Inter-Citic · 2012. 10. 5. · ARRANGEMENT involving INTER-CITIC MINERALS INC., WESTERN MINING...

ARRANGEMENT

involving

INTER-CITIC MINERALS INC.,

WESTERN MINING GROUP CO., LTD.

and

QING HAI MINING ACQUISITION CORP. an indirect wholly-owned subsidiary ofWESTERN MINING GROUP CO., LTD.

SPECIAL MEETING OF SHAREHOLDERS OF INTER-CITIC MINERALS INC.

TO BE HELD ON OCTOBER 29, 2012

NOTICE OF SPECIAL MEETING AND MANAGEMENT PROXY CIRCULAR

OCTOBER 3, 2012

These materials are important and require your immediate attention. They require holders of common shares of Inter-Citic Minerals Inc. to make important decisions. If you are in doubt as to how to make such decisions, please contact your financial, legal, tax or other professional advisors. If you have any questions or require more information with regard to the procedures for voting your common shares or completing your transmittal documentation, please contact Computershare Investor Services Inc. at 1-800-564-6253 (toll free within North America).

October 3, 2012

Dear Shareholder:

On behalf of the Board of Directors (the “Board”) of Inter-Citic Minerals Inc. (“Inter-Citic” or the “Company”), we would like to invite you to attend the special meeting of shareholders of Inter-Citic (the “Meeting”). The Meeting will be held as follows:

Date: October 29, 2012

Time: 9:00 a.m. (EDT)

Place: Offices of Miller Thomson LLP, 58th Floor, Scotia Plaza, 40 King Street West, Toronto, Ontario.

At the Meeting, you will be asked to approve an arrangement under the Canada Business Corporations Act (the “Arrangement”) that will result in the acquisition by Qing Hai Mining Acquisition Corp. (“Acquireco”), an indirect wholly-owned subsidiary of Western Mining Group Co., Ltd. (“Parent”), of all of the issued and outstanding common shares of Inter-Citic (“Company Shares”) for consideration of $2.05 per Company Share in cash, upon the terms and subject to the conditions of the arrangement agreement between Parent, Acquireco and Inter-Citic made as of August 24, 2012 (the “Arrangement Agreement”).

The Board, after careful consideration and having received financial and legal advice, and following the receipt of the opinion of its financial advisor as to the fairness, from a financial point of view, of the consideration to be received by shareholders of Inter-Citic pursuant to the Arrangement, and the unanimous recommendation of the special committee of the Board, comprised of independent directors (the “Special Committee”), has determined unanimously that it is in the best interests of Inter-Citic to enter into the Arrangement Agreement providing for the Arrangement, and has unanimously determined to recommend to the shareholders that they vote FOR the special resolution of shareholders approving the Arrangement (the “Arrangement Resolution”).

The Arrangement is the result of an extensive process undertaken by the Special Committee and the Board. For the Arrangement to proceed, the Arrangement Resolution must be approved by the shareholders of Inter-Citic. To become effective, the Arrangement Resolution must be approved by the affirmative vote of at least 662/3% of the votes cast by holders of Company Shares present in person or represented by proxy at the Meeting and entitled to vote at the Meeting. In addition, as the Arrangement constitutes a “business combination” pursuant to Multilateral Instrument 61-101 — Protection of Minority Security Holders in Special Transactions(“MI 61-101”), the Arrangement Resolution must also be approved by a simple majority of the votes cast at the Meeting, excluding the votes cast by any holders of Company Shares that are required to be excluded in order to obtain “minority approval” pursuant to MI 61-101. The Arrangement is also subject to the approval of the Ontario Superior Court of Justice, regulatory approvals in China and certain other conditions customary in transactions of this nature.

All of the directors and two senior officers of Inter-Citic have entered into voting support agreements with Parent pursuant to which they have agreed, subject to the terms of such agreements, to vote their Company Shares in favour of the Arrangement and any actions required in furtherance of the Arrangement.

The accompanying notice of special meeting of shareholders and management proxy circular of Inter-Citic dated October 3, 2012 describe the Arrangement and include certain other information (including the full text of the Arrangement Agreement) to assist you in considering how to vote on

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the Arrangement Resolution. You are urged to read all of this information carefully and in its entirety and, if you require assistance, to consult your financial, legal, tax or other professional advisor. You may also obtain more information about Inter-Citic on the SEDAR website maintained by the Canadian Securities Administrators at www.sedar.com.

Your vote is important regardless of how many Company Shares you own. We hope that you will be able to attend the Meeting. If you are a registered holder of Company Shares, whether or not you plan to attend the Meeting in person, please vote by completing the enclosed form of proxy (printed on blue paper) and returning it in the envelope provided for this purpose, or by following the procedures for internet, telephone or facsimile voting provided in the accompanying form of proxy, before 5:00 p.m. (EDT) on October 26, 2012 (or the date that is one business day immediately preceding the date set for any adjournment or postponement of the Meeting), Registered shareholders of Inter-Citic can submit their proxies to Inter-Citic (a) by delivering the completed proxy to Computershare Investor Services Inc., 9th Floor, 100 University Avenue, Toronto, Ontario M5J 2Y1; (b) over the internet by going to www.investorvote.com and following the instructions provided; (c) by telephone, by calling 1-866-732-VOTE (8683) (toll free within North America) and following the instructions provided; or (d) by facsimile to Inter-Citic, c/o Computershare Investor Services Inc., at 1-866-249-7775 (toll free within North America) or (416) 263-9524 (direct).

If you are a registered holder of Company Shares, we also encourage you to complete, sign, date and return the enclosed letter of transmittal (printed on green paper) to facilitate the prompt payment for your Company Shares if the Arrangement is completed.

If, like many shareholders, you hold your Company Shares through a broker, investment dealer, bank, trust company or other intermediary, you should follow the instructions provided by your intermediary to ensure that your vote is counted at the Meeting and you should arrange for your intermediary to complete the necessary transmittal documents to facilitate the prompt payment for your Company Shares if the Arrangement is completed.

You will be asked at the Meeting to make important decisions. If you are in doubt as to how to make these decisions, please contact your financial, legal, tax or other professional advisor. If you have any questions or require more information with regard to the procedures for voting or completing your transmittal documentation, please contact Computershare Investor Services Inc., Inter-Citic’s transfer agent and registrar and the depositary for the Arrangement, at 1-800-564-6253 (toll free within North America).

If the shareholders of Inter-Citic approve the Arrangement Resolution and all of the other conditions to the Arrangement are satisfied or, where permitted, waived, it is anticipated that the Arrangement will be completed in the fourth quarter of 2012.

On behalf of the Board, we would like to take this opportunity to thank you for the support you have shown as a shareholder of Inter-Citic as we prepare to take part in this important event in Inter-Citic’s history.

Yours very truly,

(signed) “James J. Moore”

James J. MoorePresident

NOTICE OF SPECIAL MEETING OF SHAREHOLDERS

NOTICE IS HEREBY GIVEN that a special meeting (the “Meeting”) of the holders (“Shareholders”) of common shares (“Company Shares”) in the capital of Inter-Citic Minerals Inc. (“Inter-Citic” or the “Company”) will be held on October 29, 2012, commencing at 9:00 a.m. (EDT) at Toronto, Ontario, for the following purposes:

1. to consider, pursuant to an interim order of the Ontario Superior Court of Justice (Commercial List) dated October 3, 2012, as the same may be amended (the “Interim Order”), and, if deemed advisable, to pass, with or without variation, a special resolution of Shareholders (the “Arrangement Resolution”), the full text of which is attached as Appendix A to the accompanying management proxy circular of Inter-Citic (the “Circular”), approving an arrangement (the “Arrangement”) under Section 192 of the Canada Business Corporations Act (the “CBCA”) involving, among other things, the acquisition by Qing Hai Mining Acquisition Corp. (“Acquireco”), an indirect wholly-owned subsidiary of Western Mining Group Co., Ltd. (“Parent”), of all of the issued and outstanding Company Shares for $2.05 in cash per Company Share, all as more particularly described in the Arrangement Agreement (as defined below).

2. to transact such further or other business as may properly be brought before the Meeting or at any adjournment or postponement thereof.

The full text of the arrangement agreement between Parent, Acquireco and Inter-Citic made as of August 24, 2012 (the “Arrangement Agreement”) providing for the Arrangement, the plan of arrangement to give effect to the Arrangement (the “Plan of Arrangement”) and the Interim Order, are attached to the Circular as Appendix B, Appendix C and Appendix F, respectively.

The Board of Directors of Inter-Citic unanimously recommends that Shareholders vote FOR the Arrangement Resolution. Shareholders of record as of 5:00 p.m. (EDT) onSeptember 25, 2012, the record date for the Meeting, are entitled to notice of, and to vote at, the Meeting or any adjournment(s) or postponement(s) thereof.

If you are a registered Shareholder, whether or not you plan to attend the Meeting in person, please vote by completing the enclosed form of proxy (printed on blue paper) and returning it in the envelope provided for this purpose, or by following the procedures for internet, telephone or facsimile voting provided in the accompanying Circular, before 5:00 p.m. (EDT) on October 26,2012 (or the date that is one business day immediately preceding the date set for any adjournment or postponement of the Meeting). Registered Shareholders can submit their proxies to Inter-Citic (a) by delivering the completed proxy to Computershare Investor Services Inc., 9th Floor, 100 University Avenue, Toronto, Ontario M5J 2Y1; (b) over the internet by going to www.investorvote.com and following the instructions provided; (c) by telephone, by calling 1-866-732-VOTE (8683) (toll free within North America) from a touch tone telephone and following the instructions provided; or (d) by facsimile to Inter-Citic, c/o Computershare Investor Services Inc., at 1-866-249-7775 (toll free within North America) or (416) 263-9524 (direct).

If you are a non-registered Shareholder, you must follow the instructions provided by your broker, investment dealer, bank, trust company or other intermediary to ensure that your vote is counted at the Meeting.

If you do not vote, or do not instruct your broker, investment dealer, bank, trust company or other intermediary how to vote, you will not be considered to be present in person or represented by proxy for the purpose of voting on the Arrangement Resolution. Company Shares represented by a properly executed proxy will be voted on any ballot that may be

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conducted at the Meeting in accordance with your instructions and, if you specify a choice with respect to any matter to be acted upon at the Meeting, your Company Shares will be voted accordingly. In the absence of instructions, your Company Shares will be voted FOR the Arrangement Resolution.

Pursuant to the Interim Order, registered Shareholders have been granted a right to dissent in respect of the Arrangement Resolution and, if the Arrangement becomes effective, to be paid an amount equal to the fair value of their Company Shares, in accordance with the CBCA, as modified and supplemented by the Interim Order. This right is described in the Circular. The dissent procedures are technical and require that a registered Shareholder who wishes to dissent must send to Inter-Citic: (a) at 60 Columbia Way, Suite 501, Markham, Ontario, L3R 0C9 or (b) by facsimile transmission to 905-479-6397, in either case to be received by Inter-Citicnot later than 5:00 p.m. (EDT) on Friday, October 26, 2012 (or the date that is one business day immediately preceding the date set for any adjournment or postponement of the Meeting), a written notice of objection to the Arrangement Resolution and must otherwise comply strictlywith the dissent procedures described in the Circular, and the CBCA, as modified and supplemented by the Interim Order. Failure to comply strictly with the dissent procedures may result in the loss or unavailability of the right to dissent. See “Dissenting Registered Shareholders’ Rights” in the Circular and Appendix G to the Circular. Non-registered Shareholders who wish to dissent should be aware that only registered Shareholders are entitled to dissent.

The Circular provides additional information relating to matters to be dealt with at the Meeting and is deemed to form part of this notice. Any adjourned or postponed meeting resulting from an adjournment or postponement of the Meeting will be held at a time and place to be specified either by Inter-Citic before the Meeting or by the chairman of the Meeting at the Meeting.

If you have any questions or require more information regarding the procedures for voting or completing your proxy or transmittal documentation, please contact Computershare Investor Services Inc., Inter-Citic’s transfer agent and registrar and the depositary for the Arrangement, at 1-800-564-6253 (toll free within North America).

DATED at Toronto, Ontario this 3rd day of October, 2012.

BY ORDER OF THE BOARD OF DIRECTORS



TABLE OF CONTENTS

NOTICE TO SHAREHOLDERS IN THE UNITED STATES ........................................................ 1

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS.................. 2

CURRENCY............................................................................................................................... 3

REFERENCE TO ADDITIONAL INFORMATION ....................................................................... 3

INFORMATION CONTAINED IN THIS CIRCULAR.................................................................... 3

INFORMATION PERTAINING TO PARENT AND ACQUIRECO................................................ 4

INFORMATION CONCERNING THE MEETING AND VOTING AT THE MEETING................... 4Management Solicitation of Proxies ................................................................................ 4Voting Securities, Record Date and Principal Holder of Voting Securities ....................... 4Voting By Registered Shareholders ................................................................................ 5Voting By Non-Registered Shareholders......................................................................... 7Questions ....................................................................................................................... 8

SUMMARY................................................................................................................................. 9Overview......................................................................................................................... 9The Parties ..................................................................................................................... 9Recommendation of the Special Committee ................................................................. 10Recommendation of the Directors................................................................................. 10Reasons for the Recommendations of the Special Committee and the Board............... 10Opinion of Standard Chartered ..................................................................................... 13Interests of Directors, Senior Officers and Others in the Arrangement .......................... 14Particulars of the Arrangement...................................................................................... 15Shareholder Approvals ................................................................................................. 15Arrangement Mechanics ............................................................................................... 16The Arrangement Agreement........................................................................................ 17Sources of Funds for the Arrangement ......................................................................... 21Voting Support Agreements .......................................................................................... 21Principal Legal Matters ................................................................................................. 21Certain Canadian Federal Income Tax Considerations ................................................. 22Dissenting Registered Shareholders’ Rights ................................................................. 22Risk Factors Related to the Arrangement ..................................................................... 23

THE ARRANGEMENT ............................................................................................................. 24Background to the Arrangement ................................................................................... 24Recommendation of the Special Committee ................................................................. 27Recommendation of the Directors................................................................................. 28Reasons for the Recommendations of the Special Committee and the Board............... 28Opinion of Standard Chartered ..................................................................................... 31Interests of Directors, Senior Officers and Others in the Arrangement .......................... 32Particulars of the Arrangement...................................................................................... 35Shareholder Approvals ................................................................................................. 36Arrangement Mechanics ............................................................................................... 36Sources of Funds for the Arrangement ......................................................................... 38

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Voting Support Agreements .......................................................................................... 38Expenses of the Arrangement....................................................................................... 39

THE ARRANGEMENT AGREEMENT ...................................................................................... 40Conditions Precedent to the Arrangement .................................................................... 40Representations and Warranties................................................................................... 42Covenants of Inter-Citic ................................................................................................ 43Covenants of Parent and Acquireco.............................................................................. 47Non-Solicitation Obligations of Inter-Citic ...................................................................... 48Superior Proposal ......................................................................................................... 49Parent’s Matching Right ................................................................................................ 50Termination................................................................................................................... 51Termination Fee, Break-Up Fee and Expenses ............................................................ 53Directors’ and Officers’ Insurance and Indemnification.................................................. 54Amendment .................................................................................................................. 55

PROCEDURES FOR SURRENDER OF SHARE CERTIFICATES AND PAYMENT OF CONSIDERATION ................................................................................................................... 55

Delivery Requirements.................................................................................................. 55Delivery of Consideration .............................................................................................. 57

PRINCIPAL LEGAL MATTERS ................................................................................................ 58Court Approval of the Arrangement and Completion of the Arrangement...................... 58Canadian Securities Law Considerations...................................................................... 59Regulatory Matters........................................................................................................ 62

INFORMATION CONCERNING INTER-CITIC ......................................................................... 63Price Range and Trading Volume Data......................................................................... 63Independent Auditors.................................................................................................... 63Risk Factors Related to Inter-Citic................................................................................. 63Indebtedness of Directors and Executive Officers......................................................... 64

INFORMATION CONCERNING PARENT AND ACQUIRECO ................................................. 64Parent ........................................................................................................................... 64Acquireco...................................................................................................................... 64Summary Description of Parent’s Business .................................................................. 64

CERTAIN CANADIAN FEDERAL INCOME TAX CONSIDERATIONS ..................................... 65General......................................................................................................................... 65Holders Resident in Canada ......................................................................................... 65Holders Not Resident in Canada................................................................................... 67

DISSENTING REGISTERED SHAREHOLDERS’ RIGHTS ...................................................... 68

RISK FACTORS RELATED TO THE ARRANGEMENT ........................................................... 71

OTHER INFORMATION AND MATTERS................................................................................. 71

DEPOSITARY .......................................................................................................................... 71

LEGAL MATTERS.................................................................................................................... 72

WHERE YOU CAN FIND MORE INFORMATION .................................................................... 72

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APPROVAL OF INTER-CITIC MINERALS INC. ....................................................................... 73

CONSENT OF STANDARD CHARTERED .............................................................................. 74

CONSENT OF MILLER THOMSON LLP.................................................................................. 75

GLOSSARY OF TERMS .......................................................................................................... 76

APPENDIX A – ARRANGEMENT RESOLUTION

APPENDIX B – ARRANGEMENT AGREEMENT

APPENDIX C – PLAN OF ARRANGEMENT

APPENDIX D – OPINION OF STANDARD CHARTERED

APPENDIX E – NOTICE OF APPLICATION FOR FINAL ORDER

APPENDIX F – INTERIM ORDER

APPENDIX G – SECTION 190 OF THE CANADA BUSINESS ACT

INTER-CITIC MINERALS INC.

MANAGEMENT PROXY CIRCULAR

This Circular is furnished in connection with the solicitation of proxies by and on behalf of the management of Inter-Citic. Proxies may also be solicited by Parent on behalf of the management of Inter-Citic. The accompanying form of proxy is for use at the Meeting and at any adjournment or postponement of the Meeting and for the purposes set forth in the accompanying Notice of Meeting. A glossary of certain terms used in this Circular can be found beginning on page 76 of this Circular.

NOTICE TO SHAREHOLDERS IN THE UNITED STATES

Inter-Citic is a corporation existing under the laws of Canada. The solicitation of proxies for the Meeting by means of this Circular is not subject to the proxy requirements of the United States Securities Exchange Act of 1934, as amended. Accordingly, the solicitations and transactions contemplated in this Circular are made in accordance with Canadian corporate and securities laws, and this Circular has been prepared solely in accordance with disclosure requirements applicable in Canada. Shareholders in the United States should be aware that such requirements are different from those of the United States applicable to proxy statements under the United States Securities Exchange Act of 1934, as amended. Specifically, information concerning the operations of Inter-Citic contained in this Circular has been prepared in accordance with Canadian disclosure standards, which are not comparable in all respects to United States disclosure standards. The financial statements of Inter-Citic have been prepared in accordance with IFRS or in accordance with Canadian GAAP, in each case as applicable for the periods to which such financial statements relate, and thus may not be comparable to financial statements of United States companies.

Shareholders of Inter-Citic who are resident in, or citizens of, the United States should be aware that the transactions described in this Circular may have tax consequences for them which may not be described herein.

The enforcement by investors of civil liabilities under the United States securities laws may be affected adversely by the fact that each of Inter-Citic and Acquireco exists and is organized under the laws of Canada, and that Parent exists and is organized under the laws of The People’s Republic of China, that some or all of their respective directors and senior officers and certain of the experts named in this Circular are not residents of the United States, and that all or a substantial portion of their respective assets are located outside the United States. As a result, it may be difficult or impossible for Shareholders in the United States to effect service of process within the United States upon certain of the directors or senior officers of Inter-Citic, Acquireco and Parent, or certain of the experts named herein, or to realize against them upon judgments of courts of the United States predicated upon civil liabilities under the federal securities laws of the United States or “blue sky” laws of any state within the United States. In addition, Shareholders should not assume that the courts of Canada would enforce (a) judgments of United States courts obtained in actions against such persons predicated upon civil liabilities under the federal securities laws of the United States or “blue sky” laws of any state within the United States, or (b) in original actions, liabilities against such persons predicated upon civil liabilities under the federal securities laws of the United States or “blue sky” laws of any state within the United States.

THIS CIRCULAR, THE TRANSACTIONS CONTEMPLATED BY THE ARRANGEMENT AND THE PLAN OF ARRANGEMENT HAVE NOT BEEN APPROVED OR DISAPPROVED BY ANY SECURITIES REGULATORY AUTHORITY, NOR HAS ANY SECURITIES REGULATORY

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AUTHORITY PASSED UPON THE FAIRNESS OR MERITS OF THESE TRANSACTIONS OR UPON THE ACCURACY OR ADEQUACY OF THE INFORMATION CONTAINED IN THIS CIRCULAR. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENCE.

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

This Circular, including the Appendices to this Circular, contain “forward-looking statements” and “forward-looking information” under applicable Securities Laws (collectively, the “forward-looking statements”) relating, but not limited to, the expected timetable for completing the Arrangement, satisfaction of conditions precedent to such completion, benefits and synergies of the Arrangement and any other statements regarding Inter-Citic’s expectations, intentions, plans and beliefs. Forward-looking statements can often be identified by forward-looking words such as “anticipate”, “believe”, “expect”, “goal”, “plan”, “intend”, “estimate”, “optimize”, “may”, “will” or similar words suggesting future outcomes or other expectations, intentions, plans, beliefs, objectives, assumptions or statements about future events or performance.

Shareholders are cautioned not to place undue reliance on forward-looking statements. By their nature, forward-looking statements involve numerous assumptions, known and unknown risks and uncertainties, of both a general and specific nature, that could cause actual results to differ materially from those suggested by the forward-looking statements or contribute to the possibility that predictions, forecasts or projections will prove to be materially inaccurate. In evaluating these statements, Shareholders should specifically consider various factors, including the risks outlined under the headings “Information Concerning Inter-Citic — Risk Factors Related to Inter-Citic” and “Risk Factors Related to the Arrangement” in this Circular and those incorporated by reference herein, which risks may cause actual results to differ materially from any forward-looking statement.

Assumptions upon which forward-looking statements related to the Arrangement are based include, without limitation, (a) that the Shareholders will approve the Arrangement Resolution in the manner required by the Interim Order; (b) that the Court will approve the Arrangement; (c) that the Regulatory Approvals required for completion of the Arrangement will be obtained; and (d) that all other conditions to the completion of the Arrangement will be satisfied or, where permitted, waived. Many of these assumptions are based on factors and events that are not within the control of Inter-Citic and may not prove to be correct.

Factors that could cause actual results of Inter-Citic to vary materially from results anticipated by such forward-looking statements include, but are not limited to, the Parties’ ability to consummate the Arrangement; the conditions to the completion of the Arrangement, including the receipt of Shareholder approvals, Court approval and Regulatory Approvals required for the Arrangement (which may not be obtained or may not be obtained on the terms expected or on the anticipated schedule); the Parties’ ability to meet expectations regarding the timing, completion and accounting and tax treatment of the Arrangement; and the other factors described in Inter-Citic’s annual information form for its fiscal year ended November 30, 2011, and its most recent annual and quarterly financial statements, all of which are available on the SEDAR website maintained by the Canadian Securities Administrators at www.sedar.com.

You are further cautioned that the list of forward-looking statements, risks and assumptions set forth or referred to above is not exhaustive. All forward-looking statements in this Circular, including the Appendices hereto, are qualified by these cautionary statements. Some of the risks, uncertainties and other factors which negatively affect the reliability of forward-looking statements are discussed in Inter-Citic’s public filings with the Canadian Securities Administrators. The statements in this Circular are made as of the date of this Circular and Inter-Citic does not undertake to publicly update or revise any forward-looking statement, whether as

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a result of new information, future events or otherwise, except to the extent expressly required by applicable Laws. In addition, Inter-Citic does not undertake any obligation to comment on analyses, expectations or statements made by third parties in respect of Inter-Citic, its financial or operating results, or its securities.

CURRENCY

Unless otherwise stated, all references in this Circular to sums of money areexpressed in, and all payments provided for herein shall be made in, Canadian dollars, identified by the “$” sign.

REFERENCE TO ADDITIONAL INFORMATION

You can obtain additional documents related to Inter-Citic without charge on SEDAR at www.sedar.com. You can also obtain documents related to Inter-Citic by requesting them from the Vice-President, Corporate Communications of Inter-Citic, at 60 Columbia Way, Suite 501, Markham, Ontario L3R 0C9 or via facsimile at (905) 479-6397.

INFORMATION CONTAINED IN THIS CIRCULAR

The information contained in this Circular is given as at October 3, 2012 except where otherwise noted.

No person has been authorized by Inter-Citic, Parent or Acquireco to give information or to make any representations in connection with the Arrangement other than those contained in this Circular and, if given or made, any such information or representations should not be relied upon in making a decision as to how to vote on the Arrangement Resolution or be considered to have been authorized by Inter-Citic.

This Circular does not constitute an offer to buy, or a solicitation of an offer to sell, any securities, or the solicitation of a proxy, by any person in any jurisdiction in which such an offer or solicitation is not authorized or in which the person making such an offer or solicitation is not qualified to do so or to any person to whom it is unlawful to make such an offer or solicitation. Any responsibility of Inter-Citic, Parent or Acquireco for any third party’s non-compliance with the laws in such jurisdiction is expressly disclaimed.

All summaries of the terms and conditions of, and all references to, the Arrangement, the Arrangement Agreement and the Voting Support Agreements in this Circular are qualified in their entirety by reference, in the case of the Arrangement, to the complete text of the Plan of Arrangement attached as Appendix C to this Circular, and in the case of the Arrangement Agreement, to the complete text of the Arrangement Agreement attached as Appendix B to this Circular, each of which has been filed on SEDAR at www.sedar.com, and in the case of the Voting Support Agreements, to the complete text of each of the Voting Support Agreements filed on SEDAR and available at www.sedar.com.

Shareholders should not construe the contents of this Circular as legal, tax or financial advice and should consult with their own professional advisors in considering the relevant legal, tax, financial or other matters contained in this Circular.

If you hold Company Shares through a broker, investment dealer, bank, trust company or other Intermediary, you should contact your Intermediary for instructions and assistance in voting.

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INFORMATION PERTAINING TO PARENT AND ACQUIRECO

Certain information pertaining to Parent, Acquireco and their affiliates, including, but not limited to, information under “Information Concerning Parent and Acquireco” in this Circular, has been furnished to Inter-Citic by Parent and by Parent on behalf of Acquireco. Inter-Citic and its Directors have relied upon this information without having made independent inquiries as to the accuracy or completeness thereof. Although Inter-Citic does not have any knowledge that would indicate that any such information is untrue or incomplete, neither Inter-Citic nor any of its Directors, senior officers or advisors assumes any responsibility for the accuracy or completeness of such information, nor for any failure by Parent or Acquireco to disclose events which may have occurred or which may affect the completeness or accuracy of such information but which is unknown to them.

INFORMATION CONCERNING THE MEETING AND VOTING AT THE MEETING

Management Solicitation of Proxies

This Circular is furnished in connection with the solicitation of proxies by or on behalf of the management of Inter-Citic for use at the Meeting or any adjournment or postponement thereof. Proxies may also be solicited by Parent on behalf of the management of Inter-Citic, The Meeting is to be held on October 29, 2012 at Toronto, Ontario commencing at 9:00 a.m. (EDT), for the purposes set out in the Notice of Meeting.

Inter-Citic has distributed copies of the Meeting Materials to both Registered Shareholders and Non-Registered Shareholders.

The enclosed proxy is being solicited by or on behalf of the management of Inter-Citic and the cost of such solicitation will be borne by Inter-Citic. It is expected that the solicitation of proxies will be primarily by mail. Proxies may also be solicited personally or by telephone by officers and employees of Inter-Citic and the Directors.

Voting Securities, Record Date and Principal Holder of Voting Securities

Inter-Citic is authorized to issue an unlimited number of Company Shares. As of 5:00 p.m. (EDT) on the record date for the Meeting, September 25, 2012, there were 117,573,645 Company Shares issued and outstanding. Each Company Share carries the right to one vote.

Only Shareholders of record as of the record date will be entitled to vote at the Meeting. In accordance with the provisions of the CBCA, Inter-Citic prepared a list of Shareholders on the record date. Each Shareholder named in the list will be entitled to vote Company Shares shown opposite his, her or its name on the list at the Meeting, on all matters that properly come before the Meeting.

To become effective, the Arrangement Resolution must be approved by the affirmative vote of at least 662/3% of the votes cast by Shareholders present in person or represented by proxy at the Meeting and entitled to vote at the Meeting. In addition, as the Arrangement constitutes a “business combination” pursuant to MI 61-101, the Arrangement Resolution must also be approved by a simple majority of the votes cast at the Meeting, excluding the votes cast by any holders of Company Shares that are required to be excluded in order to obtain “minority approval” pursuant to MI 61-101. See “Principal Legal Matters — Canadian Securities Law Considerations — Minority Approval” in this Circular.

To the knowledge of the Directors and senior officers of Inter-Citic, no person or company beneficially owns, or controls or directs, directly or indirectly, voting securities carrying 10% or

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more of the voting rights attached to any class of voting securities of Inter-Citic other than Zijin Mining that holds approximately 20,163,300 Company Shares, representing 17.15% of the outstanding Company Shares.

In discussions with Zijin Mining’s management, it has been indicated to management of Inter-Citic that Zijin Mining will not oppose the Arrangement.

As of the date of this Circular, the Directors and senior officers of Inter-Citic beneficially own, directly or indirectly, or exercise control or direction over, 1,012,385 Company Shares, which represent approximately 0.86% of the issued and outstanding Company Shares. All of such Directors and two senior officers entered into the Voting Support Agreements with Parent pursuant to which each of them agreed, subject to the terms thereof, to vote his or its Company Shares in favour of the Arrangement and any actions required in furtherance of the Arrangement. See “The Arrangement — Voting Support Agreements” in this Circular.

Voting By Registered Shareholders

The following instructions are for Registered Shareholders only. If you are a Non-Registered Shareholder, please see “Voting By Non-Registered Shareholders” below and follow your Intermediary’s instructions on how to vote your Company Shares.

A Registered Shareholder is a Shareholder whose share certificate bears the name of the Shareholder. If you are a Registered Shareholder, you can vote your Company Shares in person at the Meeting or by proxy.

Voting in Person

Registered Shareholders who attend the Meeting may vote Company Shares registered in their names on resolutions put before the Meeting, namely the Arrangement Resolution. To ensure your vote is counted, complete and return the accompanying form of proxy as soon as possible even if you plan to attend the Meeting in person. Even if you return a completed proxy, you can attend the Meeting and your vote can be taken and counted at the Meeting. Please register your attendance with the scrutineer, Computershare Investor Services Inc., upon arrival at the Meeting.

Voting by Proxy

If you do not wish to attend the Meeting or do not wish to vote in person by internet or by telephone, you may vote by proxy by properly completing a form of proxy (printed on bluepaper) and depositing it with the transfer agent, Computershare Investor Services Inc., (the “Transfer Agent”), no later than 5:00 p.m. (EDT) on October 26, 2012 (or the date that is onebusiness day immediately preceding the date set for any adjournment or postponement of the Meeting). A proxy is a document that authorizes another person to attend the Meeting and cast votes at the Meeting on behalf of a Registered Shareholder. If you are a Registered Shareholder, you can use the accompanying form of proxy or any other legal form of proxy.

