAT (or P/E) values the equity of a business

The multiple selected to apply to maintainable earnings reflects expectations about future growth, risk and the time value of money all wrapped up in a single number. Multiples can be derived from three main sources.

Using the guideline public company method, market multiples are derived from the trading prices of stocks of companies that are engaged in the same or similar lines of business and that are actively traded on a free and open market, such as the ASX. The merger and acquisition method is a method whereby multiples are derived from transactions of significant interests in companies engaged in the same or similar lines of business. In Australia this has been called the comparable transaction methodology. It is also possible to build a multiple from first principles.

Use of the Capitalisation of Earnings Method

The capitalisation of earnings method is widely used in practice. It is particularly appropriate for valuing companies with a relatively stable historical earnings pattern which is expected to continue. This method is less appropriate for valuing companies or assets if:

• there are no suitable listed company or transaction benchmarks for comparison;

• the asset has a limited life;

• future earnings or cash flows are expected to be volatile; or

• there are negative earnings or the earnings of a business are insufficient to justify a value exceeding the value of the underlying net assets.

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Asset Based Methods

Description

Asset based valuation methods estimate the value of a company based on the realisable value of its net assets, less its liabilities. There are a number of asset based methods including:

• orderly realisation;

• liquidation value;

• net assets on a going concern basis;

• replacement cost; and

• reproduction cost.

The orderly realisation of assets method estimates Fair Market Value by determining the amount that would be distributed to shareholders, after payment of all liabilities including realisation costs and taxation charges that arise, assuming the company is wound up in an orderly manner. The liquidation method is similar to the orderly realisation of assets method except the liquidation method assumes the assets are sold in a shorter time frame.

Since wind up or liquidation of the company may not be contemplated, these methods in their strictest form may not necessarily be appropriate. The net assets on a going concern basis method estimates the market values of the net assets of a company but does not take account of realisation costs.

The asset / cost approach is generally used when the value of the business’ assets exceeds the present value of the cash flows expected to be derived from the ongoing business operations, or the nature of the business is to hold or invest in assets. It is important to note that the asset approach may still be the relevant approach even if an asset is making a profit. If an asset is making less than an economic rate of return and there is no realistic prospect of it making an economic return in the foreseeable future, an asset approach would be the most appropriate method.

Use of Asset Based Methods

An asset-based approach is a suitable valuation method when:

• an enterprise is loss making and is not expected to become profitable in the foreseeable future;

• assets are employed profitably but earn less than the cost of capital;

• a significant portion of the company’s assets are composed of liquid assets or other investments (such as marketable securities and real estate investments); or

• it is relatively easy to enter the industry (for example, small machine shops and retail establishments).

Asset based methods are not appropriate if:

• the ownership interest being valued is not a controlling interest, has no ability to cause the sale of the company’s assets and the major holders are not planning to sell the company’s assets; or

• a business has (or is expected to have) an adequate return on capital, such that the value of its future income stream exceeds the value of its assets.

Analysis of Share Trading

The most recent share trading history provides evidence of the Fair Market Value of the shares in a company where they are publicly traded in an informed and liquid market. There should also be some similarity between the size of the parcel of shares being valued and those being traded. Where a company’s shares are publicly traded then an analysis of recent trading prices should be considered, at least as a cross-check to other valuation methods.

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APPENDIX E – SUMMARY OF MINNELEX’S DOME VALUATION

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APPENDIX F – SUMMARY OF MINNELEX’S MAGMA VALUATION

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