Form of Proxy

The form of proxy accompanying this Circular confers discretionary authority upon the nominees named in the enclosed form of proxy with respect to amendments or variations of matters identified in the Notice of Meeting or other matters which may properly come before the Meeting.

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The persons named in the accompanying form of proxy are Directors of Inter-Citic. You may choose those individuals or any other person to act as your proxyholder for casting your votes for you at the Meeting. If you want to authorize a Director of Inter-Citic to act as your proxyholder, please leave the line near the top of the proxy form blank, as their names are pre-printed on the form. A Shareholder has the right to appoint a person, who need not be a Shareholder, to attend and act on the Shareholder’s behalf at the Meeting other than the persons named in the proxy as proxyholders. If you want to authorize another person as your proxyholder, fill in that person’s name in the blank space located near the top of the accompanying proxy form.

The securities represented by the proxy will be voted in accordance with the instructions of the Shareholder on any ballot. If you mark on the proxy how you want to vote on a particular matter (by checking “FOR” or “AGAINST”), your proxyholder must vote your Company Shares as instructed. If you do NOT mark on the proxy how you want to vote on a particular matter, your proxyholder is entitled to vote your Company Shares as he or she sees fit. If yourproxy does not specify how to vote on any particular matter, and if you have authorized aDirector of Inter-Citic to act as your proxyholder, your Company Shares will be voted at the Meeting FOR the Arrangement Resolution.

The completed proxy must be signed by the Registered Shareholder or such Shareholder’s attorney authorized in writing or, if the Registered Shareholder is a corporation, by an officer or attorney thereof, duly authorized. Instructions for using each of the voting methods are set out on the form of proxy.

Depositing a Proxy

To be valid, the form of proxy must be filled out, correctly signed (exactly in the manner in which the Registered Shareholder’s Company Shares are registered) and returned to the Toronto office of the Transfer Agent by delivering it by 5:00 p.m. (EDT) on October 26, 2012 (or the date that is one business day immediately preceding the date set for any adjournment or postponement of the Meeting) as follows:

(a) to Computershare Investor Services Inc., 9th Floor, 100 University Avenue, Toronto, Ontario M5J 2Y1;

(b) over the internet by going to www.investorvote.com and following the instructions provided;

(c) by telephone, by calling 1-866-732-VOTE (8683) (toll free within North America), from a touch tone telephone and following the instructions provided; or

(d) by facsimile to Inter-Citic, c/o Computershare Investor Services Inc., at 1-866-249-7775 (toll free within North America) or (416) 263-9524 (direct).

It is the responsibility of the Registered Shareholder appointing some other person to representhim, her or it to inform such person that the person has been so appointed.

Revoking a Proxy

If you want to revoke your proxy after you have completed and delivered it, another properly executed proxy bearing a later date should be completed and delivered by you as set out above under “Depositing a Proxy”, or you can deposit an instrument in writing executed by you or your attorney authorized in writing that is received: (a) at the registered office of Inter-Citic or the Transfer Agent by 9:00 a.m. (EDT) on October 26, 2012 (or the date that is the last business

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day immediately preceding the date set for any adjournment or postponement of the Meeting); (b) with the scrutineer of the Meeting, to the attention of the chairman of the Meeting, at or immediately prior to the commencement of the Meeting (or any adjournment or postponement of the Meeting); or (c) in any other manner permitted by law. Attendance at the Meeting without voting will not itself revoke a proxy. If the instrument of revocation is deposited with the chairman of the Meeting on the day of the Meeting, the instrument will not be effective with respect to any matter on which a vote has already been cast pursuant to such proxy. If you revoke your proxy and do not replace it with another proxy that is properly deposited, you may still vote Company Shares registered in your name in person at the Meeting.

Voting By Non-Registered Shareholders

Your Company Shares may not be registered in your name but in the name of an Intermediary, such as a broker, investment dealer, bank or trust company. If your Company Shares are held on your behalf, or for your account, by an Intermediary, you are a Non-Registered Shareholder (as opposed to a Registered Shareholder).

Pursuant to applicable Securities Laws, Inter-Citic has distributed copies of the Meeting Materials to CDS and Intermediaries for onward distribution to Non-Registered Shareholders. Intermediaries are required to forward the Meeting Materials to Non-Registered Shareholders unless a Non-Registered Shareholder has waived the right to receive them. Typically, Intermediaries will use a service company to forward the Meeting Materials to Non-Registered Shareholders.

Non-Registered Shareholders will ordinarily receive either a voting instruction form or, less frequently, a form of proxy. The purpose of these forms is to permit Non-Registered Shareholders to direct the voting, by their Intermediaries, of Company Shares that such Shareholders beneficially own but which are not registered in their own names. Non-Registered Shareholders should follow the procedures set out below, depending on which type of form they receive:

! Voting Instruction Form. In most cases, a Non-Registered Shareholder will receive, as part of the Meeting Materials, a voting instruction form. If the Non-Registered Shareholder does not wish to attend and vote at the Meeting in person (or have another person attend and vote on the holder’s behalf), the voting instruction form must be completed, signed and returned in accordance with the directions on the form. If a Non-Registered Shareholder wishes to attend and vote at the Meeting in person (or have another person attend and vote on the holder’s behalf), the Non-Registered Shareholder must complete, sign and return the voting instruction form in accordance with the directions provided;

or

! Form of Proxy. Less frequently, a Non-Registered Shareholder will receive, as part of the Meeting Materials, a form of proxy that has already been signed by the Intermediary (typically by a facsimile, stamped signature) and that is restricted as to the number of Company Shares beneficially owned by the Non-Registered Shareholder but which is otherwise uncompleted. If the Non-Registered Shareholder does not wish to attend and vote at the Meeting in person (or have another person attend and vote on the Non-Registered Shareholder’s behalf), the Non-Registered Shareholder must complete the proxy and return it to the Transfer Agent by delivering it as described above under the subheading “Depositing a Proxy”. If a Non-Registered Shareholder wishes to

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attend and vote at the Meeting in person (or have another person attend and vote on the holder’s behalf), the Non-Registered Shareholder must strike out the names of the persons named in the proxy and insert the Non-Registered Shareholder’s (or such other person’s) name in the blank space provided and return the proxy to the Transfer Agent by delivering it as described above under the subheading “Depositing a Proxy”.

Non-Registered Shareholders should follow the instructions on the forms they receive and contact their Intermediaries promptly if they need assistance.

Proxies returned by Intermediaries as “non-votes” because the Intermediary has not received instructions from the Non-Registered Shareholder with respect to the voting of Company Shares will be treated as not entitled to vote on any such matter and will not be counted as having been voted in respect of any such matter. Company Shares represented by Intermediary “non-votes” will not be counted in determining whether there is a quorum.

Questions

If you have any questions regarding the procedures for voting at the Meeting, please contact Computershare Investor Services Inc. at 1-800-564-6253 (toll free within North America).

SUMMARY

The following is a summary of information contained elsewhere in this Circular. This summary is provided for convenience only and should be read in conjunction with, and is qualified in its entirety by, the more detailed information appearing or referred to elsewhere in this Circular including the Appendices. Certain capitalized words and terms used in this summary and elsewhere in this Circular are defined in the Glossary of Terms, which can be found beginning on page 76 of this Circular.

Overview

Inter-Citic entered into the Arrangement Agreement with Parent and Acquireco on August 24, 2012. Pursuant to the Arrangement Agreement, Inter-Citic, Parent and Acquireco agreed to carry out the Arrangement in accordance with the Arrangement Agreement, a copy of which is attached as Appendix B to this Circular, and upon the terms set out in the Plan of Arrangement, a copy of which is attached as Appendix C to this Circular.

At the Meeting, Shareholders will be asked to vote on the Arrangement Resolution, as required by the Interim Order, in the form attached as Appendix A to this Circular. If Shareholders approve the Arrangement Resolution and all of the conditions precedent set out in the Arrangement Agreement are satisfied or, where permitted, waived, a series of transactions and steps will occur on the Effective Date under the Plan of Arrangement, as a result of which Acquireco will acquire all of Company Shares for $2.05 in cash per share.

The Parties

Inter-Citic Minerals Inc.

Inter-Citic is a corporation governed by the CBCA. Its head and registered office address is 60 Columbia Way, Suite 501, Markham, Ontario, L3R 0C9. Inter-Citic is a reporting issuer in British Columbia, Alberta, Manitoba and Ontario and files continuous disclosure documents on SEDAR. Company Shares trade on the TSX under the symbol “ICI”. For additional information regarding Inter-Citic, see “Information Concerning Inter-Citic” in this Circular.

Western Mining Group Co., Ltd.

Western Mining Group Co., Ltd., which is referred to as Parent in this Circular, is an integrated resources development company established under the laws of The People’s Republic of China and is based in Qinghai Province, People’s Republic of China. Parent has total assets of approximately C$5.5 billion. Parent’s strategic-focussed management has taken the company into geological exploration, mining, processing, smelting, scientific research and development, trade, investment and financing. There are approximately 40 companies within Parent, including Western Mining Co., Ltd, which is listed on the Shanghai Stock Exchange. For additional information regarding Parent, see “Information Concerning Parent and Acquireco –Parent” in this Circular.

Acquireco

Acquireco is an indirect wholly-owned subsidiary of Parent incorporated under the CBCA. It has been formed and organized solely for the purpose of completing the Arrangement and, prior to Parent advancing to Acquireco the necessary funds to enable Acquireco to pay the aggregate Consideration under the Arrangement, will have no assets or liabilities other than nominal share capital held indirectly by Parent. In connection with the completion of the Arrangement,

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Acquireco will be funded, directly or indirectly, by Parent to enable Acquireco to pay the aggregate Consideration payable pursuant to the Arrangement.

Recommendation of the Special Committee

As part of the process of reviewing strategic alternatives available to Inter-Citic, the Special Committee undertook a thorough review of, and carefully considered, the Arrangement, the terms of the Arrangement Agreement, Inter-Citic’s current business, financial position, future plans and prospects and associated risks and uncertainties, as well as the alternatives to the Arrangement, including the potential for a more favourable transaction with another third party and the prospect of proceeding independently to pursue Inter-Citic’s current business plan. After consultation with its financial and legal advisors, the Special Committee, for the reasons set forth under the heading “The Arrangement — Reasons for the Recommendations of the Special Committee and the Board”, unanimously resolved that in the Special Committee’s view, the Arrangement is in the best interests of Inter-Citic and recommended that Inter-Citic enter into the Arrangement Agreement providing for the Arrangement, and that the Board recommend that Shareholders vote in favour of the Arrangement. See “The Arrangement — Recommendation of the Special Committee” in this Circular.

Recommendation of the Directors

After careful consideration and having received financial and legal advice, the Standard Chartered Opinion and the recommendation of the Special Committee, the Directors unanimously determined that it is in the best interests of Inter-Citic to enter into the Arrangement Agreement providing for the Arrangement, and authorized the submission of the Arrangement to the Shareholders for their approval at the Meeting. In adopting the recommendation of the Special Committee, the Board considered and relied upon the same factors and considerations that the Special Committee relied upon, as described below, and adopted the Special Committee’s analyses in their entirety. The Directors also unanimously determined to recommend to the Shareholders that they vote FOR the Arrangement Resolution.Pursuant to the terms of their Voting Support Agreements, each Director agreed to vote his Company Shares, if any, FOR the Arrangement Resolution. See “The Arrangement —Recommendation of the Directors” in this Circular.

Reasons for the Recommendations of the Special Committee and the Board

In evaluating the Arrangement, and in making their recommendations, the Special Committee and the Board received advice from their legal and financial advisors, gave careful consideration to Inter-Citic’s current business, financial position, future plans and prospects and the associated risks and uncertainties, as well as the terms of the Arrangement Agreement and the Arrangement. In reaching its conclusion that the Arrangement is in the best interests of Inter-Citic, the Special Committee considered and relied upon a number of factors, including the following:

! The Consideration of $2.05 in cash per Company Share represents an impliedpremium of approximately 41.4% over the $1.45 closing price of Company Shares on the TSX on August 24, 2012, the last trading day preceding the announcement of the Arrangement, and an implied premium of approximately 123% to Inter-Citic’s 20-day volume weighted average trading price of $0.9193 per share for Company Shares on the TSX on July 6, 2012, being the last trading day prior to the date on which Inter-Citic announced that it was in negotiations with a third party.

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! The Special Committee has received the Standard Chartered Opinion thatconcluded that as of the date of the Arrangement Agreement, based upon and subject to the respective assumptions, qualifications, explanations and limitations, as applicable, set forth therein, that the Consideration to be received pursuant to the Arrangement is fair from a financial point of view to the Shareholders.

! All of the Directors and two senior officers of Inter-Citic holding an aggregate of 1,012,385 Company Shares, representing approximately 0.86% of the outstanding Company Shares, as of August 24, 2012, entered into the Voting Support Agreements with Parent pursuant to which they agreed, subject to the terms thereof, to vote all of their Company Shares in favour of the Arrangement Resolution.

! The consideration payable to Shareholders pursuant to the Arrangement will be paid entirely in cash which provides certainty of value.

! The Arrangement is subject to a limited number of conditions and is not subject to any financing condition. The Special Committee believes that Parent has the financial capacity and operational expertise to complete the Arrangement.

! Except for the PRC Approvals, there are no material competition or other regulatory issues which are expected to arise in connection with the Arrangement so as to prevent its completion, and Parent has advised Inter-Citic that it expects that all required regulatory clearances and approvals will be obtained.

! Beginning in February 2011, Inter-Citic, led by the Special Committee with the assistance of Standard Chartered, reviewed and assessed expressions of interest to acquire Inter-Citic. The Special Committee evaluated the Arrangement in light of, among other things, the work undertaken by Standard Chartered pursuant to its engagement.

The Special Committee believes that the Arrangement is in the best interests of Inter-Citic and its Shareholders for the following additional reasons:

! The Arrangement Agreement and the Plan of Arrangement are the result of significant, arm’s length negotiations between Inter-Citic and Parent.

! The entering into of the Arrangement Agreement was preceded by a thorough review process by the Special Committee, which was advised by its financial and legal advisors.

! The Arrangement Resolution must be approved by at least two-thirds of the votes cast by the Shareholders present in person or represented by proxy at the Meeting and entitled to vote as well as approved by a simple majority of the votes cast at the Meeting, excluding the votes cast by any holders of Company shares that are required to be excluded in order to obtain “minority approval” pursuant to MI 61-101.

! Completion of the Arrangement will be subject to a judicial determination by the Court that the Arrangement is fair and reasonable.

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! The Arrangement Agreement does not prevent a third party from making an unsolicited Acquisition Proposal. Subject to compliance with the terms of the Arrangement Agreement, the Board is not precluded from considering and responding to an unsolicited Acquisition Proposal that is, or could reasonably be expected to lead to, a Superior Proposal at any time prior to the approval of the Arrangement Resolution by Shareholders. In the event that a Superior Proposal is made and not matched by Parent, upon payment by Inter-Citic to Parent of the Termination Fee, the Arrangement Agreement may be terminated by Inter-Citic and Inter-Citic may enter into a definitive agreement with respect to the Superior Proposal. In supervising the negotiation of the Termination Fee, the Special Committee sought to negotiate a fee that would not be reasonably expected to preclude a third party from making an unsolicited Superior Proposal. In addition, the Voting Support Agreements will terminate automatically in the event of termination of the Arrangement Agreement.

! Registered Shareholders who do not vote in favour of the Arrangement will have the ultimate right under the CBCA to obtain “fair value” for their Company Shares pursuant to the proper exercise of Dissent Rights.

! In the event that Parent or Acquireco breaches any of their respective representations, warranties, or fails to fulfil or comply in all material respects with their respective covenants on or prior to the Effective Time and such breach or failure is incapable of being cured, provided that any intentional breach shall be deemed to be incurable, or Parent does not provide, or cause to be provided, sufficient funds in cash to complete the transactions contemplated by the Arrangement and the Arrangement Agreement, other than in the case where the failure or failures of all representations and warranties to be so true and correct would not reasonably be expected to materially impair or delay the consummation of the Arrangement, Parent must pay to Inter-Citic the Break-Up Fee in the amount equal to the Termination Fee.

The Special Committee also considered a number of risks and potential negative factors relating to the Arrangement, including the following:

! The risks to Inter-Citic of the Arrangement not being completed, including the costs to Inter-Citic in pursuing the Arrangement and the diversion of management attention away from the conduct of Inter-Citic’s business and the potential impact on Inter-Citic’s relationships with its employees, suppliers and partners, as well as the risk factors described under “Risk Factors Related to the Arrangement” in this Circular.

! The restrictions on the conduct of Inter-Citic’s business prior to completion of the Arrangement, which may delay or prevent Inter-Citic from conducting explorationon the Dachang Project and undertaking business opportunities that may arise pending completion of the Arrangement.

! The fact that, if the Arrangement is successfully completed, Inter-Citic will no longer exist as an independent public company and the consummation of the Arrangement will eliminate the opportunity for Shareholders to participate in the longer term potential benefits of the business of Inter-Citic to the extent that those benefits exceed those potential benefits reflected in the cash consideration to be received under the Arrangement.

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! The conditions to Parent’s obligation to complete the Arrangement and the rights of Parent to terminate the Arrangement Agreement in certain circumstances, including if the Regulatory Approvals are not obtained by December 22, 2012.

! The fact that the Arrangement will be a taxable transaction for Canadian federal income tax purposes (and may also be a taxable transaction under other applicable tax laws) for certain Shareholders and, as a result, certain Shareholders will generally be required to pay taxes on any gains that result from the receipt of the consideration payable for their Company Shares under the Arrangement. See “Certain Canadian Federal Income Tax Considerations” in this Circular.

! The prohibition contained in the Arrangement Agreement on Inter-Citic’s ability to solicit Acquisition Proposals, as well as the fact that if the Arrangement Agreement is terminated in certain circumstances, Inter-Citic will be required to pay the Termination Fee to Parent.

! Even if the Arrangement Agreement is terminated without payment of the Termination Fee, Inter-Citic may, in the future, be required to pay the Termination Fee in certain circumstances where an Acquisition Proposal is entered into or consummated within nine months of the date on which an Acquisition Proposal is made (and not withdrawn) prior to the Meeting. Accordingly, if the Arrangement is not consummated and the Arrangement Agreement is terminated, Inter-Citic may not be able to consummate another Acquisition Proposal for a period of time without paying the Termination Fee.

The Special Committee is recommending the Arrangement based upon the totality of the information presented to and considered by it. The above discussion of the information and factors considered by the Special Committee is not intended to be exhaustive but is believed by the Special Committee to include the material factors considered by it in its assessment of the Arrangement. In view of the wide variety of factors considered by the Special Committee in connection with its assessment of the Arrangement, and the complexity of those matters, the Special Committee did not consider it practical, nor did it attempt, to quantify, rank or otherwise assign relative weights to the foregoing factors. In addition, in considering the factors described above, individual members of the Special Committee may have given different weights to various factors and may have applied different analyses to each of the material factors considered by the Special Committee.

See “The Arrangement — Reasons for the Recommendations of the Special Committee and the Board” in this Circular.

Opinion of Standard Chartered

Standard Chartered Opinion

Standard Chartered acted as the exclusive financial advisor to Inter-Citic with respect toassisting and advising Inter-Citic in exploring financing alternatives and evaluating potential strategic alternatives. On August 24, 2012, Standard Chartered delivered an oral opinion to the Special Committee and the Board, which was subsequently confirmed by delivery of a written opinion dated August 24, 2012, stating that, based upon and subject to the assumptions,qualifications and limitations set forth in the Standard Chartered Opinion, as of that date, the consideration for Company Shares to be received by the Shareholders in the Arrangement

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pursuant to the Arrangement Agreement was fair, from a financial point of view, to the Shareholders.

General Information Regarding the Standard Chartered Opinion

Standard Chartered provided the Standard Chartered Opinion solely for the information of and assistance to the Board (in its capacity as such) and the Special Committee, for purposes of the evaluation by the Special Committee and the Board, of the Consideration to be received by the Shareholders pursuant to the Arrangement, from a financial point of view. The Standard Chartered Opinion does not constitute, nor is intended to constitute, any recommendation as to how the Shareholders should vote at the Meeting. In addition, the Standard Chartered Opinion does not address any other aspect of the Arrangement and no opinion was expressed as to the Arrangement (other than as to the fairness, from a financial point of view, of the Consideration to be received by Shareholders pursuant to the Arrangement), the relative merits of the Arrangement in comparison to other strategies or transactions that might be available to Inter-Citic or in which Inter-Citic might engage, or as to the underlying business decision of Inter-Citic to proceed with or effect the Arrangement.

The summary of the Standard Chartered Opinion in this Circular is qualified in its entirety by reference to the full text of such Standard Chartered Opinion. The full text of the Standard Chartered Opinion, which sets out, among other things, the assumptions made, information reviewed, matters considered, and limitations on the scope of the review undertaken by Standard Chartered in rendering its opinion, is attached as Appendix D to this Circular. Shareholders are urged to read the Standard Chartered Opinion carefully and in its entirety.

See “The Arrangement — Opinion of Standard Chartered” in this Circular.

Interests of Directors, Senior Officers and Others in the Arrangement

As of the date of this Circular, the Directors and senior officers of Inter-Citic beneficially own, or exercise control or direction over, directly or indirectly, in the aggregate, 1,012,385 Company Shares, which represent approximately 0.86% of the total issued and outstanding Company Shares. All Company Shares held by the Directors and senior officers of Inter-Citic will be treated identically and in the same manner under the Arrangement as Company Shares held by any other Shareholder.

The Directors and senior officers of Inter-Citic beneficially own, or exercise control or direction over, directly or indirectly, in the aggregate, 6,842,826 Company Options as of the close of business on the date of this Circular. All of the Company Options held by the Directors and senior officers of Inter-Citic will be treated identically and in the same manner under the Arrangement as Company Options held by any other Optionholder. See “The Arrangement —Interests of Directors, Senior Officers and Others in the Arrangement” in this Circular.

The employment agreements of certain of the senior officers of Inter-Citic contain provisions that require certain amounts to be paid to them if the individual’s employment is terminated without “cause” or if he resigns within a certain time period after the occurrence of a change of control of Inter-Citic. A consulting agreement between BCLX Consulting Limited and Inter-Citic contains a provision that requires a certain amount to be paid to BCLX Consulting Limited if Inter-Citic terminates the consulting agreement. The payment of such amounts may be considered a “collateral benefit” pursuant to MI 61-101. The Arrangement may, therefore, be deemed to constitute a “business combination” pursuant to MI 61-101. See “Principal Legal Matters — Canadian Securities Law Considerations — Special Transaction Rules” in this Circular.

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All of the Directors and two senior officers entered into the Voting Support Agreements with Parent pursuant to which each of them agreed, subject to the terms thereof, to vote his or its Company Shares in favour of the Arrangement and any actions required in furtherance of the Arrangement. See “The Arrangement — Voting Support Agreements” in this Circular.

Particulars of the Arrangement

The Arrangement is an arrangement under Section 192 of the CBCA. It will become effective at the Effective Time and will become binding at and after such time on Inter-Citic, Parent, Acquireco, all registered and beneficial holders of Company Shares (including any Dissenting Shareholders), all Optionholders and Warrantholders, the Transfer Agent and the Depositary. The Plan of Arrangement sets out a series of transactions and steps that will occur starting at the Effective Time as a result of which, among other things, Acquireco will acquire all of Company Shares for consideration of $2.05 in cash per share. See “The Arrangement —Arrangement Mechanics” in this Circular.

Assuming the conditions set out in the Arrangement Agreement have been satisfied or, where permitted, waived, upon obtaining the Final Order, Inter-Citic intends to file the Articles of Arrangement with the CBCA Director as soon as reasonably practicable thereafter, at which time the Arrangement will become effective as at the Effective Time. As a result of the completion of the Arrangement, Shareholders will no longer have an ownership interest in Inter-Citic on completion of the Arrangement. Shortly after such completion, Company Shares will cease to be listed on the TSX and trading of Company Shares in the public market will no longer be possible. In addition, Parent is expected to seek to have Inter-Citic be deemed to cease being a reporting issuer under Canadian Securities Laws. Upon ceasing to be a reporting issuer in Canada, Inter-Citic will, among other things, no longer be required to file continuous disclosure documents with Canadian Securities Administrators. In the event that the Arrangement does not proceed for any reason, including because it does not receive the requisite Shareholder approvals, Court approval or Regulatory Approvals, Inter-Citic will continue operating as a publicly held company. See “The Arrangement — Particulars of the Arrangement” in this Circular.

Shareholder Approvals

At the Meeting, Shareholders will be asked to vote to approve the Arrangement Resolution. Pursuant to the Interim Order, and subject to any further order of the Court, the Arrangement Resolution must be approved by the affirmative vote of at least 662/3% of the votes cast by Shareholders present in person or represented by proxy at the Meeting and entitled to vote at the Meeting. In addition, as the Arrangement constitutes a “business combination” pursuant to MI 61-101, the Arrangement Resolution must also be approved by a simple majority of the votes cast at the Meeting, excluding the votes cast by any holders of Company Shares that are required to be excluded in order to obtain “minority approval” pursuant to MI 61-101. The Arrangement Resolution must receive the Required Arrangement Vote in order for Inter-Citic to seek the Final Order and implement the Arrangement on the Effective Date in accordance with the Final Order. Notwithstanding the approval by Shareholders of the Arrangement Resolution, Inter-Citic reserves the right not to proceed with the Arrangement, subject to and in accordance with the terms of the Arrangement Agreement and the Plan of Arrangement. See “The Arrangement — Shareholder Approvals” in this Circular.

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Arrangement Mechanics

Plan of Arrangement

The following description is qualified in its entirety by reference to the full text of the Plan of Arrangement, which is attached as Appendix C to this Circular. The Arrangement Agreement and the Plan of Arrangement provide that, commencing at the Effective Time, the following steps shall occur and shall be deemed to occur sequentially, in the order indicated below, without any further act or formality on the part of any person, in each case effective as at oneminute intervals starting at the Effective Time:

(a) notwithstanding the terms of the Rights Plan, the Rights Plan shall be terminated and all rights issued pursuant to the Rights Plan shall be cancelled without any payment in respect thereof;

(b) each Company Option outstanding immediately prior to the Effective Time (whether vested or unvested), notwithstanding the terms of the Stock Option Plan, shall be deemed to be unconditionally vested and exercisable, and such Company Option shall:

(i) without any further action by or on behalf of the holder of such option, be assigned and transferred by such holder to Inter-Citic in exchange for a cash payment from Inter-Citic equal to the amount (if any) by which the Consideration exceeds the exercise price thereof, less any withholdings or deductions in respect of taxes and other amounts required to be withheld or deducted therefrom under any applicable Laws; and

(ii) immediately be cancelled and all agreements related thereto shall be terminated, and the holder of such option shall thereafter have only the right to receive the consideration to which such holder is entitled pursuant to the Plan of Arrangement, at the time and in the manner specified in Article 5 of the Plan of Arrangement;

(c) each Warrant outstanding immediately prior to the Effective Time shall be transferred to Acquireco in exchange for a cash payment by Acquireco equal to the amount (if any) by which the Consideration exceeds the exercise price for such Warrant, less any withholdings or deductions in respect of taxes and other amounts required to be withheld or deducted therefrom under any applicable Laws;

(d) each Dissent Share shall be transferred by the holder of such share, free and clear of all Liens, to Acquireco in consideration for a debt claim against Acquireco to be paid fair value for each such Dissent Share;

(e) each Company Share outstanding at the Effective Time, other than any Dissent Shares and any Company Shares held by, if applicable, Parent, Acquireco or any of their respective affiliates (which Company Shares, if any, shall not be exchanged under the Arrangement but shall remain outstanding as Company Shares held by Parent, Acquireco or such affiliate), shall be deemed to be transferred by the holder of such Company Share, free and clear of any Liens, to Acquireco, and such holder shall be entitled to receive in exchange therefor from Acquireco the Consideration for each Company Share held; and

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(f) the names of the holders of Company Shares or Dissent Shares, as the case may be, transferred to Acquireco shall be removed from the applicable registers of holders of Company Shares, and Acquireco shall be recorded as the registered holder of Company Shares and Dissent Shares so transferred and shall be deemed the legal and beneficial owner of such shares, free and clear of any Liens.

If the Required Arrangement Vote is obtained, the Final Order is granted and all other conditions under the Arrangement Agreement are satisfied or, where permitted, waived, the Articles of Arrangement will be filed with the CBCA Director as soon as reasonably practicable thereafter. Upon the issuance of the Certificate of Arrangement, the Plan of Arrangement will become effective at the Effective Time and will be binding at and after such time on Inter-Citic, Parent, Acquireco, all registered and beneficial holders of Company Shares (including any Dissenting Shareholders), all Optionholders and Warrantholders, the Transfer Agent and the Depositary.

See “The Arrangement — Arrangement Mechanics” in this Circular.

The Arrangement Agreement

On August 24, 2012, Inter-Citic, Parent and Acquireco entered into the Arrangement Agreement, under which they agreed that, upon the terms and subject to the conditions set forth in the Arrangement Agreement, Acquireco will acquire all of the issued and outstanding Company Shares as part of and in accordance with the Plan of Arrangement, whereby Shareholders (other than Dissenting Shareholders, if any) will receive $2.05 in cash, without interest and subject to any withholdings or deductions in respect of taxes and other amounts required to be withheld or deducted therefrom under any applicable Laws, for each Company Share held. The terms of the Arrangement Agreement are the result of arm’s length negotiations conducted between Inter-Citic, Parent and Acquireco and their respective advisors.

A full copy of the Arrangement Agreement is attached as Appendix B to this Circular. Shareholders should read the Arrangement Agreement carefully and in its entirety, as the rights and obligations of Inter-Citic, Parent and Acquireco are governed by the express terms of the Arrangement Agreement and not by this summary or any other information contained in this Circular. See “The Arrangement Agreement” in this Circular.

Conditions Precedent to the Arrangement

Mutual Conditions Precedent

The respective obligations of the Parties to the Arrangement Agreement to complete the Arrangement are subject to the fulfilment or waiver, on or before the Effective Time, of certain conditions precedent that may only be waived with the mutual consent of Inter-Citic, Parent and Acquireco. These conditions include the conditions that the Arrangement Resolution will have been approved and adopted at the Meeting by not less than the Required Arrangement Vote and otherwise in accordance with the Interim Order, that the Interim Order and the Final Order will each have been obtained in form and on terms satisfactory to the Parties, and that the Regulatory Approvals will have been obtained. See “The Arrangement Agreement — Conditions Precedent to the Arrangement — Mutual Conditions Precedent” in this Circular.

Parent and Acquireco Conditions Precedent

The obligations of Parent and Acquireco to complete the transactions contemplated by the Arrangement Agreement are also subject to the fulfillment or waiver, on or before the Effective

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Time, of certain conditions precedent that are for the exclusive benefit of Parent and Acquireco and may be waived by Parent. These additional conditions include: truth and correctness of Inter-Citic’s representations and warranties; performance by Inter-Citic of its covenants under the Arrangement Agreement; absence of any pending or threatened action or proceeding to (i) impose any limitations over Parent’s and Acquireco’s ability to acquire ownership of the Company Shares, (ii) restrict the Arrangement, or (iii) delay the consummation of the Arrangement; absence of a Material Adverse Effect; termination of SRP Rights; no exercise of Dissent Rights with respect to more than 5% of Company Shares; and no material adverse breach of the Voting Support Agreements; and resignations of each Director and senior officer of Inter-Citic. See “The Arrangement Agreement — Conditions Precedent to the Arrangement —Parent and Acquireco Conditions Precedent” in this Circular.

Inter-Citic Conditions Precedent

The obligations of Inter-Citic to complete the Arrangement Agreement are also subject to the fulfillment or waiver, on or before the Effective Time, of certain additional conditions precedent that are for the exclusive benefit of Inter-Citic and may be waived by it. These additional conditions include: truth and correctness of Parent and Acquireco’s representations and warranties; performance by Parent and Acquireco of their covenants under the Arrangement Agreement; and deposit by Parent of the aggregate Consideration with the Depositary, Inter-Citic and Acquireco. See “The Arrangement Agreement — Conditions Precedent to the Arrangement — Inter-Citic Conditions Precedent” in this Circular.

Representations and Warranties

The Arrangement Agreement contains customary representations and warranties on the part of Inter-Citic relating to: organization and qualification; authority; no conflict; governmental approvals; Competition Act; Investment Canada Act; fairness opinion; subsidiaries; status of Joint Venture; regulatory filings; compliance with Laws; Company authorizations; capitalizationand listing; Rights Plan, Zijin rights; Shareholder and similar agreements; Financial Statements;undisclosed liabilities; exploration licenses; mineral resources; technical data; project matters;employment matters; absence of certain changes or events; litigation; Taxes; books and records; insurance; non-arm’s length transactions; Foreign Corrupt Practices Laws;environmental; Material Contracts; Joint Venture Agreement; brokers; reporting issuer status; stock exchange compliance; no expropriation; and Board recommendation.

Further, the Arrangement Agreement includes certain customary representations and warranties of Parent and Acquireco relating to: organization; authority; no violation; enforceability; no breach; consents and approvals; litigation; financing; escrow; Regulatory Approvals; and Security ownership. See “The Arrangement Agreement — Representations and Warranties” in this Circular.

Covenants of Parties

Covenants of Inter-Citic

Inter-Citic assumed customary negative and affirmative covenants under the Arrangement Agreement, including covenants relating to various aspects of the conduct of its business in the ordinary course and covenants to use commercially reasonable efforts to satisfy the conditions precedent under the Arrangement Agreement and otherwise to consummate the Arrangement as soon as reasonably practicable. See “The Arrangement Agreement — Covenants of Inter-Citic” in this Circular.

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Covenants of Parent and Acquireco

Parent and Acquireco agreed to perform all of their obligations under the Arrangement Agreement, co-operate with Inter-Citic in connection therewith and do all such other acts and things as may be necessary in order to consummate the Arrangement as soon as reasonably practicable, including the use of their best efforts to obtain the Regulatory Approvals. See “The Arrangement Agreement — Covenants of Parent and Acquireco” in this Circular.

Mutual Covenants

The Parties to the Arrangement Agreement also assumed mutual covenants, including covenants to use reasonable commercial efforts to co-operate with one another in connection with the performance of the obligations and satisfaction of the conditions precedent under the Arrangement Agreement, to consult with one another regarding the process of obtaining the Regulatory Approvals, and to share all relevant information relating to obtaining the Regulatory Approvals or any other governmental approvals up to the completion of the Arrangement. See “The Arrangement Agreement — Mutual Covenants” in this Circular.

Non-Solicitation Obligations of Inter-Citic

Inter-Citic agreed that it, as well as its Directors, officers, employees, representatives, affiliatesand agents, will not: take any action to solicit, initiate, assist, encourage or otherwise facilitate any inquiry, proposal or offer that constitutes or may reasonably be expected to constitute or lead to, an Acquisition Proposal; and will not enter into or otherwise engage or participate in discussions or negotiations with any person (other than Parent and its affiliates) with respect to any inquiry, proposal or offer that constitutes, or could be expected to constitute or lead to, an Acquisition Proposal. If Inter-Citic or any of its affiliates or any of their respective representatives, receives or otherwise becomes aware of any inquiry, proposal or offer that constitutes or could constitute or reasonably be expected to lead to an Acquisition Proposal, or any request for copies of, access to, or disclosure of, confidential information relating to Inter-Citic or any affiliate, and Inter-Citic shall keep Parent promptly and fully informed as to the status of material details including any change in the terms of such proposal or request. However, at any time prior to obtaining the Required Arrangement Vote, if Inter-Citic receives a bona fide written Acquisition Proposal that the Board determines in good faith, after consultation with its outside legal counsel and financial advisors, is or could reasonably be expected to result in, if consummated in accordance with its terms, a Superior Proposal, then the Company may,subject to certain conditions:

(a) furnish information with respect to Inter-Citic and its affiliates to the person making such Acquisition Proposal; and/or

(b) enter into, participate, and maintain discussions or negotiations with, and otherwise cooperate with or assist, the Person making such Acquisition Proposal.

See “The Arrangement Agreement — Non-Solicitation Obligations of Inter-Citic” in this Circular.

Superior Proposal

Subject to specified conditions and restrictions, including the exercise of Parent’s right to match, compliance by Inter-Citic with its non-solicitation covenants and the payment of the Termination Fee to Parent, and prior to obtaining the Required Arrangement Vote, the Board may terminate the Arrangement Agreement in order to accept and enter into a definitive agreement in respect of an Acquisition Proposal that the Board determines, in its good faith judgment and after

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consultation with its financial advisor and its outside legal counsel, constitutes a Superior Proposal. See “The Arrangement Agreement — Superior Proposal” in this Circular.

Parent’s Matching Right

In connection with any Superior Proposal, Parent has the right, but not the obligation, to amend the terms of the Arrangement in writing within five business days from being properly notified and informed of the Superior Proposal, and the Board is required to review and assess in good faith any such proposal by Parent to amend the terms of the Arrangement. See “The Arrangement Agreement — Parent’s Matching Right” in this Circular.

Termination

Inter-Citic, Parent and Acquireco are entitled to terminate the Arrangement Agreement in specified circumstances at any time (prior to the Effective Time) by mutual written consent of the Parties. In addition, Inter-Citic or Parent may terminate the Arrangement Agreement if certain events occur or do not occur within applicable time frames, including if the Effective Time has not occurred on or before the Outside Date, if the Regulatory Approvals have not been obtained on or before the Outside Date, or if the Required Arrangement Vote is not obtained at the Meeting (including any adjournment or postponement of the Meeting). In addition, Parent alone or Inter-Citic alone may terminate the Arrangement Agreement in the event of, among other things, and subject to certain conditions and parameters, uncured breaches by the other Party of any of its representations, warranties, covenants or agreements in the Arrangement Agreement such that the conditions in the Arrangement Agreement are incapable of being satisfied on or before the Outside Date; or in connection with the negotiation and entering into by Inter-Citic, subject to compliance by Inter-Citic with the non-solicitation, right to match and payment of the Termination Fee covenants, of a binding agreement with respect to a Superior Proposal. See “The Arrangement Agreement — Termination” in this Circular.

Termination Fee, Break-Up Fee and Expenses

The Arrangement Agreement provides for the payment by Inter-Citic to Parent of the Termination Fee, in the amount of $7 million, in certain circumstances in which the Arrangement Agreement is terminated. In certain other circumstances where Inter-Citic terminates the Arrangement Agreement, Parent is required to pay to Inter-Citic the Break-Up Fee, the amount of which is equal to the Termination Fee. All fees, costs and expenses incurred by the Parties in connection with the Arrangement Agreement and the Plan of Arrangement, other than certain specified expenses, are payable by the Party incurring such fees, costs or expenses. See “The Arrangement Agreement — Termination Fee, Break-Up Fee and Expenses” in this Circular.

Directors’ and Officers’ Insurance and Indemnification

Parent agreed to fulfill and honour, from and after the Effective Time, and shall cause Inter-Citic and/or its successors to fulfil and honour, the obligations of Inter-Citic and/or its successor(s) under the existing indemnification agreements between Inter-Citic and its present or former Directors or officers and under indemnification provisions of Inter-Citic’s constating documents or the applicable Laws. In addition, Inter-Citic agreed to obtain and pay and, if Inter-Citic is unable to do so, Parent agreed to cause it to obtain and pay, the premium for the extension of the directors’ and officers’ liability coverage under the existing primary and excess directors’ and officers’ insurance policies for Inter-Citic and its Subsidiaries for a period of at least six years after the Effective Time, upon terms, conditions, retentions and limits of liability no less advantageous than the coverage provided under the existing policies of Inter-Citic and its Subsidiaries, up to a maximum of 200% of the aggregate premium paid by Inter-Citic for its

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current primary and excess directors’ and officers’ insurance policies. See “The Arrangement Agreement — Directors’ and Officers’ Insurance and Indemnification” in this Circular.

Amendment

At any time before or after the holding of the Meeting, but not later than the Effective Time, Inter-Citic, Parent and Acquireco may amend the terms of the Arrangement Agreement and the Plan of Arrangement by mutual written agreement. See “The Arrangement Agreement —Amendment” in this Circular.

Sources of Funds for the Arrangement

Assuming no Shareholders exercise their Dissent Rights and 117,573,645 Company Shares are outstanding at the Effective Time, (a) approximately $241,025,972 will be required by Parent to fund the Consideration for Acquireco’s acquisition of all of the outstanding Company Shares under the Plan of Arrangement, (b) approximately $7,600,000 will be loaned by Parent to Inter-Citic to be used by Inter-Citic to fund Inter-Citic’s payments in respect of the outstanding Company Options under the Plan of Arrangement, and (c) approximately $276,000 will be required by Parent to fund the acquisition by Acquireco of the Warrants. See “The Arrangement — Sources of Funds for the Arrangement” in this Circular.

Voting Support Agreements

All of the Directors and two senior officers entered into voting support agreements with Parent pursuant to which they agreed, subject to the terms thereof, to vote their Company Shares in favour of the Arrangement and any actions required in furtherance of the Arrangement. See “The Arrangement — Voting Support Agreements” in this Circular.

Principal Legal Matters

Court Approval of the Arrangement and Completion of the Arrangement

The Arrangement requires Court approval under the CBCA. On October 3, 2012, prior to the mailing of this Circular, Inter-Citic obtained the Interim Order, which provides for the calling and holding of the Meeting, the Dissent Rights and other procedural matters. A copy of the InterimOrder is attached as Appendix F to this Circular. A copy of the Notice of Application in respect of the Final Order is attached as Appendix E to this Circular.

Subject to obtaining the Required Arrangement Vote in accordance with the Interim Order, the hearing in respect of the Final Order is currently scheduled to take place on November 1, 2012 at 10:00 a.m. (EDT) in the Court at 330 University Avenue, Toronto, Ontario. The Court, in hearing the motion for the Final Order, will consider, among other things, the fairness of the Arrangement.

If (a) the Required Arrangement Vote is obtained, (b) the Final Order is granted, and (c) all other conditions under the Arrangement Agreement are satisfied or, where permitted, waived, the Articles of Arrangement will be filed with the CBCA Director and the Arrangement will become effective on the Effective Date. Inter-Citic and Parent currently expect that the Effective Date will occur early in November 2012.

See “Principal Legal Matters — Court Approval of the Arrangement and Completion of the Arrangement” in this Circular.

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Regulatory Matters

The Arrangement is conditional upon receipt of certain third party approvals, including the Regulatory Approvals. See “Principal Legal Matters — Regulatory Matters” in this Circular.

Certain Canadian Federal Income Tax Considerations

Generally, a Shareholder who is resident in Canada for purposes of the Tax Act and who holds his, her or its Company Shares as capital property and disposes of such Company Shares to Acquireco under the Arrangement will realize a capital gain (or capital loss) in an amount equal to the amount by which the proceeds of disposition of such Company Shares, net of any reasonable costs of disposition, exceed (or are less than) the adjusted cost base to the Shareholder of such Company Shares immediately before the disposition.

Generally, a Shareholder who is not resident in Canada for purposes of the Tax Act and who holds his, her or its Company Shares as capital property, will not be subject to tax under the Tax Act on any capital gain realized on a disposition of Company Shares unless Company Shares are “taxable Canadian property” (as defined in the Tax Act) to the Shareholder and the capital gain is not otherwise exempt from tax under the Tax Act pursuant to the provisions of an applicable income tax treaty.

See “Certain Canadian Federal Income Tax Considerations” in this Circular. The foregoing is a brief summary of certain Canadian federal income tax consequences only. Shareholders should review the more detailed information under the above-noted heading and consult with their own tax advisors regarding their particular circumstances.

Dissenting Registered Shareholders’ Rights

In accordance with the Interim Order and the CBCA, Registered Shareholders only may exercise Dissent Rights in respect of the Arrangement Resolution, pursuant to and in the manner set forth in Section 190 of the CBCA, as modified by the Interim Order and the Final Order. Shareholders who duly exercise Dissent Rights are entitled to be paid fair value for their Company Shares, which fair value, notwithstanding anything to the contrary contained in the CBCA, shall be determined as of the close of business on the day before the Effective Date. In no circumstances will Inter-Citic, Parent, Acquireco or any other person be required to recognize a person exercising Dissent Rights unless such person is a Registered Shareholder of those Company Shares in respect of which such rights are sought to be exercised. In addition to any other restrictions under Section 190 of the CBCA, none of the following shall be entitled to exercise Dissent Rights: (a) Optionholders and Warrantholders, and (b) Shareholders who vote, or are deemed to have instructed a proxyholder to vote, for the Arrangement Resolution.

For a summary of certain Canadian federal tax considerations relevant to a Dissenting Shareholder, see “Certain Canadian Federal Income Tax Considerations” in this Circular.

A Registered Shareholder who wishes to dissent must provide a written objection to the Arrangement Resolution referred to in Section 190(5) of the CBCA to Inter-Citic, which must be received not later than 5:00 p.m. (EDT) on Friday, October 26, 2012 (or the date that is one business day immediately preceding the date set for any adjournment or postponement of the Meeting).

The full text of Section 190 of the CBCA is attached as Appendix G to this Circular. It is recommended that any Registered Shareholder wishing to avail itself of its Dissent Rights under those provisions seek legal advice, as failure to comply strictly with the provisions of the CBCA

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(as modified by the Plan of Arrangement, the Interim Order and the Final Order) may result in loss of its Dissent Rights.

See “Dissenting Registered Shareholders’ Rights” in this Circular.

Risk Factors Related to the Arrangement

There are various risks associated with the non-completion of the Arrangement, including the following:

! There can be no certainty, nor can Inter-Citic provide any assurance, that all conditions precedent to the Arrangement will be satisfied or, where permitted, waived or as to the timing of their satisfaction or waiver. Failure to complete the Arrangement, for any reason, could negatively impact the market price of Company Shares.

! The Arrangement Agreement may be terminated by Inter-Citic or Parent in certain circumstances. If the Arrangement Agreement is terminated, there is no assurance that the Directors will be able to find a party willing to pay an equivalent or a more attractive price for Company Shares than the price that Parent is willing to pay for Company Shares under the Arrangement.

! The Termination Fee provided under the Arrangement Agreement may discourage other parties from attempting to acquire Inter-Citic.

See “Risk Factors Related to the Arrangement” in this Circular.

The foregoing risk factors are in addition to those set out under the heading “Information Concerning Inter-Citic — Risk Factors Related to Inter-Citic” in this Circular. See also “Cautionary Statement Regarding Forward-Looking Statements” in this Circular.

THE ARRANGEMENT

Background to the Arrangement

The provisions of the Arrangement Agreement are the result of extensive arm’s length negotiations conducted between representatives of Inter-Citic, Parent and their respective advisors. The following is a summary of the meetings, negotiations, discussions and actions that preceded the execution of the Arrangement Agreement and the public announcement of the Arrangement.

During the fourth calendar quarter of 2009, management of Zijin Mining, a People’s Republic of China based state-owned gold producer listed on the Hong Kong and Shanghai stock exchanges, contacted Inter-Citic’s senior management and met with them to discuss a proposed private placement to Zijin Mining of common shares in the capital of Inter-Citic. On April 15, 2010, Inter-Citic announced that it had agreed to a private placement (“Zijin Private Placement”) of common shares to Zijin Mining at a price of $1.16 per common share for gross proceeds of $18.56 million with Zijin Mining acquiring a 19.15% interest in Inter-Citic. The subscription agreement for the Zijin Private Placement stipulated among other things:

! Zijin Mining would have a participation right to acquire a maximum of a 19.9% interest in Inter-Citic by participating in future equity financings of Inter-Citic until the earlier of the date on which Zijin held less than 19% of the outstanding common shares of Inter-Citic and 42 months following the date of closing of the Zijin Private Placement (the “Participation Period”).

! During the Participation Period, Inter-Citic agreed to support the nomination of one Zijin Mining nominee to the Board.

! For 24 months from the date of closing of the Zijin Private Placement (subject to a change of control or a change of management), Zijin Mining would not vote against management in respect of certain matters.

! For 12 months from the date of closing of the Zijin Private Placement, Zijin Mining would not sell or otherwise dispose of, or lend for the purpose of short selling, any common shares of Inter-Citic other than in connection with certain change of control transactions.

! For a period of 24 months from the date of closing of the Zijin Private Placement, Zijin Mining would not, among other things, make any offer to acquire securities of Inter-Citic without the consent of the Board.

At the conclusion of 2010, Inter-Citic’s management was evaluating its development options and the corresponding financial requirements for the Dachang Project in the context of a challenging permitting regime in The People’s Republic of China. Recognizing these business risks as well as a near term financing requirement, on January 13, 2011, Inter-Citic’s senior management, having already interviewed a number of financial advisors, engaged Standard Chartered as a financial advisor to Inter-Citic to assist and advise Inter-Citic in exploring financing alternatives and to evaluate potential strategic alternatives.

In February, 2011, management of Inter-Citic met with representatives of Zijin Mining in order to provide a normal course update on Inter-Citic’s operations and overall performance. During these meetings Zijin Mining expressed an interest in acquiring the Dachang Project. As a result, on February 23, 2011, the Board established the Special Committee consisting of the following

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Directors: Messrs. Carlos Ho (as Chairman) and Michael Doggett. The Special Committee’s mandate involves, among other things, the review and evaluation of potential strategic alternatives for Inter-Citic, including a potential business transaction such as a sale or merger.

On February 28, 2011, Miller Thomson LLP, legal counsel to Inter-Citic, reviewed with the Special Committee the mandate of the Special Committee and discussed in detail the duties and responsibilities of the Special Committee. The Special Committee met with Inter-Citic management to consider their meetings with Zijin Mining and its expression of interest in acquiring Inter-Citic.

Subsequent meetings were held with Zijin Mining in March and April, 2011. No agreement with Zijin Mining was reached at that time.

In March and April, 2011, with the assistance of Standard Chartered, management of Inter-Citic engaged in discussions with a Chinese non-state owned gold producing company referred to as Company A in this Circular. These discussions led to an expression of Company A’s interest in the Dachang Project and due diligence by Company A regarding Inter-Citic, including a site visit to the Dachang Project in June, 2011. Discussions with Company A were discontinued in August 2011 for reasons not in the control of Inter-Citic. Company A’s interest in Inter-Citic is not expected to revive.

On May 26, 2011, Inter-Citic announced a non-brokered private placement financing of up to 11,052,632 common shares of Inter-Citic at a price $1.90 per common share for total gross proceeds of up to $21,000,000. The financing occurred in two tranches and the maximum financing was completed on July 8, 2011. Zijin Mining did not exercise its right to participate in this financing thereby terminating its participation right under the April 15, 2010 agreement in respect of the Zijin Private Placement.

On July 13, 2011, Inter-Citic issued a news release announcing that the Board had engaged Standard Chartered as a financial advisor to advise Inter-Citic and the Board in connection with the ongoing review of Inter-Citic’s strategy, capital structure and future financing alternatives.

During September 2011, Standard Chartered introduced to Inter-Citic a non-Chinese gold mining company, referred to as Company B in this section of the Circular, in which the government of The People’s Republic of China holds a significant equity stake. Senior management of Inter-Citic instructed Standard Chartered to secure a confidentiality and stand-still agreement with Company B in order to facilitate further discussions and an exchange of information. On September 15, 2011 Inter-Citic entered into a confidentiality and stand-still agreement with Company B.

On or about September 29, 2011, the Chairman of Inter-Citic received from Parent’s financial advisor an initial unsolicited non-binding proposal from the Parent to acquire all of the outstanding common shares of Inter-Citic for cash consideration of $1.20 to $1.70 per common share. Parent’s financial advisor informed the Chairman of Inter-Citic that the proposal from Parent came with the support of the government of the province of Qinghai and that Parent had received pre-approval to negotiate with Inter-Citic from the National Development and Reform Commission of The People’s Republic of China. On September 30, 2011, the Special Committee met to consider the Parent’s proposal and the advice of Inter-Citic’s legal and financial advisors. At that meeting, the Special Committee instructed senior management of Inter-Citic to advise Parent that its proposal was inadequate. Inter-Citic entered into a confidentiality and stand-still agreement with Parent in November 2011.

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On October 6, 2011, Inter-Citic issued a press release stating that an unsolicited proposal was received from a Chinese mining company (no name basis) to acquire all of the outstanding common shares of Inter-Citic for an indicative price of between $1.20 and $1.70 per common share of Inter-Citic, and that the proposal had been rejected by the Special Committee. The unnamed mining company is the Parent.

On October 17, 2011, management of Inter-Citic met with representatives of Zijin Mining to assess their views on Inter-Citic’s October 6, 2011 press release and determine whether Zijin Mining was prepared to provide a competing proposal. At that meeting, Zijin Mining informed management of Inter-Citic that, in light of political considerations in The People’s Republic of China, they would not interfere with Inter-Citic’s discussions with Parent and, further, that they would not consider making a proposal to acquire Inter-Citic while discussions with Parent were proceeding.

During October and November of 2011, Inter-Citic management opened its data room to Company B. On December 12, 2011, Company B informed Inter-Citic that, among other things, as a result of local government issues, Company B had come to the conclusion that it would not continue its discussions with Inter-Citic.

In December, 2011, Inter-Citic and the Parent held discussions concerning its proposed acquisition of Inter-Citic. Both parties agreed to continue discussions over the near term while Parent continued its due diligence on Inter-Citic and proceeded with a site visit to the Dachang Project.

From January, 2012 to June, 2012, the Parent continued its due diligence on the Dachang Project. Several discussions were held between Inter-Citic management, on the direction of the Special Committee, and the Parent regarding details for a potential transaction.

On June 28, 2012, an indicative non-binding offer price of $2.05 per common share of Inter-Citic was agreed to in principle between the management of each of Inter-Citic and Parent, subject to board approval of each party, completion of due diligence, the negotiation of key terms for the transaction, and agreement on the definitive form of the arrangement agreement.

On July 9, 2012, at the request of Market Surveillance on behalf of the TSX, Inter-Citic announced that it was in negotiations with a third party interested in acquiring all of Inter-Citic’scommon shares.

From June 28, 2012 to August 24, 2012, Inter-Citic and the Parent negotiated the key terms and conditions of the Arrangement Agreement.

On July 19, 2012, the Company received an unsolicited non-binding proposal to acquire all of the common shares from a People’s Republic of China mining state owned enterprise, referred to as Company C in this section of the Circular. Company C’s proposal contemplated an acquisition of all of the outstanding common shares of Inter-Citic at an indicative price of $2.12 per common share. Inter-Citic held initial conference call meetings with Company C on July 20, 2012 and August 3, 2012. On July 19, 2012, July 26, 2012 and July 31, 2012, the Special Committee met and on July 31, 2012, the Board met to consider the proposal from Company Cand the status of negotiations with the Parent. Standard Chartered participated in the Special Committee meeting on July 26, 2012 and July 31, 2012, and the Board meeting on July 31, 2012. The Company’s legal advisor participated in all Special Committee and Board meetings.

On August 2, 2012, in response to an inquiry from the President and Chief Executive Officer of Inter-Citic, Company C acknowledged that it was aware that Inter-Citic was engaged in

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negotiations with a third party and Company C indicated that it was prepared to provide a superior offer to Inter-Citic and its shareholders subject to due diligence. Company C also advised Inter-Citic that Company C would not require formal approval from the PRC government for an acquisition of Inter-Citic since the anticipated transaction value was less than USD$300 million. On August 9, 2012, Company C indicated that until such time as Inter-Citic’s negotiations with the Parent were terminated, Company C would not pursue its interest in acquiring shares of Inter-Citic.

On August 23 and 24, 2012, each of the Special Committee and the Board held meetings with participation, at various times, by members of management, representatives of Standard Chartered and Miller Thomson LLP. At these meetings the terms of the proposed transaction with the Parent and the Arrangement Agreement were reviewed and discussed in detail along with advice of legal counsel to the Company and the Special Committee and input from management.

At the August 23 and 24, 2012 meetings of the Special Committee, Standard Chartered delivered to the Committee members an oral opinion (which was subsequently confirmed by delivery of a written opinion dated August 24, 2012), subject to the assumptions, qualifications and limitations set forth in such opinion and as of that date, as to fairness, from a financial point of view, to the Shareholders of the Consideration for the Company Shares to be received by the Shareholders in the proposed Arrangement. After consultation with representatives of Standard Chartered and consideration of the Standard Chartered Opinion and having received advice of legal counsel, the Special Committee unanimously resolved that the Arrangement was in the best interests of Inter-Citic and recommended that Inter-Citic enter into the Arrangement Agreement providing for the Arrangement, and that the Board recommend that the Shareholders vote in favour of the Arrangement.

On August 24, 2012, after deliberation and discussion, and having considered the unanimous recommendation of the Special Committee, the proposed terms of the Arrangement Agreement, the oral opinion and advice given by Standard Chartered and Inter-Citic’s legal counsel, the Board, by unanimous decision of the Directors: adopted the recommendation of the Special Committee; resolved that it was in the best interests of Inter-Citic to enter into the Arrangement Agreement providing for the Arrangement; approved the execution and delivery of the Arrangement Agreement; authorized the submission of the Arrangement to Shareholders for their approval at the Meeting; and determined to recommend that Shareholders vote in favour of the Arrangement at the Meeting.

On August 24, 2012, Inter-Citic and Parent and their respective legal counsel finalized the Arrangement Agreement (including the Plan of Arrangement) which was then executed by the Parties. Concurrently with the execution and delivery of the Arrangement Agreement, each of the Directors and the executive officers of Inter-Citic executed a Voting Support Agreement with Parent.

On the morning of August 27, 2012, prior to the opening of the TSX, Inter-Citic announced the execution and delivery of the Arrangement Agreement and the principal terms of the Arrangement. A corresponding press release issued by Inter-Citic was also filed on SEDAR.

Recommendation of the Special Committee

As part of the process of reviewing strategic alternatives available to Inter-Citic, the Special Committee undertook a thorough review of, and carefully considered, the Arrangement, the terms of the Arrangement Agreement, Inter-Citic’s current business, financial position and future plans and prospects and associated risks and uncertainties, as well as the alternatives to the

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Arrangement, including the potential for a more favourable transaction with another third party and the prospect of proceeding independently to pursue Inter-Citic’s current business plan. After consultation with its financial and legal advisors, the Special Committee, for the reasons set forth under the heading “The Arrangement — Reasons for the Recommendations of the Special Committee and the Board”, unanimously resolved that the Arrangement was in the best interests of Inter-Citic and recommended that Inter-Citic enter into the Arrangement Agreement providing for the Arrangement, and that the Board recommend that Shareholders vote in favour of the Arrangement.

Recommendation of the Directors

After deliberation and discussion, and having considered the unanimous recommendation of the Special Committee, the proposed terms of the Arrangement Agreement, the oral opinion and advice given by Standard Chartered and Inter-Citic’s legal counsel, the Board, by unanimous decision of the Directors: adopted the recommendation of the Special Committee; resolved that it was in the best interests of Inter-Citic to enter into the Arrangement Agreement providing for the Arrangement; approved the execution and delivery of the Arrangement Agreement; authorized the submission of the Arrangement to Shareholders for their approval at the Meeting; and determined to recommend that Shareholders vote in favour of the Arrangement at the Meeting. In adopting the recommendation of the Special Committee, the Board considered and relied upon the same factors and considerations that the Special Committee relied upon, as described below, and adopted the Special Committee’s analyses in their entirety. The Directors also unanimously determined to recommend to the Shareholders that they vote FOR the Arrangement Resolution. Pursuant to the terms of their Voting Support Agreements, each Director agreed to vote his Company Shares, if any, FOR the Arrangement Resolution.

Reasons for the Recommendations of the Special Committee and the Board

In evaluating the Arrangement, and in making their recommendations, the Special Committee and the Board received advice from their legal and financial advisors, gave careful consideration to Inter-Citic’s current business, financial position and future plans and prospects and the associated risks and uncertainties, as well as the terms of the Arrangement Agreement and the Arrangement. In reaching its conclusion that the Arrangement is in the best interests of Inter-Citic, the Special Committee considered and relied upon a number of factors, including the following:

! The Consideration of $2.05 in cash per Company Share represents an impliedpremium of approximately 41.4% over the $1.45 closing price of Company Shares on the TSX on August 24, 2012, the last trading day preceding the announcement of the Arrangement, and an implied premium of approximately 123% to Inter-Citic’s 20-day volume weighted average trading price of $0.9193 per share for Company Shares on the TSX on July 6, 2012, being the last trading day prior to the date on which Inter-Citic announced that it was in negotiations with a third party.

! The Special Committee has received the Standard Chartered Opinion thatconcluded that as of the date of the Arrangement Agreement, based upon and subject to the respective assumptions, qualifications, explanations and limitations, as applicable, set forth therein, that the Consideration to be received pursuant to the Arrangement is fair from a financial point of view to the Shareholders.

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! All of the Directors and two senior officers holding an aggregate of 1,012,385Company Shares, representing approximately 0.86% of the outstanding Company Shares, as of October 1, 2012, entered into the Voting Support Agreements with Parent pursuant to which they agreed, subject to the terms thereof, to vote all of their Company Shares in favour of the Arrangement Resolution.

! The consideration payable to Shareholders pursuant to the Arrangement will be paid entirely in cash, which provides certainty of value.

! The Arrangement is subject to a limited number of conditions and is not subject to any financing condition. The Special Committee believes that Parent has the financial capacity and operational expertise to complete the Arrangement.

! Except for the PRC Approvals, there are no material competition or other regulatory issues which are expected to arise in connection with the Arrangement so as to prevent its completion, and Parent has advised Inter-Citic that it expects that all required regulatory clearances and approvals will be obtained.

! Beginning in February 2011, Inter-Citic, led by the Special Committee with the assistance of Standard Chartered, reviewed and assessed a number ofexpressions of interest to acquire Inter-Citic. The Special Committee evaluated the Arrangement in light of, among other things, the work undertaken by Standard Chartered pursuant to its engagement.

The Special Committee believes that the Arrangement is in the best interests of Inter-Citic for the following additional reasons:

! The Arrangement Agreement and the Plan of Arrangement are the result of significant, arm’s length negotiations between Inter-Citic and Parent.

! The entering into of the Arrangement Agreement was preceded by a thorough review process by the Special Committee, which was advised by its financial and legal advisors.

! The Arrangement Resolution must be approved by at least two-thirds of the votes cast by the Shareholders present in person or represented by proxy at the Meeting and entitled to vote, as well as approved by a simple majority of the votes cast at the Meeting, excluding the votes cast by any holders of Company Shares that are required to be excluded in order to obtain “minority approval” pursuant to MI 61-101.

! Completion of the Arrangement will be subject to a judicial determination by the Court that the Arrangement is fair and reasonable.

! The Arrangement Agreement does not prevent a third party from making an unsolicited Acquisition Proposal. Subject to compliance with the terms of the Arrangement Agreement, the Board is not precluded from considering and responding to an unsolicited Acquisition Proposal that is, or could reasonably be expected to lead to, a Superior Proposal at any time prior to the approval of the Arrangement Resolution by Shareholders. In the event that a Superior Proposal is made and not matched by Parent, upon payment by Inter-Citic to Parent of the

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Termination Fee, the Arrangement Agreement may be terminated by Inter-Citic and Inter-Citic may enter into a definitive agreement with respect to the Superior Proposal. In supervising the negotiation of the Termination Fee, the Special Committee sought to negotiate a fee that would not be reasonably expected to preclude a third party from making an unsolicited Superior Proposal. In addition, the Voting Support Agreements will terminate automatically in the event of termination of the Arrangement Agreement.

! Registered Shareholders who do not vote in favour of the Arrangement will have the right under the CBCA to obtain “fair value” for their Company Shares pursuant to the proper exercise of Dissent Rights.

! In the event that Parent or Acquireco breaches any of their respective representations, warranties, or fails to fulfil or comply in all material respects with their respective covenants on or prior to the Effective Time, or Parent does not provide, or cause to be provided, sufficient funds in cash to complete the transactions contemplated by the Arrangement and the Arrangement Agreement, other than in the case where the failure or failures of all representations and warranties to be so true and correct would not reasonably be expected to materially impair or delay the consummation of the Arrangement, Parent must pay to Inter-Citic the Break-Up Fee in the amount equal to the Termination Fee.

The Special Committee also considered a number of risks and potential negative factors relating to the Arrangement, including the following:

! The risks to Inter-Citic of the Arrangement not being completed, including the costs to Inter-Citic in pursuing the Arrangement and the diversion of management attention away from the conduct of Inter-Citic’s business and the potential impact on Inter-Citic’s relationships with its employees, suppliers and partners, as well as the risk factors described under “Risk Factors Related to the Arrangement” in this Circular.

! The restrictions on the conduct of Inter-Citic’s business prior to completion of the Arrangement, which may delay or prevent Inter-Citic from conducting exploration on the Dachang Project and undertaking business opportunities that may arise pending completion of the Arrangement.

! The fact that, if the Arrangement is successfully completed, Inter-Citic will no longer exist as an independent public company and the consummation of the Arrangement will eliminate the opportunity for Shareholders to participate in the longer term potential benefits of the business of Inter-Citic to the extent that those benefits exceed those potential benefits reflected in the cash consideration to be received under the Arrangement.

! The conditions to Parent’s obligation to complete the Arrangement and the rights of Parent to terminate the Arrangement Agreement in certain circumstances, including if the Regulatory Approvals are not obtained by December 22, 2012.

! The fact that the Arrangement will be a taxable transaction for Canadian federal income tax purposes (and may also be a taxable transaction under other applicable tax laws) for certain Shareholders and, as a result, certain Shareholders will generally be required to pay taxes on any gains that result from

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the receipt of the consideration payable for their Company Shares under the Arrangement. See “Certain Canadian Federal Income Tax Considerations” in this Circular.

! The prohibition contained in the Arrangement Agreement on Inter-Citic’s ability to solicit Acquisition Proposals, as well as the fact that if the Arrangement Agreement is terminated in certain circumstances, Inter-Citic will be required to pay the Termination Fee to Parent.

! Even if the Arrangement Agreement is terminated without payment of the Termination Fee, Inter-Citic may, in the future, be required to pay the Termination Fee in certain circumstances where an Acquisition Proposal is entered into or consummated within nine months of the date on which an Acquisition Proposal is made (and not withdrawn) prior to the Meeting. Accordingly, if the Arrangement is not consummated and the Arrangement Agreement is terminated, Inter-Citic may not be able to consummate another Acquisition Proposal for a period of time without paying the Termination Fee.

The Special Committee is recommending the Arrangement based upon the totality of the information presented to and considered by it. The above discussion of the information and factors considered by the Special Committee is not intended to be exhaustive but is believed by the Special Committee to include the material factors considered by it in its assessment of the Arrangement. In view of the wide variety of factors considered by the Special Committee in connection with its assessment of the Arrangement, and the complexity of those matters, the Special Committee did not consider it practical, nor did it attempt, to quantify, rank or otherwise assign relative weights to the foregoing factors. In addition, in considering the factors described above, individual members of the Special Committee may have given different weights to various factors and may have applied different analyses to each of the material factors considered by the Special Committee.

Opinion of Standard Chartered

Standard Chartered acted as the exclusive financial advisor to Inter-Citic to assist and adviseInter-Citic in exploring financing alternatives and to evaluate potential strategic alternatives. On August 24, 2012, Standard Chartered delivered an oral opinion to the Special Committee and the Board, which was subsequently confirmed by delivery of a written opinion dated August 24, 2012, stating that, based upon and subject to the assumptions, qualifications and limitations set forth in the Standard Chartered Opinion, as of that date, the consideration for Company Shares to be received by the Shareholders in the Arrangement pursuant to the Arrangement Agreement was fair, from a financial point of view, to the Shareholders.

General Information Regarding the Standard Chartered Opinion

Standard Chartered provided the Standard Chartered Opinion solely for the information of and assistance to the Board (in its capacity as such) and the Special Committee, for purposes of the evaluation by the Special Committee and the Board of the Consideration to be received by the Shareholders pursuant to the Arrangement from a financial point of view. The Standard Chartered Opinion does not constitute, nor is it intended to constitute, any recommendation as to how the Shareholders should vote at the Meeting. In addition, the Standard Chartered Opinion does not address any other aspect of the Arrangement and no opinion was expressed as to the Arrangement (other than as to the fairness, from a financial point of view, of the Consideration to be received by the Shareholders) the relative merits of the Arrangement in comparison to other strategies or transactions that might be available to Inter-Citic or in which

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Inter-Citic might engage, or as to the underlying business decision of Inter-Citic to proceed with or effect the Arrangement.

The summary of the Standard Chartered Opinion in this Circular is qualified in its entirety by reference to the full text of the Standard Chartered Opinion. The full text of the Standard Chartered Opinion, which sets out, among other things, the assumptions made, information reviewed, matters considered and limitations on the scope of the review undertaken by Standard Chartered in rendering its opinion, is attached as Appendix D to this Circular. Shareholders are urged to read the Standard Chartered Opinion carefully and in its entirety.

Other than its engagement letter agreement, as amended, with Inter-Citic, there are no understandings, agreements or commitments between Standard Chartered and Inter-Citic, or any of their respective associates or affiliates, with respect to any future business dealings.

The Standard Chartered Group may in the future, in the ordinary course of business, perform financial advisory or investment banking services for Parent or any of their respective associates or affiliates for which services it or they would expect to receive compensation. The Standard Chartered Group comprises a full service international financial institution engaged in broker, dealer, investment advisory and investment banking services to a wide range of companies, governments and individuals. In the ordinary course of their businesses, the Standard Chartered Group may invest on a principal basis or on behalf of customers or manage funds that invest, make or hold long or short positions, finance positions or trade or otherwise effect transactions in equity, debt or other securities or financial instruments (including derivatives, bank loans or other obligations) of Inter-Citic.

The terms of Standard Chartered’s engagement letter agreement provide that Standard Chartered is to be paid a fixed fee (the “Opinion Fee”) upon delivery to Inter-Citic of the Standard Chartered opinion. If the Arrangement is completed, Standard Chartered will be paid an additional fee upon the completion of the Arrangement. If the Arrangement is not completed, and Inter-Citic or its affiliates are paid, granted or otherwise become entitled to any consideration in connection therewith, Standard Chartered will be entitled to a break-up fee which is payable upon Inter-Citic's receipt of such consideration. In addition, Standard Chartered is to be reimbursed for their reasonable out-of-pocket expenses and to be indemnified by Inter-Citic in certain circumstances.

The Standard Chartered Opinion was necessarily based on financial, economic, monetary, market and other conditions and circumstances as in effect on, and the information made available to Standard Chartered as of, the date of such Standard Chartered Opinion. Accordingly, although subsequent developments may affect the Standard Chartered Opinion, Standard Chartered does not have any obligation to update, revise or reaffirm its opinion. The Standard Chartered Opinion was one of a number of factors taken into consideration by the Board and the Special Committee, respectively, in connection with making their respective determinations that the Arrangement is in the best interests of Inter-Citic and, authorizing the entry by Inter-Citic into the Arrangement Agreement and all related agreements, and recommending that the Shareholders vote their Company Shares for the Arrangement Resolution.

Interests of Directors, Senior Officers and Others in the Arrangement

In considering the recommendations of the Special Committee and the Directors with respect to the Arrangement, Shareholders should be aware that certain of the Directors and senior officersof, and a consultant to, Inter-Citic may have actual or potential interests (as described below)

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that differ from and/or are in addition to, those of Shareholders generally. The Special Committee and the Directors were aware of these interests and considered them, along with other matters described in this Circular, in reaching their decision to approve the Arrangement and to recommend that the Shareholders vote for the Arrangement Resolution.

Ownership of Company Shares

As of the date of this Circular, the Directors and senior officers of Inter-Citic, and their respective associates and affiliates, beneficially own, or exercise control or direction over, directly or indirectly, in the aggregate, 1,012,385 Company Shares, which represent approximately 0.86% of the total issued and outstanding Company Shares. All Company Shares held by the Directors and senior officers of Inter-Citic, and their respective associates and affiliates, will be treated identically and in the same manner under the Arrangement as Company Shares held by any other Shareholder. Mr. Garth Pierce, a related party as defined in MI 61-101 and, a principal of BCLX Consulting Limited, a geographical consulting company that is a consultant to Inter-Citic,beneficially owns, or exercises control or direction over, directly or indirectly, 426,900 Company Shares, which represent approximately 0.36% of the total issued and outstanding Company Shares.

The following table sets out the names and positions of the Directors, senior officers and a consultant of Inter-Citic and, as of the date of this Circular, the number and percentage of Company Shares owned or over which control or direction is exercised, directly or indirectly, by each such Director, senior officer or consultant of Inter-Citic and, where known after reasonable enquiry, by their respective associates or affiliates, each other insider of Inter-Citic, each associate or affiliate of such other insider and each associate or affiliate of Inter-Citic:

Name Position with Inter-Citic Ownership of or control over Company Shares

% Ownership of Company Shares

James Moore Chief Executive Officer, President and Director

287,485 0.24

Lou Pasubio Chief Financial Officer and VP of China Operations and Finance

259,100 0.22

Malcolm Swallow Vice-President of Mine Development and Director

229,500 0.20

Stephen Lautens VP of Corporate Communications, Gen. Counsel and Secretary

81,300 0.07

Peter Joynt Director 25,000 0.02

Mark Frederick Chairman and Director - -

Michael Doggett Director 80,000 0.07

Carlos Ho Director - -

Adrian Ho Director - -

Donald Brown Director 50,000 0.04

Zhang Hongyi Director - -

Garth Pierce Consultant 426,900 0.36

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Ownership of Company Options

The Directors and senior officers of Inter-Citic beneficially own, or exercise control or direction over, directly or indirectly, in the aggregate, 6,842,826 Company Options as of the close of business on the date of this Circular. Mr. Garth Pierce beneficially owns, or exercises control or direction over, directly or indirectly, 1,100,000 Company Options as of the close of business on the date of this Circular. All of the Company Options held by the Directors, senior officers and consultants of Inter-Citic will be treated identically and in the same manner under the Arrangement as Company Options held by any other Optionholder.

The following table shows the total number of Company Options beneficially held by each of the Directors and senior officers of Inter-Citic and Mr. Pierce that are expected to be settled for cash upon the closing of the Arrangement in accordance with the Plan of Arrangement and the amounts to be paid for the same.

Name Position with Inter-Citic # Company Options Cash Payment($)

James Moore Chief Executive Officer 2,022,826 1,986,207

Lou Pasubio Chief Financial Officer and VP of China Operations and Finance

1,410,000 1,301,700

Malcolm Swallow Vice-President of Mine Development and Director

660,000 367,600

Stephen Lautens VP of Corporate Communications, Gen. Counsel and Secretary

550,000 373,500

Peter Joynt Director 400,000 337,500

Mark Frederick Chairman and Director 400,000 549,500

Michael Doggett Director 400,000 243,000

Carlos Ho Director 350,000 310,500

Adrian Ho Director 250,000 296,500

Don Brown Director 200,000 263,000

Zhang Hongyi Director 200,000 217,500

Garth Pierce Consultant 1,100,000 896,000

“Change of Control” Provisions

Inter-Citic has previously entered into a written employment contract with Mr. James Moore (“Moore Employment Agreement”), the President and Chief Executive Officer of Inter-Citic, with Mr. Lou Pasubio (“Pasubio Employment Agreement”), the Chief Financial Officer of Inter-Citic, and with Mr. Charles Park (“Park Employment Agreement”), Director of Finance of Inter-Citic.

The Moore Employment Agreement provides that if there is a change in control of Inter-Citicresulting in the resignation of Mr. Moore, he shall be entitled to receive a lump sum equal to twenty-four (24) times his base monthly salary. Additionally, if he elects within thirty (30) days of the change of control to resign from Inter-Citic, he shall receive a pro rata share of his average annual bonus over the last three years. The total amount to be paid to Mr. Moore in the event of a change in control of Inter-Citic is approximately $1,013,000, of which $283,670 is his proportionate bonus.

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The Pasubio Employment Agreement provides that if there is a change in control of Inter-Citicresulting in the resignation of Mr. Pasubio, he shall be entitled to receive a lump sum equal to twenty-four (24) times his base monthly salary. Additionally, if he elects within thirty (30) days of the change of control to resign from Inter-Citic, he shall receive a pro rata share of his average annual bonus over the last three years. The total amount to be paid to Mr. Pasubio in the event of a change in control of Inter-Citic is approximately $715,000 of which $216,670 is his proportionate bonus.

The Park Employment Agreement provides that if there is a change in control of Inter-Citic resulting in the resignation of Mr. Park, he shall be entitled to receive a lump sum equal to twelve (12) times his base monthly salary. The total amount to be paid to Mr. Park in the event of a change in control of Inter-Citic is approximately $147,000.

For the purposes of disclosure regarding the Moore Employment Agreement, the Pasubio Employment Agreement and the Park Employment Agreement, “change of control” generally means the acquisition of Company Shares, or shares convertible into Company Shares of Inter-Citic entitling the holders thereof to cast more than 20% of the votes attached to all CompanyShares of Inter-Citic; or the sale or lease of substantially all of the assets of Inter-Citic; or the merger or amalgamation with another corporation; or the Company Shares of Inter-Citic being converted into those of another entity, or exchanged for consideration; or the replacement of three or more incumbent Directors on the Board, and the completion of the Arrangement would constitute a change of control.

For details of the aggregate amounts of compensation, including benefits, which the relevant senior officers of Inter-Citic would have received assuming their employment had been terminated without “cause” or they had resigned following a change of control of Inter-Citic, please refer to the “COC Benefit” column of the summary table set out under the heading “Principal Legal Matters — Canadian Securities Law Considerations — Special Transaction Rules” in this Circular.

Particulars of the Arrangement

The Arrangement is an arrangement under Section 192 of the CBCA. It will become effective at the Effective Time and will become binding at and after such time on Inter-Citic, Parent, Acquireco, all registered and beneficial holders of Company Shares (including any Dissenting Shareholders), all Optionholders and Warrantholders, the Transfer Agent and the Depositary. The Plan of Arrangement sets out a series of transactions and steps that will occur starting at the Effective Time as a result of which, among other things, Acquireco will acquire all of Company Shares for consideration of $2.05 in cash per share. See “The Arrangement—Arrangement Mechanics” in this Circular.

Assuming the conditions set out in the Arrangement Agreement have been satisfied or, where permitted, waived, upon obtaining the Final Order, Inter-Citic intends to file the Articles of Arrangement with the CBCA Director as soon as reasonably practicable thereafter, at which time the Arrangement will become effective as at the Effective Time. As a result of the completion of the Arrangement, Shareholders will no longer have an ownership interest in Inter-Citic on completion of the Arrangement. Shortly after such completion, Company Shares will cease to be listed on the TSX and trading of Company Shares in the public market will no longer be possible. In addition, Parent is expected to seek to have Inter-Citic be deemed to cease being a reporting issuer under Canadian Securities Laws. Upon ceasing to be a reporting issuer in Canada, Inter-Citic will, among other things, no longer be required to file continuous disclosure documents with Canadian Securities Administrators. In the event that the Arrangement does not proceed for any reason, including because it does not receive the

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requisite Shareholder approvals, Court approval or Regulatory Approvals, Inter-Citic will continue operating as a publicly held company.

For a discussion of certain Canadian federal income tax considerations relating to the disposition of Company Shares, please see “Certain Canadian Federal Income Tax Considerations” in this Circular.

Shareholder Approvals

At the Meeting, Shareholders will be asked to vote to approve the Arrangement Resolution. Pursuant to the Interim Order, and subject to any further order of the Court, the Arrangement Resolution must be approved by the affirmative vote of at least 66⅔% of the votes cast by Shareholders present in person or represented by proxy at the Meeting and entitled to vote at the Meeting. In addition, as the Arrangement constitutes a “business combination” pursuant to MI 61-101, the Arrangement Resolution must be approved by a simple majority of the votes cast at the Meeting, excluding the votes cast by any holders of Company Shares that are required to be excluded in order to obtain “minority approval” pursuant to MI 61-101. To the knowledge of Inter-Citic after reasonable inquiry, 287,485 Company Shares held by Mr. James Moore, the President and Chief Executive Officer of Inter-Citic, 259,100 Company Shares held by Mr. Lou Pasubio, the Vice-President, Finance and Chief Financial Officer of Inter-Citic, and 426,900Company Shares held by Mr. Garth Pierce, the principal of BCLX Consulting Limited, a consultant to Inter-Citic, will be excluded in determining whether minority approval for the Arrangement Resolution has been obtained. See “Principal Legal Matters — Canadian Securities Law Considerations” in this Circular.

The Arrangement Resolution must receive the Required Arrangement Vote in order for Inter-Citic to seek the Final Order and implement the Arrangement on the Effective Date in accordance with the Final Order. Notwithstanding the approval by Shareholders of the Arrangement Resolution, Inter-Citic reserves the right not to proceed with the Arrangement, subject to and in accordance with the terms of the Arrangement Agreement and the Plan of Arrangement.

Arrangement Mechanics

Plan of Arrangement

The following description is qualified in its entirety by reference to the full text of the Plan of Arrangement, which is attached as Appendix C to this Circular.

The Arrangement contemplates, among other things, the acquisition of Inter-Citic by Parent, through its indirect wholly-owned Canadian subsidiary, Acquireco, by way of a plan of arrangement under Section 192 of the CBCA. The Plan of Arrangement provides that, commencing at the Effective Time, the following shall occur and shall be deemed to occur sequentially, in the following order, without any further act or formality on the part of any person, in each case effective as at one minute intervals starting at the Effective Time:

(a) notwithstanding the terms of the Rights Plan, the Rights Plan shall be terminated and all rights issued pursuant to the Rights Plan shall be cancelled without any payment in respect thereof;

(b) each Company Option outstanding immediately prior to the Effective Time (whether vested or unvested), notwithstanding the terms of the Stock Option

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Plan, shall be deemed to be unconditionally vested and exercisable, and such Company Option shall:

(i) without any further action by or on behalf of the holder of such option, be assigned and transferred by such holder to Inter-Citic in exchange for a cash payment from Inter-Citic equal to the amount (if any) by which the Consideration exceeds the exercise price thereof, less any withholdings or deductions in respect of taxes and other amounts required to be withheld or deducted therefrom under any applicable Laws; and

(ii) immediately be cancelled and all agreements related thereto shall be terminated, and the holder of such option shall thereafter have only the right to receive the consideration to which such holder is entitled pursuant to the Plan of Arrangement, at the time and in the manner specified in Article 5 of the Plan of Arrangement;

(c) each Warrant outstanding immediately prior to the Effective Time shall be transferred to Acquireco in exchange for a cash payment by Acquireco equal to the amount (if any) by which the Consideration exceeds the exercise price for such Warrant, less any withholdings or deductions in respect of taxes and other amounts required to be withheld or deducted therefrom under any applicable Laws;

(d) each Dissent Share shall be transferred by the holder of such share, free and clear of all Liens, to Acquireco in accordance with Article 4 of the Plan of Arrangement;

(e) each Company Share outstanding at the Effective Time, other than any Dissent Shares and any Company Shares held by, if applicable, Parent, Acquireco or any of their respective affiliates (which Company Shares, if any, shall not be exchanged under the Arrangement but shall remain outstanding as Company Shares held by Parent, Acquireco or such affiliate), shall be deemed to be transferred by the holder of such Company Share, free and clear of any Liens, to Acquireco, and such holder shall be entitled to receive in exchange therefor from Acquireco the Consideration for each Company Share held; and

(f) the names of the holders of Company Shares or Dissent Shares, as the case may be, transferred to Acquireco shall be removed from the applicable registers of holders of Company Shares, and Acquireco shall be recorded as the registered holder of Company Shares and Dissent Shares so transferred and shall be deemed the legal and beneficial owner of such shares, free and clear of any Liens.

If the Required Arrangement Vote is obtained, the Final Order is granted and all other conditions under the Arrangement Agreement are satisfied or, where permitted, waived, the Articles of Arrangement will be filed with the CBCA Director as soon as reasonably practicable thereafter. Upon the issuance of the Certificate of Arrangement, the Plan of Arrangement will become effective at the Effective Time and will be binding at and after such time on Inter-Citic, Parent, Acquireco, all registered and beneficial holders of Company Shares (including any Dissenting Shareholders), all Optionholders and Warrantholders, the Transfer Agent and the Depositary.

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Amendments

Inter-Citic and Parent may mutually agree to amend, modify or supplement the Plan of Arrangement at any time and from time to time prior to the Effective Date, provided that each such amendment, modification or supplement must be in writing, be filed with the Court and, if made following the Meeting, approved by the Court and, if and as required by the Court, communicated to Shareholders and such other persons as the Court may so require. See also “The Arrangement Agreement — Amendment” in this Circular.

Sources of Funds for the Arrangement

Assuming no Shareholders exercise their Dissent Rights and 117,573,645 Company Shares are outstanding at the Effective Time:

(a) approximately $241,241,222 will be required by Parent to fund the Consideration for Acquireco’s acquisition of all of the outstanding Company Shares under the Plan of Arrangement;

(b) approximately $7,780,706 will be required to fund Inter-Citic’s payments in respect of the outstanding Company Options under the Plan of Arrangement; and

(c) approximately $276,316 will be required to fund the acquisition of Warrants by Acquireco.

Parent will indirectly fund the aggregate cash payable by Acquireco for Company Shares and Warrants under the Arrangement from its cash on hand and with proceeds from a loan with its bank in PRC. Parent will loan approximately $7,780,706 to Inter-Citic to make the cash payments for all of the outstanding Company Options pursuant to the Plan of Arrangement.

Voting Support Agreements

The Voting Support Agreements have been filed on SEDAR and are available at www.sedar.com. The following is only a summary of certain material terms of the Voting Support Agreements, which does not contain all of the information about these agreements. Accordingly, the following is qualified in its entirety by reference to the full text of each of the Voting Support Agreements.

Contemporaneously with the execution of the Arrangement Agreement by Inter-Citic, Parent and Acquireco, each of the Directors and two senior officers, entered into Voting Support Agreements with Parent pursuant to which they agreed, upon the terms and subject to the conditions contained in their respective Voting Support Agreements, to, among other things, vote all Company Shares held by them at any meeting of Shareholders and in any action by written consent of Shareholders (a) in favour of the Arrangement, the other transactions contemplated by the Arrangement Agreement and the Plan of Arrangement and any actions required in furtherance of the Arrangement; and (b) against any action that is intended or would reasonably be expected to impede, interfere with, delay such transactions.

Pursuant to the Voting Support Agreements, each of the Directors also agreed not to (a) option, sell, transfer, gift, assign, pledge, hypothecate, encumber or otherwise dispose of any of his or its respective Company Shares or Company Options, or (b) except as contemplated by the Voting Support Agreements, grant (or permit to be granted) any proxies or deposit (or permit to be deposited) such Company Shares and Company Options into a voting trust or enter into a voting support agreement, understanding or arrangement with respect to the voting of suchCompany Shares and Company Options. In addition, pursuant to the Arrangement Agreement,

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each of the Directors agreed to cease any discussions or negotiations with respect to an Acquisition Proposal and not to, directly or indirectly, negotiate or discuss with, encourage, solicit, facilitate, or initiate, directly or indirectly, submission of proposals or offers from, or provide information to, any other person, entity or group relating to an Acquisition Proposal or any Company Shares or Company Options, or otherwise co-operate in or knowingly facilitate any effort or attempt to make, implement or accept any proposal or offer that constitutes, or may reasonably be expected to lead to, any Acquisition Proposal or enter into any agreement relating to any Acquisition Proposal. Each of the Directors also covenanted not to exercise any Dissent Rights and to waive any rights of dissent and appraisal that may arise out of the Arrangement.

The Voting Support Agreements will terminate and be of no further force or effect on the earlier of (a) the Effective Date, and (b) the termination of the Arrangement Agreement by Parent or Inter-Citic, (c) the date, if any, upon which the Arrangement Agreement is amended in any manner to provide for less Consideration in the Arrangement than is provided for at the date of this Agreement; and (d) the Outside Date.

Parent, when not in default in the performance of its obligations under the Voting Support Agreements, may terminate the Voting Support Agreements at any time and without prejudice to any other rights it may have under the Voting Support Agreements or otherwise, by notice in writing.

In discussions with Zijin Mining’s management, it has been indicated to management of Inter-Citic that Zijin Mining will not oppose the Arrangement.

Expenses of the Arrangement

The aggregate costs paid or incurred, or to be paid or incurred, by Inter-Citic in connection with the Arrangement, including (without limitation) fees and expenses of legal counsel and accountants, audit fees, the maximum amount of commissions, fees and expenses payable to its financial advisor, and the premium for the extension of the existing Directors’ and officers’ liability insurance coverage, are not expected to exceed $6 million. See also “The Arrangement Agreement — Termination Fee, Break-Up Fee and Expenses — Expenses” in this Circular.

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THE ARRANGEMENT AGREEMENT

The following is a summary of certain material terms of the Arrangement Agreement, a copy of which is attached as Appendix B to this Circular. This summary does not contain all of the information about the Arrangement, and is qualified in its entirety by the text of the Arrangement Agreement. Therefore, Shareholders should read the Arrangement Agreement carefully and in its entirety, as the rights and obligations of Inter-Citic, Parent and Acquireco are governed by the express terms of the Arrangement Agreement and not by this summary or any other information contained in this Circular.

The Arrangement Agreement contains representations and warranties made by Inter-Citic, Parent and Acquireco. These representations and warranties, which are set forth in the Arrangement Agreement, were made by and to the Parties thereto for the purposes of the Arrangement Agreement (and not to other persons such as Shareholders) and are subject to qualifications and limitations agreed to by the Parties in connection with negotiating and entering into the Arrangement Agreement. In addition, these representations and warranties were made as of specified dates, may be subject to a contractual standard of materiality different from what may be viewed as material to Shareholders, may be qualified by knowledge of certain officers of Inter-Citic, or may have been used for the purpose of allocating risk between the Parties instead of establishing such matters as facts. Moreover, information concerning the subject matter of the representations and warranties, which do not purport to be accurate as of the date of this Circular, may have changed since the date of the Arrangement Agreement.

On August 24, 2012, Inter-Citic, Parent and Acquireco entered into the Arrangement Agreement, under which they agreed, among other things, that, upon the terms and subject to the conditions set forth in the Arrangement Agreement, Acquireco will acquire all of the issued and outstanding Company Shares as part of and in accordance with the Plan of Arrangement, whereby Shareholders (other than Dissenting Shareholders, if any) will receive $2.05 in cash, without interest and subject to applicable withholdings, for each Company Share held. The terms of the Arrangement Agreement are the result of arm’s length negotiations conducted between Inter-Citic, Parent and Acquireco and their respective advisors.

For a summary of the provisions of the Plan of Arrangement relating to the mechanics of implementing the Arrangement, see “The Arrangement — Arrangement Mechanics” in this Circular.

Conditions Precedent to the Arrangement

Mutual Conditions Precedent

The Arrangement Agreement provides that the respective obligations of the Parties to complete the Arrangement are subject to the fulfilment or waiver, on or before the Effective Time, of each of the following conditions precedent, each of which may only be waived in whole or in part with the mutual consent of Inter-Citic, Parent and Acquireco:

(1) the Arrangement Resolution will have been approved and adopted at the Meeting in accordance with the Interim Order;

(2) the Interim Order and the Final Order will each have been obtained in form and on terms consistent with the Arrangement Agreement, and will not have been set aside or modified in a manner unacceptable to either Inter-Citic or Parent, each acting reasonably, on appeal or otherwise;

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(3) all Regulatory Approvals shall have been obtained on terms satisfactory to the Partiesand each Regulatory Approval is in force and has not been modified (except where modified to the satisfaction of each of the Parties);

(4) no Law is or will be in effect that makes the consummation of the Arrangement illegal or otherwise prohibits or enjoins Inter-Citic or Parent from consummating the Arrangement; and

(5) the Arrangement Agreement will not have been terminated in accordance with its terms.

Parent and Acquireco Conditions Precedent

Parent and Acquireco are not required to complete the Arrangement unless each of the following conditions is satisfied on or before the Effective Time, which conditions are for the exclusive benefit of Parent and Acquireco and may only be waived, in whole or in part, by them in their sole discretion:

(1) all representations and warranties of Inter-Citic under the Arrangement Agreement shall be true and correct (without regard to any materiality or Material Adverse Effect qualifications contained in them) as of the Effective Date, as though made on and as of the Effective Date (other than the representations and warranties made as of a specified date, the accuracy of which shall be determined as of that specified date), except where the failure or failures of all such representations and warranties to be so true and correct would not reasonably be expected to have a Material Adverse Effect;

(2) Inter-Citic has fulfilled or complied in all material respects with each of the covenants of Inter-Citic contained in the Arrangement Agreement to be fulfilled or complied with by it on or prior to the Effective Time;

(3) there is no action or proceeding pending or threatened by any person in any jurisdiction to:

(a) cease trade, enjoin, prohibit, or impose any limitations, damages or conditions on Parent’s and Acquireco’s ability to acquire, hold, or exercise full rights of ownership over, Company Shares, including the right to vote Company Shares;

(b) prohibit or restrict the Arrangement, or the ownership or operation by Parent or Acquireco of the business or assets of Inter-Citic or its affiliates, or compel Parent or Acquireco to dispose of or hold separate any material portion of the business or assets of Parent, Acquireco, Inter-Citic or any of its affiliates as a result of the Arrangement; or

(c) prevent or materially delay the consummation of the Arrangement, or if the Arrangement is consummated, have a Material Adverse Effect;

(4) Dissent Rights have not been exercised with respect to more than 5% of the issued and outstanding Company Shares;

(5) the SRP Rights have been redeemed or terminated, and none of the SRP Rights shall have been exercised or become exercisable and no Company Shares shall have been issued from the exercise of SRP Rights;

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(6) no Material Adverse Effect shall have occurred that has not been publicly disclosed by Inter-Citic prior to the date hereof, and since August 24, 2012, there shall not have occurred a Material Adverse Effect;

(7) there shall not have been any breach of any of the Voting Support Agreements by any party to any such agreement other than Parent or Acquireco that materially adversely affects the completion of the Arrangement;

(8) Inter-Citic shall have received resignations effective immediately following the Effective Time from each of its Directors and senior officers.

Inter-Citic Conditions Precedent

Inter-Citic is not required to complete the Arrangement unless each of the following conditions is satisfied on or before the Effective Time, which conditions are for the exclusive benefit of Inter-Citic and may only be waived, in whole or in part, by Inter-Citic in its sole discretion:

(1) all representations and warranties of Parent and Acquireco under the Arrangement Agreement shall be true and correct (without regard to any materiality qualifications contained in them) as of the Effective Date, as though made on and as of the EffectiveDate (other than the representations and warranties made as of a specified date, the accuracy of which shall be determined as of that specified date), except where the failure or failures of all such representations and warranties to be so true and correct in all respects would not reasonably be expected to materially impair or delay the consummation of the Arrangement;

(2) Parent and Acquireco have fulfilled or complied in all material respects with their covenants contained in the Arrangement Agreement to be fulfilled or complied with them on or prior to the Effective Time;

(3) Parent shall have provided or caused to be provided to the Depositary, Inter-Citic and Acquireco, sufficient funds in cash to complete the transactions contemplated by the Arrangement and the Arrangement Agreement.

Representations and Warranties

The Arrangement Agreement contains customary representations and warranties on the part of Inter-Citic relating to: organization and qualification; authority; no conflict; governmental approvals; Competition Act; Investment Canada Act; fairness opinion; subsidiaries; status of Joint Venture; regulatory filings; compliance with Laws; Company authorizations; capitalization and listing; Rights Plan, Zijin rights; Shareholder and similar agreements; Financial Statements; undisclosed liabilities; exploration licenses; mineral resources; technical data; project matters; employment matters; absence of certain changes or events; litigation; Taxes; books and records; insurance; non-arm’s length transactions; Foreign Corrupt Practices Laws; environmental; Material Contracts; Joint Venture Agreement; brokers; reporting issuer status; stock exchange compliance; no expropriation; and Board recommendation.

The assertions embodied in Inter-Citic’s representations and warranties are qualified by information contained in the Disclosure Letter that Inter-Citic delivered to Parent and Acquireco in connection with the execution of the Arrangement Agreement. While Inter-Citic does not believe that the Disclosure Letter contains material information that Inter-Citic is required to disclose publicly, other than information that has already been so disclosed by Inter-Citic, the Disclosure Letter does contain information that modifies, qualifies and creates exceptions to the

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representations and warranties set forth in the Arrangement Agreement, including certain non-public information. Accordingly, you should not rely on the representations and warranties in the Arrangement Agreement as characterizations of the actual state of facts, since they are modified in part by the Disclosure Letter. Moreover, information concerning the subject matter of such representations and warranties may have changed since the date of the Arrangement Agreement and the representations and warranties will not reflect any such subsequent changes in facts. In addition, some of Inter-Citic’s representations and warranties are qualified by the knowledge of certain officers of Inter-Citic.

Further, the Arrangement Agreement includes certain customary representations and warranties of Parent and Acquireco, relating to: organization; authority; no violation; enforceability; no breach; consents and approvals; litigation; financing; escrow; Regulatory Approvals; and Security ownership. See “The Arrangement Agreement — Representations and Warranties” in this Circular.

The representations and warranties of the Parties to the Arrangement Agreement will not survive the completion of the Arrangement.

Covenants of Inter-Citic

Covenants Regarding Conduct of Business

In the Arrangement Agreement, Inter-Citic agreed to certain customary negative and affirmative covenants relating to the operation of its business between the date of the Arrangement Agreement and until the earlier of the Effective Time and (if applicable) the time that the Arrangement Agreement is terminated in accordance with its terms. In particular, Inter-Citic agreed that, unless Parent otherwise agrees in writing, such agreement not to be unreasonably withheld or delayed, or as is otherwise expressly permitted or specifically contemplated by the Arrangement Agreement or the Plan of Arrangement or set forth in the Disclosure Letter, or as is otherwise required by applicable Law or Governmental Entity:

(1) Inter-Citic shall conduct business only in the Ordinary Course and shall conduct the activities of Dachang Project only in the Ordinary Course, with any activities outside of the Ordinary Course requiring the prior written consent of Parent, such consent not to be unreasonably withheld or delayed, provided that Parent acknowledges that Inter-Citic has not conducted any exploration activities at the Dachang Project since December 2011 and Inter-Citic will not do so prior to the Effective Time.

(2) Inter-Citic shall use commercially reasonable efforts to preserve intact the current business organization of Inter-Citic, keep available the services of the present employees and agents of Inter-Citic and maintain satisfactory relations with, and the goodwill of, suppliers, customers, landlords, creditors, distributors, Governmental Entities and all other Persons having business relationships with Inter-Citic, and Inter-Citic shall not, and shall not permit any of its affiliates to, directly or indirectly:

(a) amend its constating documents or, in the case of any affiliate which is not a corporation, its similar organizational documents;

(b) amend, modify or supplement the Joint Venture Agreement;

(c) split, combine or reclassify any shares of Inter-Citic or declare, set aside or pay any dividend or other distribution (whether in cash, stock or property or any combination thereof);

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(d) redeem, repurchase, or otherwise acquire or offer to redeem, repurchase or otherwise acquire any shares of capital stock of Inter-Citic or any of its affiliates;

(e) other than as set forth in the Disclosure Letter, issue, deliver or sell, or authorize the issuance, delivery or sale of any shares of capital stock, any options, warrants or similar rights exercisable or exchangeable for or convertible into such capital stock of Inter-Citic or any of its affiliates, except for the issuance of Company Shares issuable upon the exercise of the currently outstanding Company Options and Warrants;

(f) acquire (by merger, consolidation, acquisition of stock or assets or otherwise), directly or indirectly, in one transaction or in a series of related transactions, assets, securities, properties, interests or businesses;

(g) sell, lease, transfer or otherwise dispose of any of the assets of Inter-Citic or its affiliates except for assets which are obsolete and which individually or in the aggregate do not exceed $200,000;

(h) make any payment for any liability or obligation or otherwise, other than, (i) in the Ordinary Course, (ii) in accordance with the “Company Budget” as set forth in theDisclosure Letter, (iii) expenses or payments related to the Arrangement, including all professional fees, (iv) payment of amounts in respect of any employee termination payments related to termination of employees as set out in the Disclosure Letter, and (v) any payments that may be required on or following the Effective Date under existing employment agreements between Inter-Citic and certain officers of Inter-Citic due to a change of control as set out in the Disclosure Letter, all such amounts in (v) of this paragraph or such amounts in respect of severance payable to such other employees to be terminated at the Effective Time to be paid to the employee or deposited for the benefit of such employee prior to the Effective Date with a trustee or depositary to be selected by Inter-Citic. In the event that Inter-Citic has extraordinary obligations not otherwise permitted under the Arrangement Agreement, Inter-Citic must seek the approval of the Parent to allow it to pay such obligations, which approval will not be unnecessarily withheld or delayed.

(i) prepay any indebtedness before its scheduled maturity or increase, create, incur, assume or otherwise become liable for any indebtedness for borrowed money or guarantees thereof;

(j) make any loan or advance to, or any capital contribution or investment in, or assume, guarantee or otherwise become liable with respect to the liabilities or obligations of, any Person except for expense advances to Inter-Citic’s employees or consultants;

(k) enter into any interest rate, currency, equity or commodity swaps, hedges, derivatives, forward sales contracts or similar financial instruments;

(l) make any bonus or profit sharing distribution or similar payment of any kind;

(m) make any change in Inter-Citic’s methods of accounting except as required under Canadian GAAP or IFRS or applicable Laws;

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(n) grant any general increase in the rate of wages, salaries, bonuses or other remuneration to any of the employees of Inter-Citic;

(o) (i) increase any severance, change of control or termination pay to (or amend any existing arrangement with) any employee of Inter-Citic, Director or senior officer or any of its affiliates; (ii) increase the benefits payable under any existing severance or termination pay policies with any employee of Inter-Citic, Director or senior officer of Inter-Citic or any of its affiliates; (iii) increase the benefits payable under any employment agreements with any employee of Inter-Citic, Director or senior officer of Inter-Citic or any of its affiliates; (iv) enter into any employment, deferred compensation or other similar agreement (or amend any such existing agreement) with any Director or senior officer of Inter-Citic; or (v) increase compensation, bonus levels or other benefits payable to any Director or senior officer of Inter-Citic or to any employee of Inter-Citic (other than, in the case of each Director, a $25,000 retirement bonus to be paid to each Director of Inter-Citic on or before the Effective Date), in the case of an employee of Inter-Citic who is not a Director or senior officer of Inter-Citic, in a manner consistent with past practice;

(p) cancel, waive, release, assign, settle or compromise any material claims or rights;

(q) compromise or settle any litigation, proceeding or governmental investigation;

(r) amend or modify or terminate or waive any right under any Material Contract or enter into any contract or agreement that would be a Material Contract if in effect on the date hereof;

(s) amend, modify or terminate any material insurance policy of Inter-Citic or any affiliate in effect on the date of the Arrangement Agreement;

(t) authorize, agree, resolve or otherwise commit, whether or not in writing, to do any of the foregoing;

(u) abandon or fail to diligently pursue any application for any material licences, permits, authorizations or registrations;

(v) make, change or revoke any material Tax election or settle or compromise any material Tax liability;

(w) knowingly take any action or enter into any transaction, other than a transaction contemplated by the Arrangement Agreement, without the consent of Parent, or a transaction undertaken in the Ordinary Course, that could reasonably be expected to have the effect of materially reducing or eliminating the amount of the tax cost “bump” pursuant to paragraphs 88(1)(c) and (d) of the Tax Act otherwise available to Acquireco and its successors in respect of the non-depreciable capital properties owned by Inter-Citic and its subsidiaries as of August 24, 2012 or acquired by such entities subsequent to the date of the Arrangement Agreement in accordance with the terms of the Arrangement Agreement, without first consulting with Parent and Inter-Citic; and Inter-Citic will use its best reasonable efforts to address the reasonable concerns of Parent in regards to such provisions prior to taking or allowing a subsidiary to take such action or effect such transaction.

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Covenants Regarding Arrangement

Inter-Citic further agreed that it shall use its commercially reasonable efforts to take or cause to be taken all actions and to do or cause to be done all things necessary, proper or advisable under Law to consummate the Arrangement as soon as practicable, including:

(1) using its reasonable commercial efforts to obtain and maintain all third party or other consents, waivers, permits, exemptions, orders, approvals, agreements, amendments or confirmations that are required (A) in connection with the Arrangement or (B) in order to maintain the Material Contracts in full force and effect following completion of the Arrangement, in each case, without committing itself or Parent to pay, any consideration or incur any liability or obligation without the prior written consent of Parent (not to be unreasonably withheld or delayed);

(2) using its reasonable commercial efforts to, on prior written approval of Parent (not to be unreasonably withheld), oppose, lift or rescind any injunction, restraining or other order, decree or ruling seeking to restrain, enjoin or otherwise prohibit or adversely affect the consummation of the Arrangement and defend, or cause to be defended, any proceedings to which it is a party or brought against it or its directors or officers challenging the Arrangement or the Arrangement Agreement;

(3) carrying out the terms of the Interim Order and the Final Order applicable to it and complying promptly with all requirements imposed by Law on it or its Subsidiaries with respect to the Arrangement Agreement or the Arrangement;

(4) not taking any action, or refraining from taking any commercially reasonable action, or permitting any action to be taken or not taken, which is inconsistent with the Arrangement Agreement or which would reasonably be expected to prevent, delay or otherwise impede the consummation of the Arrangement;

(5) promptly advise Parent in writing of any material breach by Inter-Citic of any covenant, obligation or agreement contained in the Arrangement Agreement; and

(6) use reasonable commercial efforts to satisfy, or cause to be satisfied, all conditions precedent in the Arrangement Agreement that are in its power to satisfy.

Except as prohibited by applicable Law or any Material Contract, Inter-Citic shall promptly notify Parent of:

(1) any Material Adverse Effect or any change, effect, event, development, occurrence, circumstance or state of facts which could be expected to have a Material Adverse Effect, provided that the foregoing shall be subject to Inter-Citic’s overriding obligation to make any disclosure or filing required under applicable Securities Laws;

(2) any notice or other communication from any person (other than a Governmental Entity) alleging that the consent (or waiver, permit, exemption, order, approval, agreement, amendment or confirmation) of such Person is required in connection with the Arrangement Agreement or the Arrangement;

(3) any notice or other communication from any Governmental Entity in connection with the Arrangement (and contemporaneously provide a copy of any such written notice or communication to Parent); or

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(4) any filing, actions, suits, claims, investigations or proceedings commenced or, to its knowledge, threatened against, relating to or involving or otherwise affecting Inter-Citic, the Arrangement Agreement or the Arrangement.

Covenants of Parent and Acquireco

Parent agreed that Parent shall, and Parent shall cause its Subsidiaries to, perform all obligations required or desirable to be performed by Parent or any of Parent’s Subsidiaries under the Arrangement Agreement, co-operate with Inter-Citic in connection therewith, and do all such other acts and things as may be necessary or desirable in order to consummate and make effective, as soon as reasonably practicable, the transactions contemplated in the Arrangement Agreement and, without limiting the generality of the foregoing, Parent shall and where appropriate shall cause its Subsidiaries to:

(1) apply for and use its best efforts to obtain all Regulatory Approvals relating to Parent or any of Parent’s affiliates which are required in order to consummate the Arrangement and, in doing so, keep Inter-Citic regularly informed in writing (not less than weekly) as to the status of the proceedings related to obtaining such Regulatory Approvals, including providing Inter-Citic with copies of all related applications and notifications excluding any part thereof constituting confidential information, in draft form, in order for Inter-Citic to provide its reasonable comments thereon;

(2) use all its reasonable commercial efforts to assist Inter-Citic in obtaining all third party or other consents, waivers, permits, exemptions, orders, approvals, agreements, amendments or confirmations that are required (A) in connection with the Arrangement or (B) required in order to maintain the Material Contracts in full force and effect following completion of the Arrangement, provided Parent shall not be obligated to pay any fees or guarantee any obligations in connection with Inter-Citic obtaining such consents, waivers, permits, exemptions, orders, approvals, agreements, amendments or confirmations that are required;

(3) defend all lawsuits or other legal, regulatory or other proceedings against Parent challenging or affecting the Arrangement Agreement or the Arrangement;

(4) carry out the terms of the Interim Order and the Final Order applicable to it and complying promptly with all requirements imposed by Law on it or its Subsidiaries with respect to the Arrangement Agreement or the Arrangement;

(5) not take any action, or refrain from taking any commercially reasonable action, or permit any action to be taken or not taken, which is inconsistent with the ArrangementAgreement or which would reasonably be expected to prevent, delay or otherwise impede the consummation of the Arrangement;

(6) promptly advise Inter-Citic in writing of any material breach by Parent or Acquireco of any covenant, obligation or agreement contained in the Arrangement Agreement; and

(7) use its reasonable commercial efforts to satisfy, or cause to be satisfied, all conditions precedent in the Arrangement Agreement that are in its power to satisfy.

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Non-Solicitation Obligations of Inter-Citic

Non-Solicitation of Acquisition Proposals

The Arrangement Agreement provides that Inter-Citic shall not, directly or indirectly, through any officer, Director, employee, representative (including any financial or other adviser) or agent of Inter-Citic or of any of its affiliates (collectively “Representatives”), and shall not permit any such Person to:

(1) solicit, assist, initiate, encourage or otherwise facilitate (including by way of furnishing or providing copies of, access to, or disclosure of, any confidential information, properties, facilities, books or records of Inter-Citic or any affiliate or entering into any form of agreement, arrangement or understanding, other than a confidentiality agreement) any inquiry, proposal or offer that constitutes or may reasonably be expected to constitute or lead to, an Acquisition Proposal;

(2) enter into or otherwise engage or participate in any discussions or negotiations with any Person (other than Parent and its affiliates) regarding any inquiry, proposal or offer that constitutes or could be expected to constitute or lead to, an Acquisition Proposal, provided that Inter-Citic may: (A) advise any persons requesting access to non-public information relating to Inter-Citic that such access cannot be provided unless such person makes an Acquisition Proposal; and (B) advise any person making an unsolicited Acquisition Proposal that such Acquisition Proposal does not constitute or could not reasonably be expected to lead to a Superior Proposal if the Board has so determined;

(3) make a Change in Recommendation;

(4) accept, approve, endorse or recommend, or publicly propose to accept, approve, endorse or recommend, or publicly take no position or remain neutral with respect to, any Acquisition Proposal (it being understood and agreed that publicly taking no position or a neutral position with respect to an Acquisition Proposal for a period of no more than 7 business days following the announcement of such Acquisition Proposal will not constitute a violation of this provision); or

(5) accept or enter into or publicly propose to enter into any agreement, arrangement or understanding in respect of an Acquisition Proposal (other than a confidentiality agreement as contemplated in the Arrangement Agreement);

Termination of Existing Discussions and Information Exchange

As of August 24, 2012, Inter-Citic shall have, and shall have caused its affiliates and its Representatives to, immediately cease and terminate, and cause to be terminated, any solicitation, encouragement, discussion or negotiations commenced prior to the date of the Arrangement Agreement with any person (other than Parent) with respect to any inquiry, proposal or offer that constitutes, or could reasonably be expected to constitute or lead to, an Acquisition Proposal, and whether or not initiated by Inter-Citic or its Representatives, and in connection with such termination shall have:

(1) discontinued access to, and disclosure of all information, (including any data room access and any confidential information) regarding Inter-Citic or any affiliate; and

(2) requested, and exercised all rights it has to require (i) the return or destruction of all copies of any confidential information regarding Inter-Citic or any affiliate provided to any person (other than Parent) to the extent that such information has not previously been

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returned or destroyed, and (ii) the destruction of all material including or incorporating or otherwise reflecting such confidential information regarding Inter-Citic or any affiliate using its reasonable commercial efforts to ensure that such requests are fully complied with in accordance with the terms of such rights or entitlements.

Notification Obligations

Inter-Citic is required to promptly notify Parent, at first orally and then in writing, within 24 hours of receipt of any bona fide Acquisition Proposal, or a request for non-public information, such notice shall include a copy of any written Acquisition Proposal (and any amendment thereto) which has been received or, if no written Acquisition Proposal has been received, a description of its material terms and conditions, the identity of all Person(s) making the Acquisition Proposal, inquiry, offer or request, and copies of all documents, correspondence or other material received in respect of, from or on behalf of any such Person.

Inter-Citic agreed to keep Parent promptly and fully informed of material details of the status of discussions and negotiations, including any change or amendment to the terms and conditions of each Acquisition Proposal, inquiry, offer, or request.

Responding to Acquisition Proposals

Notwithstanding any other provision of the Arrangement Agreement, if at any time following the date of the Arrangement Agreement and prior to obtaining Shareholders’ Approval at theMeeting, Inter-Citic receives a bona fide written Acquisition Proposal that the Board determines in good faith, after consultation with its outside legal counsel and financial advisor, is or could reasonably be expected to result in, if consummated in accordance with its terms, a Superior Proposal, then Inter-Citic may, provided it is in compliance with its non-solicitation and related notification obligations under the Arrangement Agreement:

(1) furnish information with respect to Inter-Citic and its affiliates to the person making such Acquisition Proposal; and/or

(2) enter into, participate, and maintain discussions or negotiations with, and otherwisecooperate with or assist, the person making such Acquisition Proposal,

provided that Inter-Citic shall not, and shall not allow Inter-Citic representatives to, disclose any non-public information with respect to Inter-Citic to such person: (i) if such non-public information has not been previously provided to, or is not concurrently provided to, Parent; and (ii) without entering into an agreement that contains confidentiality, standstill and other provisions that are in the aggregate no less favourable to Inter-Citic in any material respect to the terms applicable to Inter-Citic in the Confidentiality Agreement. In particular but without limitation, such agreement may not include any provision calling for an exclusive right to negotiate with Inter-Citic and may not restrict Inter-Citic or its affiliates or Representatives from complying with this provision.

Superior Proposal

Subject to Parent’s right to match a Superior Proposal (as described below), Inter-Citic agreed not to make a Change in Recommendation or enter into a definitive agreement with respect ofsuch Acquisition Proposal that is a Superior Proposal), if and only if:

(1) the person making the Superior Proposal was not restricted from making such Superior Proposal pursuant to an existing standstill or similar restriction;

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(2) Inter-Citic has been, and continues to be, in compliance with its obligations under the non-solicitation provisions in the Arrangement Agreement;

(3) Inter-Citic has delivered to Parent a written notice of the determination of the Board that such Acquisition Proposal constitutes a Superior Proposal and of the intention of the Board to enter into such definitive agreement, together with a written notice from the Board regarding the value and financial terms that the Board, in consultation with its financial advisor, has determined should be ascribed to any non-cash consideration offered under such Acquisition Proposal (the “Superior Proposal Notice”);

(4) Inter-Citic has provided Parent a copy of the proposed definitive agreement for the Superior Proposal;

(5) at least five (5) business days (the “Matching Period”) have elapsed following the date that is the later of the date on which Parent received the Superior Proposal Notice and a copy of the proposed definitive agreement for the Superior Proposal from Inter-Citic;

(6) during each Matching Period, Parent has had the opportunity (but not the obligation), to offer to amend the Arrangement Agreement and the Arrangement in order for such Acquisition Proposal to cease to be a Superior Proposal;

(7) after the Matching Period, the Board has determined in good faith, after consultation with Inter-Citic’s outside legal counsel and financial advisers, that such Acquisition Proposal continues to constitute a Superior Proposal compared to the terms of the Arrangement as proposed to be amended by Parent;

(8) such Superior Proposal does not provide for the payment of any break, termination or other fees or expenses to any person in the event that Inter-Citic completes the transactions contemplated by the Arrangement Agreement or any other similar transaction with Parent agreed to prior to the termination of the Arrangement Agreement;and

(9) prior to or concurrently with entering into such definitive agreement Inter-Citic terminates the Arrangement Agreement.

Parent’s Matching Right

(1) During each Matching Period: (a) the Board shall review any written offer duly made by Parent to amend the terms of the Arrangement Agreement and the Arrangement in good faith in order to determine whether such amended proposal would, upon acceptance, result in the Acquisition Proposal previously constituting a Superior Proposal ceasing to be a Superior Proposal; and (b) Inter-Citic shall negotiate in good faith with Parent to make such amendments to the terms of the Arrangement Agreement and the Arrangement as would enable Parent to proceed with the transactions contemplated by the Arrangement Agreement on such amended terms. If the Board determines that such Acquisition Proposal would cease to be a Superior Proposal, Inter-Citic shall promptly so advise Parent, and Inter-Citic, Parent and Acquireco shall amend the ArrangementAgreement to reflect such written offer made by Parent, and shall take and cause to be taken all such actions as are necessary to give effect to the foregoing.

(2) Each successive amendment to any Acquisition Proposal to be received by Inter-Citic Shareholders shall constitute a new Acquisition Proposal, and Parent shall be afforded a new five (5) business day Matching Period from the later of the date on which Parent

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received the Superior Proposal Notice and a copy of the definitive agreement for the new Superior Proposal from Inter-Citic.

(3) The Board shall promptly reaffirm the Board recommendation by press release after any Acquisition Proposal which is not determined to be a Superior Proposal is publicly announced or Board determines that a proposed amendment to the terms of the Arrangement Agreement made by Parent would result in an Acquisition Proposal no longer being a Superior Proposal. Inter-Citic shall provide Parent and its outside legal counsel with a reasonable opportunity to review the form and content of any such press release.

(4) if Inter-Citic provides a Superior Proposal Notice to Parent after a date that is less than ten (10) business days before the Meeting, Inter-Citic shall, as directed by Parent, either proceed with or shall postpone the Meeting, to a date that is not more than five (5) business days after the scheduled date of the Shareholder Meeting.

(5) Nothing contained in the Arrangement Agreement shall prohibit the Board from making any disclosure to Shareholders, responding through a directors’ circular or otherwise as required by applicable Securities Laws to any Acquisition Proposal or from calling and holding a meeting of Shareholders requisitioned by Shareholders in accordance with the CBCA or ordered to be held by a court pursuant to the CBCA, in each case prior to the Effective Date if required under applicable Laws.

Termination

The Arrangement Agreement may be terminated at any time prior to the Effective Time by mutual written agreement of Inter-Citic, Parent and Acquireco.

The Arrangement Agreement may also be terminated at any time prior to the Effective Time by:

(1) either Inter-Citic or Parent if:

(a) Shareholders’ Approval is not obtained at the Meeting (or any adjournment or postponement thereof) in accordance with the Interim Order, provided that a Party may not terminate the Arrangement if the failure to obtain Shareholders’Approval has been principally caused by, or is a result of, a breach by such Party of any of its representations or warranties or the failure of such Party to perform any of its covenants or agreements under the Arrangement Agreement;

(b) after the date of the Arrangement Agreement, any Law is enacted, made, enforced or amended, as applicable, that makes the consummation of the Arrangement illegal or otherwise permanently prohibits or enjoins Inter-Citic or Parent from consummating the Arrangement, and such Law has, if applicable, become final and non-appealable;

(c) the Regulatory Approvals have not been obtained by the Outside Date, provided that a Party may not terminate the Arrangement Agreement if the failure to obtain the Regulatory Approvals has been principally caused by, or is principally a result of, a breach by such Party of any of its representations or warranties or the failure of such Party to perform any of its covenants or agreements under the Arrangement Agreement; or

(d) the Effective Time does not occur on or prior to the Outside Date, provided that a Party may not terminate the Arrangement Agreement if the failure of the

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Effective Time to so occur has been principally caused by, or is a result of, a breach by such Party of any of its representations or warranties or the failure of such Party to perform any of its covenants or agreements under the Arrangement Agreement;

(2) Inter-Citic if:

(a) a breach of any representation or warranty or failure to perform any covenant or agreement on the part of Parent or Acquireco under the Arrangement Agreement occurs that would cause any condition that is the responsibility of Parent or Acquireco not to be satisfied, and such breach or failure is incapable of being cured;

(b) prior to the approval by Shareholders of the Arrangement Resolution, the Board authorizes Inter-Citic to enter into a written agreement with respect to a Superior Proposal and that prior to or concurrent with such termination Inter-Citic duly pays the Termination Fee; or

(c) Parent does not provide or cause to be provided to the Depositary, Inter-Citic and Acquireco, sufficient funds in cash to complete the transactions contemplated by the Arrangement and the Arrangement Agreement.

(3) Parent if:

(a) a breach of any representation or warranty or failure to perform any covenant or agreement on the part of Inter-Citic under the Arrangement Agreement occurs that would cause any condition that is the responsibility of Inter-Citic not to be satisfied;

(b) the Board or any committee of the Board shall have made a Change in Recommendation, or Inter-Citic breaches its non-solicit obligations under the Arrangement Agreement in any material respect, or the Board or any committee of the Board resolves to take any of the foregoing actions; or

(c) there has occurred a Material Adverse Effect.

(4) If the Arrangement Agreement is terminated in accordance with its terms, the Arrangement Agreement shall become void and of no further force or effect without liability of any Party (or any shareholder, director, officer, employee, agent, consultant or representative of such Party) to any other Party to the Arrangement Agreement, except that in the event of termination other than due to the Effective Date being reached, among other things, certain indemnification obligations of Parent, this provision, Termination and Break-Up Fee obligations, expense and liquidated damagesobligations, and the Confidentiality Agreement (other than the standstill contained in Section 14 of the Confidentiality Agreement which shall terminate), shall survive. Notwithstanding the foregoing, but subject to the next following sentence: (i) in the case of a Termination Fee Event, all liabilities and damages of Inter-Citic, including relating to indemnification obligations of Inter-Citic, shall be limited to the Termination Fee and shall only be incurred in the circumstances set forth in the section herein entitled “Termination Fee”; (ii) if the Termination Fee is not payable by Inter-Citic, then all such liabilities and damages of Inter-Citic, including relating to indemnification obligations of Inter-Citic, shall be limited to an amount not to exceed $50,000,000; (iii) if the Break-Up Fee is payable by Parent or Acquireco, then all liabilities and damages of Parent and

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Acquireco, including relating to indemnification obligations of Parent and Acquireco, shall be limited to the Break-Up Fee and shall only be incurred in the circumstances set forth in the section herein entitled “Break-Up Fee”; and (iv) if the Break-Up Fee is not payable by Parent or Acquireco, then all such liabilities and damages of Parent and Acquireco, including relating to indemnification obligations of Parent and Acquireco, shall be limited to an amount not to exceed $50,000,000. No Party shall be relieved of any liability for any Wilful Breach by it of the Arrangement Agreement.

Termination Fee, Break-Up Fee and Expenses

Termination Fee

The Arrangement Agreement requires Inter-Citic to pay, or cause to be paid, to Parent, the Termination Fee in the amount of $7 million, as liquidated damages, in any of the following circumstances:

(1) Inter-Citic terminates the Arrangement Agreement in order to enter into a binding written agreement with respect to a Superior Proposal (other than a permitted confidentiality agreement), subject to compliance with Inter-Citic’s non-solicitation and right to match covenants;

(2) Parent terminates the Arrangement Agreement in the event that: (i) the Board or any committee thereof has made a Change in Recommendation; or (ii) Inter-Citic has breached any of its non-solicitation and right to match covenants in any material respect;or

(3) (i) the Arrangement Agreement is terminated by Parent or Inter-Citic (which terminationright is not available to any Party whose failure to fulfill any of its obligations, or breach of any of its representations and warranties, has been a principal cause of, or resulted in, the failure to obtain the Required Arrangement Vote at the Meeting (or any adjournment or postponement thereof); (ii) after the date of the Arrangement Agreement, and prior to the Meeting, an Acquisition Proposal has been publicly announced or publicly made or otherwise publicly disclosed, (which announcement has not been publicly withdrawn); and (iii) an Acquisition Proposal is consummated within nine months from the exercise of such termination rights, provided that for purposes of this provision, references to “20% or more” in the definition of “Acquisition Proposal” are deemed to be references to “50% or more”.

According to the Arrangement Agreement, in no event will Inter-Citic be required to make more than one payment under the Termination Fee provisions.

Break-Up Fee

Parent shall cause to be paid to Inter-Citic the amount of $7 million as liquidated damages, if the Arrangement Agreement is terminated by Inter-Citic as a result of a breach of any representation or warranty or failure to perform any covenant or agreement on the part of Parent or Acquireco under the Arrangement Agreement occurs that would cause any condition that is the responsibility of Parent or Acquireco not to be satisfied, and such breach or failure is incapable of being cured; or Parent does not provide or cause to be provided to the Depositary, Inter-Citic and Acquireco, sufficient funds in cash to complete the transactions contemplated by the Arrangement and the Arrangement Agreement, which payment shall be made within two business days following such termination.

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Pursuant to an escrow agreement dated August 24, 2012, an affiliate of Parent has deposited, with the Depositary, the amount of $7 million to secure the performance of this obligation of Parent. Independent of any determination that liquidated damages are owed to Inter-Citic by Parent, Under the Escrow Agreement the $7 million shall be released by the Depositary to Inter-Citic upon either receipt of a written joint consent of Parent and Inter-Citic, or an order of the Court.

Expenses

All out-of-pocket third party transaction expenses incurred in connection with the ArrangementAgreement and the Plan of Arrangement, including all costs, expenses and fees of Inter-Citic incurred prior to or after the Effective Date in connection with, or incidental to, the Plan of Arrangement, shall be paid by the Party incurring such expenses, whether or not the Arrangement is consummated.

Directors’ and Officers’ Insurance and Indemnification

Indemnification

From and after the Effective Time, Parent shall fulfill and honour, and shall cause Inter-Citic and/or its successors to fulfill and honour, in all respects, its obligations pursuant to any indemnification agreements between Inter-Citic and the present or former Directors or officers of Inter-Citic or any of its Subsidiaries (each, an “Indemnified Person”) in effect immediately prior to the Effective Time and any indemnification provisions under the constating documents of Inter-Citic or the applicable Laws, in each case, as in effect on the date hereof and to the extent disclosed in the Disclosure Letter and permitted by applicable Laws and/or its successors to not amend, repeal or otherwise modify the provisions with respect to exculpation and indemnification contained in the constating documents of Inter-Citic as in effect on the date hereof for a period of six years from the Effective Time in any manner that would adversely affect the rights thereunder of individuals who, prior to the Effective Time, were Directors or officers of Inter-Citic.

Insurance

(1) Prior to the Effective Time, Inter-Citic and its Subsidiaries shall and, if Inter-Citic and its Subsidiaries are unable to, Parent shall cause Inter-Citic and its Subsidiaries as of the Effective Time, to obtain and fully pay the premium for the extension of the directors’ and officers’ liability coverage of the existing primary and excess directors’ and officers’ insurance policies for Inter-Citic and its Subsidiaries for a period of at least six years from and after the Effective Time (“D&O Insurance”) with terms, conditions, retentions and limits of liability that are no less advantageous than the coverage provided under the existing policies of Inter-Citic and its Subsidiaries with respect to any actual or alleged error, misstatement, misleading statement, act, omission, neglect, breach of duty or any matter claimed against a Director or officer of Inter-Citic or any of its Subsidiaries by reason of him or her serving in such capacity that existed or occurred at or prior to the Effective Time (including in connection with the Arrangement Agreement or the transactions or actions contemplated hereby) provided that the aggregate cost of such D&O Insurance shall not exceed 200% of the aggregate premium paid by Inter-Citic for its current primary and excess directors’ and officers’ insurance policies. If Inter-Citic and its Subsidiaries for any reason fail to obtain such “tail” insurance policies as of the Effective Time, Inter-Citic and its Subsidiaries shall continue to maintain in effect for a period of at least six years from and after the Effective Time the D&O Insurance in place as of the date hereof with terms, conditions, retentions and limits of liability that are no

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less advantageous than the coverage provided under Inter-Citic’s existing policies as of the date hereof, or Inter-Citic shall purchase comparable D&O Insurance for such six-year period with terms, conditions, retentions and limits of liability that are at least as favourable as provided in Inter-Citic’s existing policies as of the date hereof.

(2) If Inter-Citic or any of its successors or assigns shall (i) amalgamate, consolidate with or merge or wind up into any other person and shall not be the continuing or surviving corporation or entity, or (ii) transfer all or substantially all of its properties and assets to any person, then, and in each such case, proper provisions shall be made so that the successors and assigns of Inter-Citic shall assume all of the obligations set forth in this provision. Parent and Acquireco will ensure that Inter-Citic and any successors or assigns have adequate financial resources to satisfy all of the obligations set forth in this provision.

(3) The provisions of this provision survive the consummation of the transactions contemplated by the Arrangement Agreement and are intended for the benefit of, and shall be enforceable by, each insured or indemnified person, his or her heirs or legal representatives and, for such purpose, Inter-Citic hereby confirms that it is acting as agent and trustee on their behalf.

Amendment

The Arrangement Agreement and the Plan of Arrangement may, at any time and from time to time before or after the holding of Inter-Citic Shareholder Meeting but not later than the Effective Time, be amended by mutual written agreement of the Parties, without further notice to or authorization on the part of Security Holders, provided that such amendment does not: (i) invalidate any required approval of the Arrangement by Shareholders; or (ii) after the holding of the Meeting, result in an adverse change in the quantum of consideration payable to Shareholders pursuant to the Arrangement.

PROCEDURES FOR SURRENDER OF SHARE CERTIFICATES AND PAYMENT OF CONSIDERATION

Delivery Requirements

Letter of Transmittal

If you are a Registered Shareholder, you should have received with this Circular a Letter of Transmittal (printed on green paper) for use by you for the purpose of surrendering certificates representing Company Shares under the Arrangement in exchange for the Consideration. The details for the surrender of Company Share certificates to the Depositary and the address of the Depositary are set out in the Letter of Transmittal. You can request additional copies of the Letter of Transmittal by contacting the Depositary. The Letter of Transmittal is also available on SEDAR at www.sedar.com.

The Letter of Transmittal contains important procedural information relating to the Arrangement and should be reviewed carefully. The deposit of Company Shares pursuant to the procedures set out in the Letter of Transmittal will constitute a binding agreement between the depositing Shareholder and Acquireco upon the terms and subject to the conditions of the Arrangement.

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Lost Certificates

In the event that any certificate that, immediately before the Effective Time, represented one or more outstanding Company Shares that were exchanged for applicable Consideration, has been lost, stolen or destroyed, upon the making of an affidavit of that fact by the person claiming such certificate to be lost, stolen or destroyed, the Depositary will deliver cash in exchange for such lost, stolen or destroyed certificate in accordance with the Plan of Arrangement. When authorizing such payment in exchange for any lost, stolen or destroyed certificate, the person to whom such cash is to be delivered must, as a condition precedent to the delivery of such cash, give a bond satisfactory to Parent, Inter-Citic and the Depositary in such amount as they may direct, or otherwise indemnify Parent, Inter-Citic and the Depositary in a manner satisfactory to them, against any claim that may be made against any of them with respect to the certificate alleged to have been lost, stolen or destroyed, and otherwise to take such actions as may be required by the articles and by-laws of Parent and Inter-Citic.

Cancellation of Rights After Six Years

In accordance with the Plan of Arrangement, each certificate that, immediately before the Effective Time, represented one or more Company Shares will be deemed to represent, after the Effective Time and until it is surrendered to the Depositary for cancellation pursuant to the Arrangement, only the right to receive, upon such surrender, a cash payment in lieu of such certificate less any withholdings or deductions in respect of taxes and other amounts required to be withheld or deducted therefrom under any applicable Laws. Any such certificate formerly representing Company Shares that is not duly surrendered on or before the Sixth Anniversary will cease to represent a claim by or interest of any former Shareholder of any kind or nature against or in Inter-Citic, Parent or Acquireco. On the Sixth Anniversary, all cash to which such former Shareholder was entitled will be deemed to have been donated and forfeited to Acquireco.

Determinations

All questions as to validity, form, eligibility (including timely receipt) and acceptance of any Company Shares deposited pursuant to the Arrangement will be determined by Inter-Citic, Parent and Acquireco. Depositing Shareholders agree that such determination will be final andbinding. Parent and Acquireco reserve the absolute right to waive any defect or irregularity in the deposit of any Company Shares. There will be no duty or obligation on Inter-Citic, Parent, Acquireco, the Depositary or any other person to give notice of any defect or irregularity in any deposit of Company Shares and no liability will be incurred by any of them for failure to give such notice. The interpretation by Inter-Citic, Parent and Acquireco of the terms and conditions of the Arrangement (including this Circular and the Letter of Transmittal) will be final and binding. The method of delivery of certificates representing Company Shares and all other required documents is at the option and risk of the person depositing the same. Inter-Citic recommends that such documents be delivered by hand to the Depositary and a receipt obtained or, if mailed, that registered mail with return receipt requested be used and that appropriate insurance be obtained.

Delivery by Non-Registered Shareholders

If you are a Non-Registered Shareholder, you should carefully follow the instructions from the applicable Intermediary that holds Company Shares on your behalf in order to properly deposit your Company Shares and receive payment therefor pursuant to the Arrangement.

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Delivery of Consideration

The Arrangement and the Plan of Arrangement require Acquireco to deposit or cause to be deposited with the Depositary in escrow for the sole benefit of the holders of Company Shares, prior to the Effective Time, cash denominated in Canadian dollars representing the aggregate Consideration required to effect payment in full for all of Company Shares to be acquired pursuant to the Arrangement. In addition, pursuant to the Plan of Arrangement, Acquireco is required to, prior to the Effective Time, deposit or cause to be deposited with Inter-Citic for thesole benefit of Optionholders cash denominated in Canadian dollars required to effect the payments required thereunder in respect of Company Options. Inter-Citic intends to direct Acquireco to deposit such amount with the Depositary for the sole benefit of Optionholders. Pursuant to the Plan of Arrangement, Acquireco is also required to, prior to the Effective Time, deposit or cause to be deposited with the Depositary, for the sole benefit of Warrantholders, the aggregate amount of cash denominated in Canadian dollars required to effect the payments in respect of Warrants required under the Arrangement.

Under no circumstances will interest accrue or be paid to persons depositing Company Shares, regardless of any delay in making such payment. The Depositary will act as the agent of persons who have deposited Company Shares pursuant to the Arrangement for the purpose of receiving payment from Acquireco and transmitting payment from Acquireco to such persons, and receipt of payment by the Depositary will be deemed to constitute receipt of payment by the persons depositing Company Shares.

Upon surrender to the Depositary for cancellation of a certificate that, immediately before the Effective Time, represented one or more outstanding Company Shares, together with a duly completed and executed Letter of Transmittal (with signatures guaranteed if so required in accordance with the instructions in the Letter of Transmittal) and such additional documents and instruments as the Depositary may reasonably require, the former Shareholder surrendering such certificate will be entitled to receive in exchange therefor, and Acquireco and Parent will cause the Depositary to deliver to such former Shareholder following the Effective Time, a cheque (or other form of immediately available funds) representing the cash which such former Shareholder is entitled to receive under the Arrangement for such Company Shares, less anywithholdings or deductions in respect of taxes and other amounts required to be withheld or deducted therefrom under any applicable Laws, and any certificate so surrendered will forthwith be cancelled.

Unless otherwise directed in the Letter of Transmittal, cheques will be issued in the name of the Registered Shareholder of Company Shares so deposited. Unless the person who deposits Company Shares instructs the Depositary to hold a cheque for pick-up by checking the appropriate box in the Letter of Transmittal, cheques will be forwarded by first-class insured mail to the address provided in the Letter of Transmittal. If no address is provided, cheques will be forwarded to the address of the person as shown on the applicable register of Inter-Citic.

On or as soon as practicable after the Effective Time, but in no event later than 5 business days after the Effective Time, the Depositary will deliver: on behalf of Acquireco to each holder who, immediately before the Effective Time, was a Warrantholder (as reflected on the books and records of Inter-Citic); and on behalf of Inter-Citic to each holder who, immediately before the Effective Time, was an Optionholder (as reflected on the books and records of Inter-Citic); a cheque (or other form of immediately available funds) representing the cash which such former holder is entitled to receive under the Arrangement less any withholdings or deductions in respect of taxes and other amounts required to be withheld or deducted therefrom under any applicable Laws, against receipt of such documentation as Parent or Inter-Citic may reasonably

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require, acknowledging the transfer of the Warrants to Acquireco, or the termination of Company Options, as the case may be, held by such former holder.

Any payment made by way of cheque or otherwise by the Depositary on behalf of Acquirecothat has not been deposited or has been returned to the Depositary or that otherwise remains unclaimed, in each case, on or before the Sixth Anniversary will terminate and be deemed to be surrendered and forfeited to Acquireco.

Inter-Citic, Acquireco and the Depositary will be entitled to deduct and withhold from any consideration otherwise payable under the Arrangement to a Shareholder, Optionholder or Warrantholder such taxes and other amounts as Inter-Citic, Acquireco or the Depositary is required or permitted under applicable Laws to deduct and withhold with respect to such payment.

The Depositary will receive reasonable and customary compensation for its services in connection with the Arrangement, will be reimbursed for certain out-of-pocket expenses and will be indemnified by Parent, Acquireco and Inter-Citic against certain liabilities under applicable Laws and expenses incurred in connection therewith.

PRINCIPAL LEGAL MATTERS

Court Approval of the Arrangement and Completion of the Arrangement

The Arrangement requires Court approval under the CBCA. On October 3, 2012, prior to the mailing of this Circular, Inter-Citic obtained the Interim Order, which provides for the calling and holding of the Meeting, the Dissent Rights and other procedural matters. A copy of the Interim Order is attached as Appendix F to this Circular. A copy of the Notice of Application in respect of the Final Order is attached as Appendix E to this Circular.

Subject to obtaining the Required Arrangement Vote in accordance with the Interim Order, the hearing in respect of the Final Order is currently scheduled to take place on November 1, 2012 at 10:00 a.m. (EDT) in the Court at 330 University Avenue, Toronto, Ontario. Any Shareholder and any other interested party who wishes to appear, or to be represented, and to present evidence or arguments must serve and file a notice of intention to appear (a “Notice of Appearance”) as set out in the Notice of Application for the Final Order and Interim Order, together with a copy of any evidence or material which is to be presented to the Court at the hearing of the application for the Final Order, as soon as reasonably practicable and, in any event, no less than three days before the date of the hearing in respect of the Final Order, as set out in the Interim Order, and satisfy any other requirements of the Court. The Court, in hearing the motion for the Final Order, will consider, among other things, the fairness of the Arrangement to parties who may be affected, including the Shareholders. The Court may approve the Arrangement in any manner the Court may direct, subject to compliance with any terms and conditions, if any, as the Court deems fit. In the event that the hearing is postponed, adjourned or rescheduled then, subject to further order of the Court, only those persons having previously served a Notice of Appearance will be given notice of the postponement, adjournment or rescheduled date.

If (a) the Required Arrangement Vote is obtained, (b) the Final Order is granted, and (c) all other conditions under the Arrangement Agreement are satisfied or, where permitted, waived, the Articles of Arrangement will be filed with the CBCA Director and the Arrangement will become effective on the Effective Date. Inter-Citic and Parent currently expect that the Effective Date will occur early in November 2012.

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Canadian Securities Law Considerations

Special Transaction Rules

Since Inter-Citic is a reporting issuer in the Province of Ontario, the Arrangement is subject to the requirements of MI 61-101. MI 61-101 is intended to regulate certain transactions to ensure that all securityholders are treated in a manner that is fair, generally requiring enhanced disclosure, approval by a majority of securityholders excluding interested or related parties, independent valuations and, in certain instances, approval and oversight of certain transactions by a special committee of independent directors. The protections afforded by MI 61-101 apply to “business combinations” (as such term is defined in MI 61-101).

A transaction such as the Arrangement can constitute a “business combination” for purposes of MI 61-101 if a related party of Inter-Citic, such as a director or senior officer or a 10% shareholder, is entitled to receive, as a consequence of the transaction, a “collateral benefit”. A “collateral benefit” is broadly defined for purposes of MI 61-101 and means, subject to certain specified exclusions, any benefit that a related party of the issuer is entitled to receive, directly or indirectly, as a consequence of the transaction, including, without limitation, an increase in salary, a lump sum payment, a payment for surrendering securities, or other enhancement in benefits related to past or future services as an employee, director or consultant of the issuer or of another person, regardless of the existence of any offsetting costs to the related party or whether the benefit is provided, or agreed to, by the issuer or another party to the transaction.

As noted above, the definition of “collateral benefit” contains certain exclusions. In that regard, a benefit received by a related party of Inter-Citic is not considered to be a collateral benefit if the benefit is received solely in connection with the related party’s services as an employee, director or consultant of Inter-Citic or an affiliated entity and (a) the benefit is not conferred for the purpose, in whole or in part, of increasing the value of the consideration paid to the related party for securities relinquished under the Arrangement, (b) the conferring of the benefit is not, by its terms, conditional on the related party supporting the Arrangement in any manner, (c) full particulars of the benefit are disclosed in this Circular, and (d) either (i) at the time the Arrangement was agreed to, the related party and its associated entities beneficially own or exercise control or direction over less than 1% of the outstanding Company Shares, or (ii) (A) if the transaction is a “business combination”, the related party discloses to an independentcommittee of Inter-Citic the amount of consideration that the related party expects it will be beneficially entitled to receive, under the terms of the Arrangement, in exchange for equity securities beneficially owned by the related party, (B) the independent committee, acting in good faith, determines that the value of the benefit, net of any offsetting costs to the related party, is less than 5% of the value referred to in (A), and (C) the independent committee’s determination is disclosed in this Circular.

In evaluating the Arrangement, the Special Committee considered that each of the following could be characterized as a benefit to which certain Directors and senior officers of Inter-Citic are or may become entitled as a consequence of the Arrangement, as contemplated by MI 61-101:

! the $25,000 retirement allowance that each Director will receive upon their resignation (the “retirement benefit”);

! certain termination payments (the “termination benefits”); and

! the fact that the completion of the Arrangement will constitute a change of control under the employment agreements of certain of Inter-Citic’s senior officers, the

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result of which is that, if the senior officer’s employment is terminated without “cause” by Inter-Citic within a specified period of time following completion of the Arrangement or if the senior officer exercises his right to resign within a specified period of time after the completion of the Arrangement, the senior officer may be entitled to receive a severance payment amount (the “COC Benefit”).

The following table sets out the quantum of the COC Benefit and retirement benefit to which each applicable Director and senior officer of, and consultant to, Inter-Citic is or may become entitled in connection with the Arrangement:

Name COC Benefit(1)($) Retirement Benefit and Termination Benefits ($)

Total Benefits($)

James Moore 1,013,000 25,000 1,038,000

Lou Pasubio 715,000 Nil 715,000

Malcolm Swallow Nil 25,000 25,000

Peter Joynt Nil 25,000 25,000

Mark Frederick Nil 25,000 25,000

Michael Doggett Nil 25,000 25,000

Carlos Ho Nil 25,000 25,000

Adrian Ho Nil 25,000 25,000

Don Brown Nil 25,000 25,000

Zhang Hongyi Nil 25,000 25,000

Stephen Lautens Nil 127,0001 127,000

Charles Park 147,000 Nil 147,000

Garth Pierce Nil 134,0002 134,000

Notes:1 This amount is the amount Mr. Lautens is entitled to under his written employment contract if he is terminated without cause.2 This amount is the amount that BCLX Consulting Limited, of which Mr. Pierce is the principal, is entitled to under a written consulting contract if it is terminated without cause.

None of the COC Benefits, retirement benefits, or termination benefits, were conferred for the purpose, in whole or in part, of increasing the value of the consideration paid to such individuals for securities relinquished under the Arrangement and the conferring of such benefits is not, by its terms, conditional on any of such individuals supporting the Arrangement.

As each of the foregoing individuals other than Mr. James Moore, Mr. Lou Pasubio and Mr. Garth Pierce beneficially owns or exercises control or direction over less than 1% of Company Shares, the benefits to which such individuals are or may be entitled as set forth in the table above do not constitute a collateral benefit for purposes of MI 61-101.

The Special Committee met on October 1, 2012 to consider whether the COC Benefit and retirement benefit of Mr. James Moore; the COC Benefit of Mr. Lou Pasubio, and the termination benefits of Mr. Garth Pierce, fall within the exception from the definition of “collateral benefit” as provided in MI 61-101 for Mr. Moore, Mr. Pasubio, Mr. Pierce, or any of them.

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Each of Mr. Moore, Mr. Pasubio and Mr. Pierce, who each beneficially owns or is deemed to own (assuming the exercise of the Company Options held by them), for the purposes of MI 61-101, more than 1% of the outstanding Company Shares, disclosed to the Special Committee the amount of consideration that each expects to be beneficially entitled to receive under the Arrangement in exchange for Company Shares that he beneficially owns. In the case of Mr. Moore, Mr. Moore owns 287,485 Company Shares and is deemed to own 2,022,826 Company Shares that are issuable upon the exercise of his Company Options for an aggregate of 2,310,311 Company Shares, or approximately 1.97% of the issued and outstanding Company Shares on the record date for the Meeting. In the case of Mr. Pasubio, Mr. Pasubio owns 259,100 Company Shares and is deemed to own 1,410,000 Company Shares that are issuable upon the exercise of his Company Options for an aggregate of 1,669,100 Company Shares, or approximately 1.42% of the issued and outstanding Company Shares on the record date for the Meeting. In the case of Mr. Pierce, Mr. Pierce owns 426,900 Company Shares and is deemed to own 1,100,000 Company Shares that are issuable upon the exercise of Company Options for an aggregate of 1,526,900 Company Shares, or approximately 1.30% of the issued and outstanding Company Shares on the record date for the Meeting.

The Special Committee determined that the value of the benefits to which Mr. Moore, Mr. Pasubio and Mr. Pierce is entitled, net of offsetting costs, would be more than 5% of the amount of consideration that each of Mr. Moore, Mr. Pasubio and Mr. Pierce, respectively, will be entitled to receive under the Arrangement in exchange for his Company Shares if, within a specified time after completion of the Arrangement, such party’s employment is terminated without “cause” or such party resigns following the change of control caused by the Arrangement and such party is paid a severance amount pursuant to his employment agreement, or in the case of Mr. Pierce, the consulting agreement between Inter-Citic and BCLX Consulting Limited is terminated.

As a consequence of the foregoing determination, the Arrangement constitutes a business combination pursuant to MI 61-101.

Minority Approval

MI 61-101 requires that, in addition to any other required securityholder approval, a business combination must be approved by a simple majority of the votes cast by “minority” securityholders of each class of affected securities (which in the case of Inter-Citic consists only of Company Shares), voting separately as a class (often referred to as “minority approval”). In relation to the Arrangement and for purposes of the required Shareholder approval for the Arrangement, the “minority” securityholders of Inter-Citic are all holders of Company Shares other than (a) any interested party to the Arrangement within the meaning of MI 61-101, (b) any related party to such interested party within the meaning of MI 61-101 (subject to the exceptions set out therein), and (c) any person that is a joint actor with any of the foregoing for the purposes of MI 61-101.

Accordingly, solely the votes cast in respect of Company Shares that are beneficially owned by Mr. Moore, Mr. Pasubio and Mr. Pierce, representing in the aggregate 973,485 Company Shares, or approximately 0.828% of the issued and outstanding Company Shares on the record date for the Meeting, will be excluded for the purpose of determining if minority approval of the Arrangement Resolution is obtained.

Valuation Requirements

MI 61-101 also requires that an issuer obtain a formal valuation for a transaction that constitutes a business combination if an interested party of Inter-Citic (as defined in MI 61-101, and who

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has to be a related party of Inter-Citic at the time the transaction is agreed to), would, as a consequence of the Arrangement, directly or indirectly acquire Inter-Citic or its business or combine with Inter-Citic. As no interested party is acquiring Inter-Citic, Inter-Citic is not required to obtain a formal valuation.

To the knowledge of the Board and senior officers of Inter-Citic, after reasonable inquiry, there have been no prior valuations in respect of Inter-Citic (as contemplated in MI 61-101) within the 24-month period preceding the date of this Circular and, except as described under the heading “The Arrangement — Background to the Arrangement”, no bona fide prior offer (as contemplated by MI 61-101) that relates to the transactions contemplated by the Arrangement has been received by Inter-Citic during the 24-month period preceding the execution of the Arrangement Agreement.

Regulatory Matters

PRC Approvals

The Arrangement is conditional upon the receipt of certain Regulatory Approvals, including the PRC Approvals. The PRC Approvals are regulatory approvals in The People’s Republic of China that Parent and Acquireco are required to obtain in order to complete the transactions contemplated by the Arrangement Agreement. The PRC Approvals comprise the approvals of the following Governmental Entities: (a) the 青海省国有资产监督管理委员会（State-owned Assets Supervision and Administration Commission of Qinghai Province）approval; (b) the中华人民共和国国家发展和改革委员会（National Development and Reform Commission of the People’s Republic of China) approval); (c) the 中华人民共和国商务部（Ministry of Commerce of the People’s Republic of China）approval; (d) the 国家外汇管理局青海省分局（The State Administration of Foreign Exchange Bureau of Qinghai Province）registration.

The Chinese Governmental Entities from which Parent requires approval are described below, along with the status of each approval as of the date of this Circular:

(1) The State-owned Assets Supervision and Administration Commission (SASAC). Parent submitted the application on August 27, 2012 and approval was obtained on September 20, 2012.

(2) The State Development and Reform Commission (NDRC). Parent submitted the application to the Qinghai Provincial Development and Reform Commission (PDRC) on August 27, 2012 and approval was obtained September 28, 2012.

(3) Ministry of Commerce of the People's Republic of China (MOFCOM). Parent submitted the application on August 27, 2012. The Qinghai branch of MOFCOM has submitted its application to the national MOFCOM which is a significant step towards the final approval. Parent is closely following up the process and working towards obtaining the approval as soon as possible.

(4) Qinghai branch of the State Administration of Foreign Exchange (SAFE). SAFE is expected to issue its approval after the successful completion of approval process at NDRC and MOFCOM. Parent is closely following up the process and working towards obtaining SAFE approval shortly after the obtaining of NDRC and MOFCOM approvals.

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Parent has agreed in the Arrangement Agreement to use its best efforts to obtain the PRC Approvals. As noted above, the deadline for obtaining the PRC Approvals under the Arrangement Agreement is December 22, 2012, the Outside Date.

INFORMATION CONCERNING INTER-CITIC

Price Range and Trading Volume Data

Company Shares are listed and trade on the TSX under the symbol “ICI”. The following table summarizes the high and low prices and volumes of trading of Company Shares on the TSX for each of the periods indicated:

2011 High Low Total Volume

September 1.37 0.71 2,760,321

October 1.22 0.72 2,486,331

November 1.20 0.93 1,091,475

December 1.24 0.90 1,651,613

2012 High Low Total Volume

January 1.31 0.97 1,369,811

February 1.38 1.24 1,004,605

March 1.36 1.01 1,665,573

April 1.05 0.88 1,205,030

May 0.94 0.73 1,755,572

June 0.97 0.82 2,039,232

July 1.61 0.90 5,031,939

August 2.03 1.37 12,731,199

September 1.96 1.90 5,862,266

The Consideration of $2.05 in cash per Company Share represents a premium of approximately 123% over the $0.9193 closing price of Company Shares on the TSX on July 6, 2012, the last trading day prior to the announcement by Inter-Citic of the proposed Arrangement, and a premium of approximately 41.4% over the $1.45 closing price for Company Shares on the TSX on August 24, 2012, the last trading day preceding the announcement of the Arrangement.

Independent Auditors

PricewaterhouseCoopers LLP, Chartered Accountants are the auditors of Inter-Citic.

Risk Factors Related to Inter-Citic

Whether or not the Arrangement is completed, Inter-Citic will continue to face many of the risks that it currently faces with respect to its business and affairs. A description of the risk factors applicable to Inter-Citic is contained under the heading “Narrative Description of the Business

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and Risk Factors” in Inter-Citic’s annual information form for the fiscal year ended November 30, 2011 dated February 25, 2012. See also “Risk Factors Related to the Arrangement” in this Circular.

Indebtedness of Directors and Executive Officers

At no time during the most recently completed fiscal year has any of the executive officers, Directors, employees and former executive officers, Directors and employees of the Corporation or any of its subsidiaries been indebted to: (a) the Corporation or any of its subsidiaries; or (b) any other entity whereby the indebtedness is the subject of a guarantee, support agreement, letter of credit or other similar arrangement or understanding provided by the Corporation or any of its subsidiaries.

INFORMATION CONCERNING PARENT AND ACQUIRECO

Parent

Parent is an integrated resources development company established under the laws of The People’s Republic of China and is based in Qinghai Province, People’s Republic of China. Parent has total assets of approximately C$5.5 billion. Parent has strong management capabilities and has pursued a strategic expansion which has taken the company into geological exploration, mining, processing, smelting, scientific research and development, trade, investment and financing. There are approximately 40 companies within Parent, including Western Mining Co., Ltd, which is listed on the Shanghai Stock Exchange.

Acquireco

Acquireco is an indirect wholly-owned subsidiary of Parent incorporated under the laws of Canada. It is formed and organized solely for the purpose of completing the Arrangement and, prior to Parent advancing to Acquireco the necessary funds to enable Acquireco to pay the aggregate Consideration under the Arrangement, will have no assets or liabilities other than nominal share capital held indirectly by Parent. In connection with the completion of the Arrangement, Acquireco will be funded, directly or indirectly, by Parent to enable Acquireco to pay the aggregate Consideration payable to the Shareholders pursuant to the Arrangement.

Summary Description of Parent’s Business

Parent was formed in 2000 as part of the reform of the nonferrous metals industry in China. The Parent has evolved from a single-mine enterprise in 2000 to an integrated resources development company today. It operates ten production mines and has ten mines that are in the exploration and construction phase. Key products are copper concentrate, lead concentrate, zinc concentrate, iron ore concentrate, cathode copper, copper anode plate, electrolytic aluminium, electrolytic zinc, crude lead and tin ingot. In addition, Parent has expanding operations in the areas of energy and power, the salt chemical industry and in the financial sector.

CERTAIN CANADIAN FEDERAL INCOME TAX CONSIDERATIONS

General

In the opinion of Miller Thomson LLP, Canadian counsel to Inter-Citic, the following is a general summary, as of the date hereof, of the principal Canadian federal income tax considerations generally applicable to a beneficial owner of Company Shares who disposes of Company Shares pursuant to the Arrangement and who, for purposes of the Tax Act and at all relevant times (a) holds Company Shares as capital property, (b) deals at arm’s length with Parent, Acquireco, Inter-Citic, and their respective affiliates, and (c) is not affiliated with Parent, Acquireco, Inter-Citic, or their respective affiliates, (a “Holder or “Holders”). Company Shares will generally constitute capital property to a Holder provided the Holder does not hold such shares in the course of carrying on a business or as part of an adventure in the nature of trade.

This summary is not applicable to Holders holding Company Options, Warrants or other rights to acquire Company Shares, or Holders who acquired Company Shares on the exercise of employee stock options. All such Holders should consult their own tax advisors in this regard.

This summary is based on the current provisions of the Tax Act, all specific proposed amendments to the Tax Act publicly announced by or on behalf of the Minister of Finance (Canada) before the date hereof (“Proposed Amendments”) and counsel’s understanding of the current administrative policies and assessing practices of the CRA published in writing prior to the date hereof and assumes that the Proposed Amendments will be enacted in the form proposed. This summary does not otherwise take into account or anticipate changes in Law, whether by judicial, governmental or legislative decision or action, or changes in the administrative policy or assessing practices of the CRA, nor does it take into account provincial, territorial or foreign tax legislation or considerations, which may differ significantly from the Canadian federal income tax considerations discussed herein. No assurances can be given that the Proposed Amendments will be enacted in the form proposed or at all, or that legislative, judicial or administrative changes will not modify or change the statements expressed herein.

This summary is of a general nature only and is not, and is not intended to be, nor should it be construed to be, legal or tax advice to any particular Shareholder. This summary is not exhaustive of all Canadian federal income tax considerations of disposing of Company Shares pursuant to the Arrangement. Accordingly, Shareholders should consult their own tax advisorswith respect to the disposition of their Company Shares pursuant to the Arrangement having regard to their own particular circumstances.

Holders Resident in Canada

This part of the summary is generally applicable to a Holder who, at all relevant times for purposes of the Tax Act is, or is deemed to be, resident in Canada (a “Resident Holder” or “Resident Holders”). Certain Resident Holders who might not otherwise be considered to hold their Company Shares as capital property may, in certain circumstances, be entitled to have their Company Shares and all other “Canadian securities” (as defined in the Tax Act) owned by them in the taxation year in which the election is made, and in all subsequent taxation years, treated as capital property by making an irrevocable election under subsection 39(4) of the Tax Act. Resident Holders should consult their own tax advisor concerning this election.

This part of the summary is not applicable to a Shareholder that is a “financial institution” (as defined in the Tax Act for purposes of the mark-to-market rules), a “specified financial institution” (as defined in the Tax Act), a shareholder an interest in which is a “tax shelter investment” for purposes of the Tax Act, or a Shareholder that reports its “Canadian tax results”

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in a currency other than Canadian currency. Such Shareholders should consult their own tax advisors with respect to their own particular circumstances.

Disposition of Company Shares Pursuant to the Arrangement

Generally, a Resident Holder who disposes of his, her or its Company Shares under the Arrangement will realize a capital gain (or capital loss) equal to the amount by which the proceeds of disposition, net of any reasonable costs of disposition, exceed (or are less than) the adjusted cost base to the Resident Holder of such Company Shares immediately before the disposition. The general tax treatment of capital gains and losses is discussed below under the heading “Certain Canadian Federal Income Tax Considerations — Holders Resident in Canada — Taxation of Capital Gains and Capital Losses”.

Taxation of Capital Gains and Capital Losses

Generally, a Resident Holder is required to include in computing his, her or its income for a taxation year one-half of the amount of any capital gain (a “taxable capital gain”) realized in the year. Subject to and in accordance with the provisions of the Tax Act, a Resident Holder is required to deduct one-half of the amount of any capital loss (an “allowable capital loss”) realized in a taxation year from taxable capital gains realized in such taxation year by such Resident Holder. Allowable capital losses in excess of taxable capital gains for the year may be carried back and deducted in any of the three preceding taxation years or carried forward and deducted in any subsequent taxation year against net taxable capital gains realized in suchtaxation year to the extent and under the circumstances described in the Tax Act.

The amount of any capital loss realized by a Resident Holder that is a corporation on the disposition of a Company Share may be reduced by the amount of any dividends received (or deemed to be received) by the Resident Holder on such Company Share to the extent and under the circumstances prescribed by the Tax Act. Similar rules may apply to reduce any capital loss in respect of the disposition of Company Shares owned by a partnership or trust of which a corporation, trust or partnership is a member or beneficiary. Resident Holders to whom these rules may be relevant should consult their own tax advisors.

A Resident Holder that is throughout the year a “Canadian-controlled private corporation” (as defined in the Tax Act) may be liable to pay, in addition to the tax otherwise payable under the Tax Act, a refundable tax of 6 2/3% on its “aggregate investment income” including taxable capital gains.

A capital gain realized by an individual or a trust, other than certain trusts, may give rise to alternative minimum tax.

Resident Holders should consult their own tax advisors in respect of such refundable tax and alternative minimum tax.

Dissenting Resident Holders

A Resident Holder who validly exercises Dissent Rights (a “Dissenting Resident Holder”) will, pursuant to the Plan of Arrangement, be deemed to transfer such person’s shares to Acquireco and will be entitled to be paid the fair value of such shares by Acquireco. In general, a Dissenting Resident Holder will realize a capital gain (or capital loss) equal to the amount, if any, by which the consideration received in respect of the fair value of such holder’s shares (other than in respect of interest awarded by a court) exceeds (or is less than) the aggregate adjusted cost base of such shares to the Dissenting Resident Holder and any reasonable costs

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of disposition. See “Certain Canadian Federal Income Tax Considerations — Holders Resident in Canada — Taxation of Capital Gains and Capital Losses” in this Circular. Any interest awarded to a Dissenting Resident Holder by a court will be required to be included in such holder’s income for purposes of the Tax Act.

Holders Not Resident in Canada

This portion of the summary is generally applicable to a Holder who, at all relevant times for purposes of the Tax Act, is not, and is not deemed to be, resident in Canada and does not use or hold, and is not deemed to use or hold Company Shares in a business carried on in Canada (a “Non-Resident Holder” or “Non- Resident Holders”). Special rules, which are not discussed in this summary, may apply to Non-Resident Holders that are insurers carrying on an insurance business in Canada and elsewhere. Non-Resident Holders to whom these special rules may be relevant should consult their own tax advisors.

Disposition of Company Shares Pursuant to the Arrangement

A Non-Resident Holder will not be subject to tax under the Tax Act in respect of any capital gain realized on a disposition of Company Shares pursuant to the Arrangement unless such shares are “taxable Canadian property” (as defined in the Tax Act) to such Non-Resident Holder at the time of disposition and such capital gain is not otherwise exempt from tax under the Tax Act pursuant to the provisions of an applicable income tax treaty.

Generally, Company Shares will not be taxable Canadian property to a Non-Resident Holder at the time of disposition provided that such shares are listed at that time on a “designated stock exchange” (as defined in the Tax Act), which includes the TSX, unless at any particular time during the 60-month period that ends at that time, (a) the Non-Resident Holder, persons not dealing at arm’s length with such Non-Resident Holder, or the Non-Resident Holder together with all such persons, has owned 25% or more of the issued shares of any class or series of the capital stock of Inter-Citic, and (b) more than 50% of the fair market value of Company Shares was derived directly or indirectly from one or any combination of (i) real or immovable property situated in Canada, (ii) “Canadian resource properties” (as defined in the Tax Act), (iii) “timber resource properties” (as defined in the Tax Act), and (iv) options in respect of, or interests in, or for civil law rights in, property in any of the foregoing, whether or not the property exists. Notwithstanding the foregoing, in certain circumstances set out in the Tax Act, Company Shares could be deemed to be taxable Canadian property.

In the event that Company Shares constitute or are deemed to constitute taxable Canadian property to any Non-Resident Holder, the Non-Resident Holder may be entitled to relief under the provisions of an applicable income tax treaty.

Non-Resident Holders whose Company Shares may be taxable Canadian property should consult their own tax advisors having regard to their particular circumstances.

Dissenting Non-Resident Holders

A Non-Resident Holder who validly exercises Dissent Rights (a “Dissenting Non-Resident Holder”) will, pursuant to the Plan of Arrangement, be deemed to transfer such holder’s shares to Acquireco and will be entitled to be paid the fair value of such shares by Acquireco. In general, the tax treatment of a Dissenting Non-Resident Holder will be similar to that of a Non-Resident Holder who participates in the Arrangement. See “Certain Canadian Federal Income Tax Considerations — Holders Not Resident in Canada — Disposition of Company SharesPursuant to the Arrangement” in this Circular.

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A Dissenting Non-Resident Holder will not be subject to Canadian withholding tax under the Tax Act in respect of any interest awarded to such holder by a court.

DISSENTING REGISTERED SHAREHOLDERS’ RIGHTS

Section 190 of the CBCA provides registered shareholders of a corporation with the right to dissent from certain resolutions of a corporation that effect extraordinary corporate transactions or fundamental corporate changes. The Interim Order expressly provides Registered Shareholders with the right to dissent from the Arrangement Resolution pursuant to Section 190 of the CBCA, with modifications to the provisions of Section 190, as provided in the Interim Order and the Final Order.

Any Registered Shareholder who validly dissents from the Arrangement Resolution in compliance with Section 190 of the CBCA, as modified by the Interim Order and the Final Order, will, in the event the Arrangement becomes effective, be deemed to have assigned andtransferred (free and clear of any Liens) the holder’s Company Shares to Acquireco and in consideration of a debt claim against Acquireco to be paid by Acquireco the fair value of Company Shares held by such Dissenting Shareholder in accordance with these dissent rights. Shareholders are cautioned that fair value could be determined to be less than the Consideration.

Section 190 of the CBCA provides that a shareholder may only make a claim under that section with respect to all of the shares of a class held by the shareholder on behalf of any one beneficial owner and registered in the shareholder’s name. One consequence of this provision is that only a Registered Shareholder may exercise the Dissent Rights in respect of Company Shares that are registered in that Shareholder’s name. None of the following shall be entitled to exercise Dissent Rights: (a) Optionholders and Warrantholders, and (b) Shareholders who vote, or are deemed to have instructed a proxyholder to vote, their Company Shares for the Arrangement Resolution (but only in respect of such Company Shares).

In many cases, shares beneficially owned by a Non-Registered Shareholder are registered either: (a) in the name of an Intermediary, or (b) in the name of a clearing agency (such as CDS) of which the Intermediary is a participant. Accordingly, a Non-Registered Shareholder will not be entitled to exercise its Dissent Rights directly unless Company Shares are re-registered in the Non-Registered Shareholder’s name. A Non-Registered Shareholder who wishes to exercise Dissent Rights should contact the Intermediary with whom the Non-Registered Shareholder deals in respect of its Company Shares and either: (a) instruct the Intermediary to exercise the Dissent Rights on the Non-Registered Shareholder’s behalf (which, if Company Shares are registered in the name of CDS or other clearing agency, may require that such Company Shares first be re-registered in the name of the Intermediary), or (b) instruct the Intermediary to re-register such Company Shares in the name of the Non-Registered Shareholder, in which case the Non-Registered Shareholder would be able to exercise the Dissent Rights directly.

A Registered Shareholder who wishes to dissent must provide a Dissent Notice to Inter-Citic (a) at 60 Columbia Way, Suite 501, Markham, Ontario L3R 0C9; or (b) by facsimile transmission to (905) 479-6397, in either case to be received not later than 5:00 p.m. (EDT) on Friday, October 26, 2012 (or the date that is one business day immediately preceding the date set for any adjournment or postponement of the Meeting). Failure to strictly comply with these dissent procedures may result in the loss or unavailability of the right to dissent.

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The filing of a Dissent Notice does not deprive a Registered Shareholder of the right to vote at the Meeting. However, the CBCA provides that a Registered Shareholder who has submitted a Dissent Notice and who votes for the Arrangement Resolution will no longer be considered a Dissenting Shareholder with respect to the Arrangement Resolution. The CBCA does not provide, and neither Inter-Citic nor Acquireco will assume, that a proxy submitted instructing the proxyholder to vote against the Arrangement Resolution, a vote against the Arrangement Resolution or an abstention constitutes a Dissent Notice, but a Registered Shareholder need not vote its Company Shares against the Arrangement Resolution in order to dissent. Similarly, the revocation of a proxy conferring authority on the proxyholder to vote for the Arrangement Resolution does not constitute a Dissent Notice. However, any proxy granted by a Registered Shareholder who intends to dissent, other than a proxy that instructs the proxyholder to vote against the Arrangement Resolution, should be validly revoked in order to prevent the proxyholder from voting such Company Shares in favour of the Arrangement Resolution and thereby causing the Registered Shareholder to forfeit its Dissent Rights.

Assuming that Shareholders approve the Arrangement Resolution at the Meeting, Inter-Citic (or its successor) is required, within 10 days after the date of the Meeting, to notify each Dissenting Shareholder that the Arrangement Resolution has been adopted. Such notice is not required to be sent to any Shareholder who voted for the Arrangement Resolution or who has withdrawn its Dissent Notice.

A Dissenting Shareholder who has not withdrawn its Dissent Notice prior to the Meeting must then, within 20 days after receipt of notice that the Arrangement Resolution has been approved, or if the Dissenting Shareholder does not receive such notice, within 20 days after learning that the Arrangement Resolution has been adopted, send to Inter-Citic a written notice (a “Demand for Payment”) containing its name and address, the number of Company Shares in respect of which he, she or it dissents (the “Dissenting Shares”) and a demand for payment of the fair value of such Dissenting Shares. Within 30 days after sending the Demand for Payment, the Dissenting Shareholder must send certificates representing the Dissenting Shares to Inter-Citic or the Transfer Agent. The Transfer Agent will endorse on the certificates representing Company Shares received from a Dissenting Shareholder a notice that the holder is a Dissenting Shareholder and will forthwith return such certificates to the Dissenting Shareholder. A Dissenting Shareholder who fails to make a Demand for Payment in the time required or to send certificates representing Dissenting Shares in the time required has no right to make a claim under Section 190 of the CBCA, and will lose his, her or its fair value.

After sending a Demand for Payment, a Dissenting Shareholder ceases to have any rights as a Shareholder in respect of its Dissenting Shares other than the right to be paid the fair value of such Company Shares as determined pursuant to Section 190 of the CBCA, unless (a) the Dissenting Shareholder withdraws its Dissent Notice before Acquireco makes an Offer to Pay, (b) Acquireco fails to make an Offer to Pay in accordance with Section 190(12) of the CBCA and the Dissenting Shareholder withdraws the Demand for Payment, or (c) the Directors revoke the Arrangement Resolution in which case the Dissenting Shareholder’s rights as a Shareholder will be reinstated.

Pursuant to the Plan of Arrangement, Dissenting Shareholders who are ultimately determined not to be entitled, for any reason, to be paid fair value for their Dissenting Shares, shall be deemed to have participated in the Arrangement on the same basis as any non-Dissenting Shareholder.

Acquireco is required, not later than seven days after the later of the Effective Date and the date on which a Demand for Payment is received from a Dissenting Shareholder, to send to each Dissenting Shareholder who has sent a Demand for Payment an Offer to Pay for its Dissenting

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Shares in an amount considered by the directors of Acquireco to be the fair value of Company Shares, accompanied by a statement showing the manner in which the fair value was determined. Every Offer to Pay must be on the same terms. Acquireco must pay for the Dissenting Shares of a Dissenting Shareholder within 10 days after an Offer to Pay has been accepted by a Dissenting Shareholder, but any such offer lapses if Acquireco does not receive an acceptance within 30 days after the Offer to Pay has been made.

If Acquireco fails to make an Offer to Pay for a Dissenting Shareholder’s Dissenting Company Shares, or if a Dissenting Shareholder fails to accept an Offer to Pay that has been made, Acquireco may, within 50 days after the Effective Date or within such further period as a court may allow, apply to a court to fix a fair value for Company Shares of Dissenting Shareholders. If Acquireco fails to apply to a court, a Dissenting Shareholder may apply to a court for the same purpose within a further period of 20 days or within such further periods as a court may allow. A Dissenting Shareholder is not required to give security for costs in such an application.

Upon an application to a court, all Dissenting Shareholders whose Dissenting Shares have not been purchased by Acquireco should be joined as parties and bound by the decision of the court, and Acquireco will be required to notify each affected Dissenting Shareholder of the date, place and consequences of the application and of such Dissenting Shareholder’s right to appear and be heard in person or by counsel. Upon any such application to a court, the court may determine whether any person is a Dissenting Shareholder who should be joined as a party, and the court will then fix a fair value for the Dissenting Shares of all Dissenting Shareholders. The final order of a court will be rendered against Acquireco in favour of each Dissenting Shareholder for the amount of the fair value of its Dissenting Shares as fixed by the court. The court may, in its discretion, allow a reasonable rate of interest on the amount payable to each Dissenting Shareholder from the Effective Date until the date of payment.

Registered Shareholders who are considering exercising Dissent Rights should be aware that there can be no assurance that the fair value of their Company Shares, as determined under the applicable provisions of the CBCA (as modified by the Plan of Arrangement, the Interim Order and the Final Order), will be more than or equal to the Consideration under the Arrangement. In addition, any judicial determination of fair value will result in delay of receipt by a Dissenting Shareholder of consideration for such Dissenting Shareholder’s Dissenting Shares.

The foregoing is only a summary of the Dissenting Shareholder provisions of the CBCA (as modified by the Interim Order and the Final Order), which are technical and complex. A complete copy of Section 190 of the CBCA is attached as Appendix G to this Circular. It is recommended that any Registered Shareholder wishing to avail itself of its Dissent Rights under those provisions seek legal advice, as failure to comply strictly with the provisions of the CBCA (as modified by the Plan of Arrangement, the Interim Order and the Final Order) may prejudice its Dissent Rights. For a summary of certain Canadian tax implications to a Dissenting Shareholder, see “Certain Canadian Federal Income Tax Considerations” in this Circular.

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RISK FACTORS RELATED TO THE ARRANGEMENT

1. There are various risks associated with the completion of the Arrangement, including those described below. These risk factors should be carefully considered by Shareholders in evaluating whether to vote for the Arrangement Resolution. In addition to those risk factors set forth under the heading “Information Concerning Inter-Citic — Risk Factors Related to Inter-Citic” in this Circular.

2. The completion of the Arrangement is subject to a number of conditions precedent which must be satisfied or, where permitted, waived, and some of such conditions precedent are outside the control of Parent and Inter-Citic, including the receipt of the Shareholder approvals, the Final Order and the Regulatory Approvals. It is also a condition in favour of Parent and Acquireco that, from the date of the Arrangement Agreement to and including the Effective Time, there shall not have occurred a Material Adverse Effect in respect of Inter-Citic. See “The Arrangement Agreement — Conditions Precedent to the Arrangement” in this Circular. There can be no certainty, nor can Inter-Citic provide any assurance, that these and other conditions precedent under the Arrangement Agreement will be satisfied or, if satisfied, when they will be satisfied.

3. If the Arrangement is not completed, for any reason, the market price of Company Sharesmay be adversely affected, among other potential consequences. Moreover, if the Arrangement Agreement is terminated, there is no assurance that the Directors will be able to find a party willing to pay an equivalent or a more attractive price for Company Shares than the price that Parent is willing to pay for Company Shares under the Arrangement.

4. Each of Inter-Citic, Parent and Acquireco has the right, in certain circumstances, in addition to termination rights relating to the failure to satisfy the conditions precedent, to terminate the Arrangement Agreement in other circumstances. For example, the Arrangement Agreement may be terminated by Parent if Inter-Citic breaches its non-solicitation and right to match obligations in a material respect. Accordingly, there can be no certainty, nor can Inter-Citic provide any assurance, that the Arrangement Agreement will not be terminated by any of the parties thereto prior to the completion of the Arrangement. See “The Arrangement Agreement — Termination” in this Circular.

5. In addition, the Termination Fee payable by Inter-Citic to Parent under the Arrangement Agreement in certain circumstances may discourage other parties from attempting to acquire Inter-Citic. See “The Arrangement Agreement — Termination Fee, Break-Up Fee and Expenses — Termination Fee” in this Circular.

OTHER INFORMATION AND MATTERS

There is no information or matter not disclosed in this Circular but known to Inter-Citic that would reasonably be expected to affect the decision of Shareholders to vote for or against the Arrangement Resolution.

DEPOSITARY

Parent, Acquireco and Inter-Citic intend to engage Computershare Investor Services Inc. to act as depositary for the receipt of certificates representing Company Shares and related Letters of Transmittal deposited pursuant to the Arrangement. The Depositary will receive reasonable and customary compensation for its services in connection with the Arrangement, will be reimbursed for certain out-of-pocket expenses and will be indemnified by Parent, Acquireco and Inter-Citic

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against certain liabilities arising out of or in connection with its engagement and expenses in connection therewith.

No fee or commission is payable by any Shareholder who transmits its Company Shares directly to the Depositary. Except as set forth above or elsewhere in this Circular, Inter-Citic will not pay any fees or commissions to any broker or dealer or any other person for soliciting deposits of Company Shares pursuant to the Arrangement.

LEGAL MATTERS

Certain legal matters in connection with the Arrangement will be passed upon on behalf of Inter-Citic by Miller Thomson LLP and on behalf of Parent and Acquireco by Stikeman Elliott LLP. The partners and associates of Miller Thomson LLP own beneficially, directly or indirectly, in each case, less than 1% of the outstanding securities of Inter-Citic and its associates and affiliates.

WHERE YOU CAN FIND MORE INFORMATION

Information contained in this Circular is given as of October 3, 2012, except as otherwise noted and except that information incorporated by reference in this Circular is given as of the respective dates noted therein.

Additional financial and other information concerning Inter-Citic, including:

! Inter-Citic’s annual information form dated February 25, 2012 for the fiscal year ended November 30, 2011,

! Inter-Citic’s audited consolidated financial statements for the fiscal year ended November 30, 2011, together with the report of Inter-Citic’s auditors thereon, and management’s discussion and analysis for the fiscal year ended November 30, 2011,

! Inter-Citic’s consolidated interim financial statements (unaudited) for the quarter ended May 31, 2012 and management’s discussion and analysis for the quarter ended May 31, 2012, and

! Inter-Citic’s consolidated interim financial statements (unaudited) for the quarter ended February 29, 2012 and management’s discussion and analysis for the quarter ended February 29, 2012

can be found on SEDAR at www.sedar.com. Copies of those documents, as well as any additional copies of this Circular, are available upon written request to Inter-Citic’s corporate secretary, free of charge or, where applicable, upon payment of a reasonable charge, at 60 Columbia Way, Suite 501, Markham, Ontario L3R 0C9 (Attention: Vice-President, Corporate Communications).

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APPROVAL OF INTER-CITIC MINERALS INC.

The contents and the mailing of this Management Proxy Circular have been approved by the Board of Directors of Inter-Citic Minerals Inc.

DATED October 3, 2012

On behalf of the Board of Directors of Inter-Citic Minerals Inc.



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CONSENT OF STANDARD CHARTERED

We refer to the opinion dated August 24, 2012 (the “Standard Chartered Opinion”), whichGryphon Partners Canada Inc., a wholly-owned subsidiary of Standard Chartered Bank,prepared solely for the Special Committee of the Board of Directors (the “Special Committee”) and the Board of Directors of Inter-Citic Minerals Inc.

We consent to the inclusion of the Standard Chartered Opinion in Inter-Citic Minerals Inc.’s Management Proxy Circular dated October 3, 2012 (the “Circular”) and to all references to the Standard Chartered Opinion and the name Gryphon Partners Canada Inc. and the name Standard Chartered contained in the Circular. In providing such consent, we do not intend that any person other than the Special Committee and the Board of Directors of Inter-Citic Minerals Inc. rely upon such opinion.

(signed) “Gryphon Partners Canada Inc.”

Dated October 3, 2012 Gryphon Partners Canada Inc.

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CONSENT OF MILLER THOMSON LLP

We hereby consent to the reference to our opinion contained under the heading “Certain Canadian Federal Income Tax Considerations” in the Management Proxy Circular of Inter-Citic Minerals Inc. dated October 3, 2012 (the “Circular”) and to the inclusion of the foregoing opinion in the Circular.

(signed) “Miller Thomson LLP”

Dated October 3, 2012 Miller Thomson LLP

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GLOSSARY OF TERMS

The following glossary of terms used in this Circular, including the Summary section, but not including the Appendices, is provided for ease of reference:

“Acquireco” means Qing Hai Mining Acquisition Corp., a company existing under the CBCA as an indirect wholly-owned subsidiary of Parent.

“affiliate” has the meaning specified in National Instrument 45-106 – Prospectus and Registration Exemptions.

“allowable capital loss” has the meaning given thereto under the heading “Certain Canadian Federal Income Tax Considerations — Holders Resident in Canada — Taxation of Capital Gains and Capital Losses”.

“Acquisition Proposal” means, other than the transactions contemplated by the Arrangement Agreement and other than any transaction involving only Inter-Citic and/or one or more of its affiliates, any offer, proposal or inquiry (written or oral) from any person or group of persons other than Parent (or any affiliate of Parent or any Person acting in concert with Parent) after August 24, 2012 relating to (i) any sale or disposition (or any lease, long-term supply agreement or other arrangement having the same economic effect as a sale), direct or indirect, of assets of Inter-Citic representing 20% or more of the fair market value of the consolidated assets of Inter-Citic or contributing 20% or more of the consolidated revenue of Inter-Citic and its affiliates, taken as a whole (ii) any take-over bid, exchange offer or other transaction that, if consummated, would result in such Person or group of Persons beneficially owning 20% or more of any class of voting or equity securities of Inter-Citic or rights or interest therein or thereto, (iii) any plan of arrangement, merger, amalgamation, consolidation, share exchange, business combination, reorganization, recapitalization, liquidation, dissolution or winding up involving Inter-Citic or any of its affiliates, or (iv) any other similar transaction or series of transactions involving Inter-Citic or any of its affiliates.

“Appendices” means, collectively, the appendices to this Circular.

“Arrangement” means an arrangement under the provisions of section 192 of the CBCA, on the terms and subject to the conditions set forth in the Plan of Arrangement, subject to any amendments or supplement thereto made in accordance with the Arrangement Agreement and the provisions of the Plan of Arrangement or made at the direction of the Court in the Final Order, in each case with the consent of Inter-Citic and Parent, each acting reasonably.

“Arrangement Agreement” means the Arrangement Agreement made as of August 24, 2012 among Parent, Acquireco and Inter-Citic, as it may be amended, supplemented or otherwise modified in accordance with its terms, providing for, among other things, the Arrangement.

“Arrangement Resolution” means the special resolution of the Company Shareholders approving the Arrangement and presented at the Company Shareholder Meeting substantially in the form attached as Appendix A to this Circular, such form and content agreed by Inter-Citic and Parent, each acting reasonably.

“Articles of Arrangement” means the articles of arrangement of the Company in respect of the Arrangement, required under the CBCA to be sent to the CBCA Director after the Final Order is made, which shall include the Plan of Arrangement and otherwise be in a form and content satisfactory to the Company and Parent, each acting reasonably.

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“Board” or “Board of Directors” means the board of directors of Inter-Citic, as constituted from time to time.

“Break-Up Fee” means the amount of $7 million payable by Parent to Inter-Citic as liquidated damages in the circumstances described in Section 8.3 of the Arrangement Agreement.

“business day” means a day which is not a Saturday, Sunday or a civic or statutory holiday in Beijing, PRC or Toronto, Ontario.

“Canadian GAAP” means Canadian generally accepted accounting principles at the relevant time, applied on a consistent basis, as set out in the Handbook of the Canadian Institute of Chartered Accountants.

“Canadian Securities Administrators” means, collectively, the securities commissions or other similar regulatory authorities in each of the provinces and territories of Canada.

“CBCA” means the Canada Business Corporations Act and the regulations made thereunder, as amended.

“CBCA Director” means the director appointed pursuant to section 260 of the CBCA.

“CDS” means CDS Clearing and Depositary Services Inc.

“Certificate of Arrangement” means the certificate of arrangement to be issued by the CBCA Director pursuant to subsection 192(7) of the CBCA in respect of the Articles of Arrangement.

“Change in Recommendation” means (a) any withdrawal, modification or qualification (or a public proposal to withdraw, modify or qualify) in any manner adverse to Parent and/or the consummation of the Arrangement, of the recommendation of the Board or any committee thereof, that the Company Shareholders vote in favour of the Arrangement Resolution, (b) the failure of Inter-Citic to reaffirm its recommendation of the Arrangement within 5 (five) business days (and in any case prior to the Company Shareholder Meeting) after having been reasonably requested in writing by Parent to do so, or (c) any approval, acceptance or recommendation by the Board of, or public proposal by the Board to, approve, accept or recommend, or publicly taking no position or a neutral position with respect to, any Acquisition Proposal other than the Arrangement (provided that publicly taking a neutral position or no position with respect to an Acquisition Proposal until the seventh business day after receipt of an Acquisition Proposal shall not and shall be deemed not to be Change in Recommendation.

“Circular” means this management proxy circular of Inter-Citic, including the Notice of Meeting, all schedules and Appendices to this Circular and all documents incorporated by reference in this Circular, as the same may be amended, supplemented or otherwise modified from time to time.

“COC Benefit” has the meaning given thereto under the heading “Principal Legal Matters —Canadian Securities Law Considerations — Special Transaction Rules”.

“Company” or “Inter-Citic” means Inter-Citic Minerals Inc., a corporation existing under the laws of Canada.

“Company Options” means the outstanding options to purchase the Company Shares issued pursuant to the Company’s Option Plan, as listed in the Company Disclosure Letter.

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“Company Shares” means the common shares which the Company is authorized to issue as presently constituted.

“Confidentiality Agreement” means the confidentiality agreement dated November 29, 2011 between Inter-Citic and Parent.

“Consideration” means the cash consideration to be received by Shareholders pursuant to the Arrangement Agreement and the Plan of Arrangement as consideration for each common share of Inter-Citic outstanding immediately prior to the Effective Time, consisting of $2.05 per common share.

“Court” means the Ontario Superior Court of Justice (Commercial List).

“CRA” means the Canada Revenue Agency.

“D&O Insurance” has the meaning given thereto under the heading “The Arrangement Agreement — Directors’ and Officers’ Insurance and Indemnification — Insurance”.

“Dachang Project” means all exploration and related activities carried out by the Company as described in the Company’s Annual Information Form dated February 25, 2012.

“Demand for Payment” has the meaning given thereto under the heading “Dissenting Registered Shareholders’ Rights”.

“Depositary” means Computershare Investor Services Inc. or any other trust company, bank or financial institution agreed to in writing between Parent and the Company for the purpose of, among other things, acting as depositary for purposes of paying the cash consideration under the Arrangement and certain obligations of the Parent hereunder to provide funds to the Company.

“Directors” means, collectively, the members of the Board of Directors from time to time, and “Director” means any one of them.

“Disclosure Letter” means the disclosure letter dated the date of the Arrangement Agreement regarding the Arrangement Agreement that was provided by Inter-Citic to Parent, in the form approved by Parent.

“Dissenting Non-Resident Holder” has the meaning given thereto under the heading “Certain Canadian Federal Income Tax Considerations — Holders Not Resident in Canada — Dissenting Non-Resident Holders”.

“Dissenting Resident Holder” has the meaning given thereto under the heading “Certain Canadian Federal Income Tax Considerations — Holders Resident in Canada — Dissenting Resident Holders”.

“Dissenting Shareholder” means any Registered Shareholder who has duly exercised its Dissent Rights and has not withdrawn or been deemed to have withdrawn such Dissent Rights, and Company Shares in respect of which Dissent Rights are duly exercised by such Shareholder are referred to as “Dissent Shares”.

“Dissent Notice” means the written objection of a Registered Shareholder to the Arrangement Resolution, submitted to Inter-Citic in accordance with dissent procedures described under the heading “Dissenting Registered Shareholders’ Rights”.

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“Dissent Rights” means the rights of dissent of the Company Shareholders in respect of the Arrangement Resolution.

“EDT” means Eastern Daylight Time.

“Effective Date” means the date shown on the Certificate of Arrangement giving effect to the Plan of Arrangement.

“Effective Time” means the time when the Arrangement will be deemed to have been completed, which shall be 12:01 a.m., Toronto time, on the Effective Date, or such other time as the Parties agree to in writing before the Effective Date.

“Final Order” means the final order of the Court in form and substance acceptable to Inter-Citic and Parent, each acting reasonably, approving the Arrangement, as such order may be amended by the Court (with the consent of both Inter-Citic and Parent, each acting reasonably) at any time prior to the Effective Date or, if appealed, then, unless such appeal is withdrawn or denied, as affirmed or as amended (provided that any such amendment is acceptable to both Inter-Citic and Parent, each acting reasonably) on appeal.

“Financial Statements” means, collectively, the audited consolidated financial statements of Inter-Citic for the fiscal year ended November 30, 2011 (including the notes thereto and the related management’s discussion and analysis) and the unaudited financial statements of Inter-Citic for the six months ended May 31, 2012 (including the notes thereto and the related management’s discussion and analysis).

“forward-looking statements” has the meaning given thereto under the heading “Cautionary Statement Regarding Forward-Looking Statements”.

“Governmental Entity” means (i) any international, multinational, national, federal, provincial, state, regional, municipal, local or other government, governmental or public department, central bank, court, tribunal, arbitral body, commission, board, bureau, ministry, agency or instrumentality, domestic or foreign, (ii) any subdivision or authority of any of the above, (iii) any quasi-governmental or private body exercising any regulatory, expropriation or taxing authority under or for the account of any of the foregoing or (iv) any stock exchange or Securities Authority.

“Holder” or “Holders” has the meaning given thereto under the heading “Certain Canadian Federal Income Tax Considerations — General”.

“IFRS” means Canadian generally accepted accounting principles for publicly accountable enterprises being International Financial Reporting Standards as adopted by the Canadian Accounting Standards Board effective for financial reporting periods beginning on or after January 1, 2011.

“Indemnified Person” has the meaning given thereto under the heading “The Arrangement Agreement — Directors’ and Officers’ Insurance and Indemnification — Indemnification”.

“Interim Order” means the interim order of the Court in a form acceptable to the Company and Parent, each acting reasonably, providing for, among other things, the calling and holding of the Company Shareholder Meeting, as such order may be amended, supplemented or varied by the Court with the consent of the Company and Parent, each acting reasonably.

“Intermediary” means an intermediary with which a Non-Registered Shareholder may deal, including banks, trust companies, securities dealers or brokers and trustees or administrators of

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self-directed trusts governed by registered retirement savings plans, registered retirement income funds, registered education savings plans (collectively, as defined in the Tax Act) and similar plans, and their nominees.

“Joint Venture Agreement” means the cooperative joint venture contract dated November 1, 2011, for mining exploration in Qinghai between No. 5 Institute and the Company.

“Law” means, with respect to any Person, any and all applicable law (statutory, common or otherwise), constitution, treaty, convention, ordinance, code, rule, regulation, order, injunction, judgment, decree, ruling or other similar requirement, whether domestic or foreign, enacted, adopted, promulgated or applied by a Governmental Entity that is binding upon or applicable to such Person or its business, undertaking, property or securities, and to the extent that they have the force of law, policies, guidelines, notices and protocols of any Governmental Entity, as amended.

“Letter of Transmittal” means the letter of transmittal to be forwarded by Inter-Citic to Registered Shareholders in connection with the Arrangement, in the form accompanying this Circular or such other equivalent form of letter of transmittal acceptable to Parent, acting reasonably.

“Lien” means any pledge, claim, lien, charge, option, hypothec, mortgage, security interest, restriction, adverse right, prior assignment, lease, sublease, right to possession or any other encumbrance, right or restriction of any kind or nature whatsoever which affects by way of a conflicting ownership interest or otherwise, the right, title or interest in or to any particular property.

“Matching Period” has the meaning given thereto under the heading “The Arrangement Agreement — Superior Proposal”.

“Material Adverse Effect” means any one or more effects, changes, events, occurrences, results, states of facts or developments which, either individually or in the aggregate, is or would reasonably be expected to be materially adverse to the business, operations, results of operations, assets (including the Dachang Project), liabilities, obligations (whether absolute, accrued, conditional or otherwise), capital, properties or financial condition, of Inter-Citic and its affiliates, taken as a whole but excluding any effect, change, event, occurrence, results, state of facts or development resulting from or arising in connection with:

(a) any change in Canadian GAAP or IFRS or changes in regulatory accounting requirements applicable to the industry in which Inter-Citic or any of its affiliates operate;

(b) any adoption, proposal, implementation or change in applicable Law or interpretations thereof by any Governmental Entity;

(c) any change in global, national or regional political conditions, including acts of war, sabotage or terrorism, or any escalation or worsening of such acts of war, sabotage or terrorism threatened or underway, or declaration of a national emergency or in general economic, business, regulatory, political or market conditions or in national or global financial or capital markets;

(d) changes in foreign exchange or interest rates;

(e) changes affecting the industry generally in which Inter-Citic or any of its affiliates operate;

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(f) the execution, announcement or performance of the Arrangement Agreement, or the pendency or consummation of the transactions contemplated hereby;

(g) earthquakes, hurricanes, tornados or other natural disasters;

(h) any change in the market price or trading volume of the securities of Inter-Citic, or any suspension of trading in securities generally on any securities exchange on which the securities of Inter-Citic trade (it being understood that the causes underlying such change in market price may be taken into account in determining whether a Material Adverse Effect has occurred);

(i) the failure of Inter-Citic in and of itself to meet any internal projections, forecasts or estimates of revenues or earnings or other financial performance or results of operations (it being understood that the causes underlying such failure may be taken into account in determining whether a Material Adverse Effect has occurred);

(j) any actions taken (or omitted to be taken) at the request of Parent or Acquireco or their respective affiliates;

(k) any action taken by Inter-Citic or any of its Subsidiaries that is required or permitted pursuant to the Arrangement Agreement;

(l) the acts or omissions of Parent, Acquireco or any of their respective affiliates; or

(m) (i) the deferral of the negotiation of an agreement with the Bureau of Land and Resources of Qinghai Province regarding minimum exploration expenditures by Inter-Citic in respect of Exploration Licenses until the Effective Time; or (ii) the deferral of the commencement of exploration by Inter-Citic at the Dachang Project until the Effective Time

provided, however, that with respect to clauses (a), (b), (c) and (e) of this definition, such matters do not have a materially disproportionate effect on Inter-Citic and its affiliates taken as a whole, relative to other comparable companies and entities operating in the industry in which Inter-Citic and/or its affiliates operate, and provided, further, that any loss, claim, occurrence, change or effect that, if capable of being cured, is cured within 20 (twenty) business days following receipt of written notice to Inter-Citic by the Parent shall not be considered a Material Adverse Effect.

“Material Contract” means any contract, agreement, licence, franchise, lease, arrangement, commitment, understanding, joint venture, partnership or other right or obligation (written or oral) to which Inter-Citic or any of its affiliates is a party or by which Inter-Citic or any of its affiliates is bound or to which any of their respective properties or assets are subject,

(a) under which Inter-Citic or any of its affiliates has directly or indirectly guaranteed any liabilities or obligations of a third party that is not an affiliate of Inter-Citic or its affiliates;

(b) that is a financial risk management agreement, such as currency, commodity, interest or equity related hedge or derivative agreement;

(c) providing for the establishment, investment in, organization or formation of any joint ventures or partnerships, including the Joint Venture Agreement;

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(d) that limits or restricts Inter-Citic or any of its affiliates in any material respect from engaging in any line of business or from carrying on business in any geographic area or that creates an exclusive dealing arrangement or right of first offer or refusal or contains a similar clause;

(e) that grants any party exclusive rights with respect to any product lines of Inter-Citic or its affiliates (except with respect to sales of such products to customers of Inter-Citic or its affiliates in the Ordinary Course of business),

(f) that contains non-competition, non-solicitation, exclusivity, most favoured nations or similar provisions that, in any material respect, restrict the operations of Inter-Citic or its affiliates or limit the freedom of Inter-Citic or its Subsidiaries (or Parent or Acquireco on or after the closing of the Arrangement as contemplated by the Arrangement Agreement);

(g) that contains a warranty, guaranty, indemnity or similar undertaking extended byInter-Citic or its affiliates, other than in the Ordinary Course of business, consistent with past practice;

(h) that would result in a severance, retention or change of control payment becoming due to any Director, officer, employee, contractor or consultant of Inter-Citic or any of its affiliates in connection with his or her termination or resignation as a consequence of completion of the Arrangement pursuant to the Arrangement Agreement, other than payments required under applicable Laws;

(i) that is a subordination, non-disturbance or attornment agreement relating to real property;

(j) that is or creates any kind of loan or debt obligation or liability, including any financing arrangement, credit facility or similar obligation;

(k) that grants any person an option, warrant, understanding or commitment, or any right or privilege capable of becoming such for the purchase or other acquisition from Inter-Citic of any Company Shares, Company Options or Company Warrants, or by which Company agrees to issue Company Shares to any Person;

(l) that would result in any liability, obligation, expenditure or commitment of more than $500,000 over the life of such contract;

(m) that is with any director, officer or person holding beneficially or of record, 10% or more of Company Shares or any affiliates thereof (other than as described in (h) above); or

(n) that is otherwise material to Inter-Citic and its Subsidiaries, considered as a whole, is not listed above (other than confidentiality agreements entered into in connection with Inter-Citic’s strategic process) and where the consequences of a breach or default thereunder, or the termination, expiration or cancellation thereof, would reasonably be expected to have a Material Adverse Effect.

“Meeting” means the special meeting of Shareholders, including any adjournment or postponement thereof, called and held in accordance with the Interim Order, to consider the Arrangement and the Arrangement Resolution as set out in this Circular.

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“Meeting Materials” means, collectively, this Circular, together with the Notice of Meeting, form of proxy accompanying this Circular and the Letter of Transmittal.

“MI 61-101” means Multilateral Instrument 61-101 — Protection of Minority Security Holders in Special Transactions.

“Miller Thomson” means Miller Thomson LLP, counsel to Inter-Citic in connection with the Arrangement.

“Minority Shareholders” means, collectively, all Shareholders other than James Moore, Lou Pasubio and Garth Pierce.

“misrepresentation” has the meaning given thereto in the Securities Act.

“Non-Resident Holder” or “Non-Resident Holders” has the meaning given thereto under the heading “Certain Canadian Federal Income Tax Considerations — Holders Not Resident in Canada”.

“Non-Registered Shareholder” means a holder of Company Shares who holds such Company Shares beneficially through an Intermediary.

“Notice of Appearance” has the meaning given thereto under the heading “Principal Legal Matters — Court Approval of the Arrangement and Completion of the Arrangement”.

“Notice of Meeting” means the Notice of Special Meeting of Shareholders accompanying this Circular.

“Offer to Pay” means a written offer from Acquireco to each Dissenting Shareholder who has sent a Demand for Payment to pay for its Company Shares in an amount considered by Acquireco to be fair value of Company Shares, all in compliance with the dissent procedures described under the heading “Dissenting Registered Shareholders’ Rights”.

“Option Benefit” has the meaning given thereto under the heading “Principal Legal Matters —Canadian Securities Law Considerations — Special Transaction Rules”.

“Optionholders” means, collectively, the holders of Company Options.

“Ordinary Course” means, with respect to an action taken by the Company, that such action is consistent with the past practices of the Company and is taken in the ordinary course of the normal day-to-day operations of the business of the Company.

“Outside Date” means December 22, 2012, or such later date as may be agreed to in writing by the parties to the Arrangement Agreement.

“Parent” means Western Mining Group Co., Ltd., a company existing under the laws of The People’s Republic of China.

“Parties” means the Company, Parent and Acquireco and “Party” means any one of them.

“Permit” means any licence, permit, certificate, consent, order, grant, approval, classification, registration, franchise, concession, qualification or other authorization of and from any Governmental Entity.

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“person” includes any individual, partnership, association, body corporate, organization, trust, estate, trustee, executor, administrator, legal representative, government (including Governmental Entity), syndicate or other entity, whether or not having legal status.

“Plan of Arrangement” means the plan of arrangement, in the form of Appendix C to this Circular, and any further amendments or variations thereto made in accordance with Section 8.1of the Arrangement Agreement or made at the direction of the Court in the Final Order with the prior written consent of Parent and Inter-Citic, each acting reasonably.

“PRC Approvals” means, collectively, the Regulatory Approvals required to be obtained from the following Governmental Entities in The People’s Republic of China in order for Parent and Acquireco to complete the transactions contemplated by the Arrangement Agreement: (a) the 青海省国有资产监督管理委员会（State-owned Assets Supervision and Administration Commission of Qinghai Province）Approval; (b) the中华人民共和国国家发展和改革委员会（National Development and Reform Commission of the People’s Republic of China) Approval); (c) the 中华人民共和国商务部（Ministry of Commerce of the People’s Republic of China）Approval; (d) the 国家外汇管理局青海省分局（The State Administration of Foreign Exchange Bureau of Qinghai Province）Registration.

“Process” has the meaning given thereto under the heading “The Arrangement — Background to the Arrangement”.

“Proposed Amendments” has the meaning given thereto under the heading “Certain Canadian Federal Income Tax Considerations — General”.

“Registered Shareholder” means a holder of Company Shares who holds such Company Shares in his, her or its own name and who is entered on the register of Shareholders.

“Regulatory Approval” means, any consent, waiver, permit, exemption, review, order, decision or approval of, or any registration and filing with, any Governmental Entity, or the expiry, waiver or termination of any waiting period imposed by Law or a Governmental Entity, in each case in connection with the Arrangement, and includes the PRC Approvals.

“Resident Holder” or “Resident Holders” has the meaning given thereto under the heading “Certain Canadian Federal Income Tax Considerations — Holders Resident in Canada”.

“Required Arrangement Vote” means the approval of the Arrangement Resolution by the affirmative vote of (a) not less than 66⅔% of the votes cast on the Arrangement Resolution by the Shareholders and (b) a majority of the votes cast on the Arrangement Resolution by the Minority Shareholders, in each case present in person or represented by proxy at the Meeting.

“Rights Plan” means the amended and restated shareholder rights plan agreement dated April 27, 2010, between Inter-Citic and Computershare Investor Services Inc.

“Securities” means, collectively, Company Shares, Company Options and Warrants.

“Securities Act” means the Securities Act (Ontario) and the rules, regulations and published policies made thereunder, as amended from time to time.

“Securities Laws” means the Securities Act (Ontario) and any other applicable provincial securities Laws.

“Security Holders” means collectively, the Shareholders, Optionholders and Warrantholders.

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“SEDAR” means the System for Electronic Document Analysis and Retrieval maintained by the Canadian Securities Administrators.

“Shareholders” means, collectively, the registered and beneficial holders of Company Shares.

“Sixth Anniversary” means the sixth anniversary of the Effective Date.

“Shareholders’ Approval” means the approval and adoption of the Arrangement Resolution at the Company Shareholder Meeting in accordance with the Interim Order.

“Special Committee” means the special committee of the Board, comprised of independent Directors, established on February 23, 2011 for purposes of exploring and reviewing strategic alternatives available to Inter-Citic.

“SRP Rights” means the rights issuable pursuant to the Rights Plan.

“Standard Chartered” means Gryphon Partners Canada Inc., a wholly-owned subsidiary of Standard Chartered Bank, in its capacity as the exclusive financial advisor to Inter-Citic with respect to the process of reviewing strategic alternatives available to Inter-Citic and as the issuer of the Standard Chartered Opinion.

“Standard Chartered Group” means Standard Chartered Bank and its affiliates (including Gryphon Partners Canada Inc.).

“Standard Chartered Opinion” means the opinion of Standard Chartered, a copy of which is attached as Appendix D to this Circular.

“Stock Option Plan” means the stock option plan of Inter-Citic.

“Subsidiary” means, with respect to a specified body corporate is any body corporate of which the specified body corporate is entitled to elect a majority of the board of directors thereof (whether or not shares of any other class shall or might be entitled to vote upon the happening of any event or contingency) are at the time owned directly or indirectly by such body corporate and shall include any body corporate, partnership, joint venture or other entity over which it exercises direction or control or which is in a like relation to a subsidiary.

“Superior Proposal” means any bona fide written Acquisition Proposal from a person who is an arm’s length third party to Inter-Citic to acquire not less than all of the outstanding Company Shares, or all or substantially all of the assets of Inter-Citic on a consolidated basis, that complies with Securities Laws, and did not result from a breach of Section 5.1 of the Arrangement Agreement and:

(a) is reasonably capable of being completed in accordance with its terms without undue delay, taking into account all financial, legal, regulatory and other aspects of such proposal and the Person making such proposal;

(b) if any consideration is cash, is not subject to any financing condition and in respect of which adequate arrangements have been made and demonstrated to ensure that the required funds are reasonably likely to be available to effect payment in full for all of Company Shares or all or substantially all of the consolidated assets of Inter-Citic, as the case may be;

(c) if any consideration is in the form of securities the Board shall have considered the weighted average trading price of such securities over a period of time determined

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by the Board in its sole discretion (but such time period shall be not less than twenty (20) business days prior to the announcement of the Acquisition Proposal), the effect on value of such shares of the dilution resulting from the issuance of securities as consideration in the Acquisition Proposal, and the liquidity in the market for the securities;

(d) is not subject to any due diligence condition; and

(e) that the Board determines, in its good faith judgment, after receiving the advice of its outside legal and financial advisors and after taking into account all the terms and conditions of the Acquisition Proposal, including all legal, financial, regulatory and other aspects of such Acquisition Proposal and the party making such Acquisition Proposal, would, if consummated in accordance with its terms, but without assuming away the risk of non-completion, result in a transaction which is on terms and conditions that are more favourable, from a financial point of view, to Company Shareholders than those contemplated by the Arrangement Agreement.

“Tax Act” means the Income Tax Act (Canada) and the regulations made thereunder, asamended from time to time.

“taxable capital gain” has the meaning given thereto under the heading “Certain Canadian Federal Income Tax Considerations — Holders Resident in Canada — Taxation of Capital Gains and Capital Losses”.

“Taxes” means 1. any and all taxes, duties, fees, excises, premiums, assessments, imposts, levies and other charges or assessments of any kind whatsoever imposed by any Governmental Entity, whether computed on a separate, consolidated, unitary, combined or other basis, including those levied on, or measured by, or described with respect to, income, gross receipts, profits, gains, windfalls, capital, capital stock, production, recapture, transfer, land transfer, license, gift, occupation, wealth, environment, net worth, indebtedness, surplus, sales, goods and services, harmonized sales, use, value-added, excise, special assessment, stamp, withholding, business, franchising, real or personal property, health, employee health, payroll, workers’ compensation, employment or unemployment, severance, social services, social security, education, utility, surtaxes, customs, import or export, and including all license and registration fees and all employment insurance, health insurance and government pension plan premiums or contributions; 2. all interest, penalties, fines, additions to tax or other additional amounts imposed by any Governmental Entity on or in respect of amounts of the type described in clause (i) above or this clause (ii); 3. any liability for the payment of any amounts of the type described in clauses (i) or (ii) as a result of being a member of an affiliated, consolidated, combined or unitary group for any period; and 4. any liability for the payment of any amounts of the type described in clauses (i) or (ii) as a result of any express or implied obligation to indemnify any other Person or as a result of being a transferee or successor in interest to any party.

“Termination Fee” means the amount of $7 million payable by Inter-Citic to Parent as liquidated damages in the circumstances described in Section 8.2(2) of the Arrangement Agreement and otherwise in accordance with its terms.

“Termination Fee Event” means the termination of the Arrangement Agreement in the circumstances described in Section 8.2(2) of the Arrangement Agreement.

“Transfer Agent” means Computershare Investor Services Inc. in its capacity as transfer agent and registrar of Company Shares.

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“TSX” means the Toronto Stock Exchange.

“Voting Support Agreements” means, collectively, the voting support agreements dated August 24, 2012 between Parent and all of the Directors and two senior officers, as further described under the heading “The Arrangement — Voting Support Agreements”.

“Warrantholders” means, collectively, the holders of Warrants.

“Warrants” means the outstanding warrants of Inter-Citic as set forth in the Disclosure Letter.

“Wilful Breach” means a breach that is a consequence of an act undertaken by the breaching party with the actual knowledge that the taking of such act would, or would be reasonably expected to, cause a breach of the Arrangement Agreement.

“Zijin Mining” means Zijin Mining Group Co., Ltd.

A - 1

APPENDIX A – ARRANGEMENT RESOLUTION

1. The arrangement (the “Arrangement”) under Section 192 of the Canada Business Corporations Act (the “CBCA”) involving Inter-Citic Minerals Inc. (“Inter-Citic”), Western Mining Group Co., Ltd. (“Parent”), and Parent on behalf of Qing Hai Mining Acquisition Corp. a company incorporated under the CBCA as an indirect wholly owned subsidiary (“Acquireco”) of Parent, all as more particularly described and set forth in the Management Proxy Circular (the “Circular”) of Inter-Citic dated October 3, 2012, accompanying the notice of this meeting (as the Arrangement may be, or may have been, modified or amended in accordance with its terms), is hereby authorized, approved and adopted.

2. The plan of arrangement (the “Plan of Arrangement”), involving Inter-Citic and implementing the Arrangement, the full text of which is set out in Appendix C to the Circular (as the Plan of Arrangement may be, or may have been, modified or amended in accordance with its terms), is hereby authorized, approved and adopted.

3. The arrangement agreement (the “Arrangement Agreement”) between Inter-Citic, Parent and Acquireco, dated August 24, 2012, and all the transactions contemplated therein, the actions of the directors of Inter-Citic in approving the Arrangement and the actions of the directors and officers of Inter-Citic in executing and delivering the Arrangement Agreement and any amendments thereto, are hereby ratified and approved.

4. Inter-Citic is authorized to apply for a final order from the Ontario Superior Court of Justice (Commercial List) to approve the Arrangement on the terms set forth in the Arrangement Agreement and the Plan of Arrangement (as they may be, or may have been, amended, modified or supplemented and as described in the Circular).

5. Notwithstanding that this resolution has been passed (and the Arrangement approved) by the shareholders of Inter-Citic or that the Arrangement has been approved by the Ontario Superior Court of Justice, the directors of Inter-Citic are hereby authorized and empowered, without further notice to, or approval of, the shareholders of Inter-Citic:

(a) to amend the Arrangement Agreement or the Plan of Arrangement to the extent permitted by the Arrangement Agreement or the Plan of Arrangement; or

(b) subject to the terms of the Arrangement Agreement, not to proceed with the Arrangement and related transactions.

6. Any director or officer of Inter-Citic is hereby authorized and directed for and on behalf of Inter-Citic to execute, whether under corporate seal of Inter-Citic or otherwise, and to deliver Articles of Arrangement and such other documents as are necessary or desirable to the Director under the CBCA in accordance with the Arrangement Agreement for filing.

7. Any director or officer of Inter-Citic is hereby authorized, for and on behalf and in the name of Inter-Citic, to execute and deliver, whether under corporate seal of Inter-Citic or otherwise, all such agreements, forms, waivers, notices, certificates, confirmations and other documents and instruments and to do or cause to be done all such other acts and things as in the opinion of such director or officer may be necessary, desirable or useful for the purpose of giving effect to the foregoing resolutions, the Arrangement Agreement and the completion of the Plan of Arrangement in accordance with the terms of the Arrangement Agreement, including:

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(a) all actions required to be taken by or on behalf of Inter-Citic, and all necessary filings and obtaining the necessary approvals, consents and acceptances of appropriate regulatory authorities; and

(b) the signing of the certificates, consents and other documents or declarations required under the Arrangement Agreement or otherwise to be entered into by Inter-Citic,

such determination to be conclusively evidenced by the execution and delivery of such document, agreement or instrument or the doing of any such act or thing.

8. All actions heretofore taken by or on behalf of Inter-Citic in connection with any matter referred to in any of the foregoing items which were in furtherance of the Arrangement are hereby approved, ratified and confirmed in all respects.

APPENDIX B – ARRANGEMENT AGREEMENT

Western Mining Group Co., Ltd.

and

Western Mining Group Co., Ltd. on behalf of a companyto be incorporated by it

and

Inter-Citic Minerals Inc.

ARRANGEMENT AGREEMENT

Dated as of August 24, 2012

TABLE OF CONTENTS

ARTICLE 1INTERPRETATION

Section 1.1 Defined Terms. ....................................................................................................1Section 1.2 Certain Rules of Interpretation. ......................................................................13Section 1.3 Schedules............................................................................................................14

ARTICLE 2THE ARRANGEMENT

Section 2.1 Arrangement......................................................................................................14Section 2.2 Interim Order.....................................................................................................15Section 2.3 The Company Shareholder Meeting ..............................................................15Section 2.4 The Company Circular.....................................................................................17Section 2.5 Final Order.........................................................................................................18Section 2.6 Court Proceedings.............................................................................................18Section 2.7 Articles of Arrangement and Effective Date .................................................19Section 2.8 Payment of Consideration ...............................................................................19Section 2.9 Announcement and Shareholder Communications.....................................20Section 2.10 Performance of Acquireco ...............................................................................21Section 2.11 List of Shareholders ..........................................................................................21

ARTICLE 3REPRESENTATIONS AND WARRANTIES

Section 3.1 Representations and Warranties of the Company .......................................22Section 3.2 Representations and Warranties of Parent and Acquireco .........................22

ARTICLE 4COVENANTS

Section 4.1 Covenants of the Company Regarding the Conduct of Business. .............24Section 4.2 Covenants of the Company Regarding the Arrangement. .........................27Section 4.3 Covenants of Parent Relating to the Arrangement ......................................29Section 4.4 Access to Information.......................................................................................30Section 4.5 Notice and Cure Provisions.............................................................................30Section 4.6 Insurance and Indemnification .......................................................................31

ARTICLE 5ADDITIONAL COVENANTS REGARDING NON-SOLICITATION

Section 5.1 Non-Solicitation.................................................................................................32Section 5.2 Notification of Acquisition Proposals ............................................................35Section 5.3 Right to Match ...................................................................................................35Section 5.4 Breach by Affiliates and Representatives ......................................................37

ARTICLE 6CONDITIONS

Section 6.1 Mutual Conditions Precedent .........................................................................37Section 6.2 Additional Conditions Precedent to the Obligations of Parent..................38Section 6.3 Additional Conditions Precedent to the Obligations of the Company .....39Section 6.4 Satisfaction of Conditions ................................................................................40

ARTICLE 7TERM AND TERMINATION

Section 7.1 Term....................................................................................................................40Section 7.2 Termination........................................................................................................40Section 7.3 Effect of Termination/Survival.......................................................................42

ARTICLE 8GENERAL PROVISIONS

Section 8.1 Amendments .....................................................................................................43Section 8.2 Termination Fees...............................................................................................43Section 8.3 Break-Up Fee .....................................................................................................44Section 8.4 Liquidated Damages and Injunctive Relief ...................................................44Section 8.5 Expenses .............................................................................................................45Section 8.6 Notices. ...............................................................................................................45Section 8.7 Time of the Essence...........................................................................................46Section 8.8 Third Party Beneficiaries..................................................................................47Section 8.9 Waiver.................................................................................................................47Section 8.10 Entire Agreement. .............................................................................................47Section 8.11 Successors and Assigns. ...................................................................................47Section 8.12 Severability.........................................................................................................48Section 8.13 Governing Law..................................................................................................48Section 8.14 Rules of Construction. ......................................................................................48Section 8.15 No Liability. .......................................................................................................48Section 8.16 Language. ...........................................................................................................48Section 8.17 Counterparts. .....................................................................................................48

SCHEDULES

Schedule A PLAN OF ARRANGEMENT

Schedule B ARRANGEMENT RESOLUTION

Schedule C REPRESENTATIONS AND WARRANTIES OF THE COMPANY

Schedule D REGULATORY APPROVALS

ARRANGEMENT AGREEMENT

Arrangement Agreement dated as of August 24, 2012 between Western Mining Group Co., Ltd. (“Parent”), Western Mining Group Co., Ltd. on behalf of a company to be incorporated as its indirect wholly-owned subsidiary under the CBCA (“Acquireco”) and Inter-Citic Minerals Inc. (the “Company”).

WHEREAS Parent desires to acquire all of the outstanding common shares of the Company through Acquireco;

AND WHEREAS the Parties intend to carry out the transactions contemplated in this Agreement by way of a plan of arrangement under the provisions of the CBCA;

AND WHEREAS the Company Board has determined, after receiving financial and legal advice that the Arrangement is in the best interests of the Company, and the CompanyBoard has resolved to unanimously recommend that the Company Shareholders vote in favour of the Arrangement Resolution, all subject to the terms and the conditions contained in this Agreement;

AND WHEREAS concurrently with the execution of this Agreement, and as a condition and inducement to Parent’s willingness to enter into this Agreement, certain Company Shareholders are entering into Voting Support Agreements (as hereinafter defined), pursuant to which such parties have agreed, subject to the terms and conditions thereof, to support and vote in favour of the Plan of Arrangement (as hereinafter defined).

AND WHEREAS concurrently with the execution of this Agreement, and as a condition and inducement to the willingness of the Company to enter into this Agreement, Parent HK Subsidiary has entered into the Escrow Agreement (as hereinafter defined) and deposited with the escrow agent under the Escrow Agreement the amount of $7,000,000 as security for the performance of certain of Parent and Acquireco’s obligations under this Agreement.

THIS AGREEMENT WITNESSES THAT in consideration of the covenants and agreements herein contained and other good and valuable consideration (the receipt and sufficiency of which are hereby acknowledged), the Parties hereto covenant and agree as follows:

ARTICLE 1INTERPRETATION

Section 1.1 Defined Terms.As used in this Agreement, unless the context otherwise requires, the following

terms have the following meanings:

“Acquireco” means the company to be incorporated as an indirect wholly owned subsidiary of Parent under the Canada Business Corporations Act.

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“Acquisition Proposal” means, other than the transactions contemplated by this Agreement and other than any transaction involving only the Company and/or one or more of its affiliates, any offer, proposal or inquiry (written or oral) from any Person or group of Persons other than Parent (or any affiliate of Parent or any Person acting in concert with Parent) after the date of this Agreement relating to (i) any sale or disposition (or any lease, long-term supply agreement or other arrangement having the same economic effect as a sale), direct or indirect, of assets of the Company representing 20% or more of the fair market value of the consolidated assets of the Company or contributing 20% or more of the consolidated revenue of the Company and its affiliates, taken as a whole (ii) any take-over bid, exchange offeror other transaction that, if consummated, would result in such Person or group of Persons beneficially owning 20% or more of any class of voting or equity securities of the Company or rights or interest therein or thereto, (iii) any plan of arrangement, merger, amalgamation, consolidation, share exchange, business combination, reorganization, recapitalization, liquidation, dissolution or winding up involving the Company or any of its affiliates, or (iv) any other similar transaction or series of transactions involving the Company or any of its affiliates.

“affiliate” has the meaning specified in National Instrument 45-106 – Prospectus and Registration Exemptions.

“Agreement” means this arrangement agreement, together with the Schedules attached hereto, as the same may be amended, supplemented or otherwise modified from time to time in accordance with the terms hereof.

“Arrangement” means an arrangement under the provisions of section 192 of the CBCA, on the terms and subject to the conditions set forth in the Plan of Arrangement, subject to any amendments or supplement thereto made in accordance with this Agreement and the provisions of the Plan of Arrangement or made at the direction of the Court in the Final Order, in each case with the consent of the Company and Parent, each acting reasonably.

“Arrangement Resolution” means the special resolution of the Company Shareholders approving the Arrangement and presented at the Company Shareholder Meeting substantially in the form of Schedule B, such form and content agreed by the Company and Parent, each acting reasonably.

“Articles of Arrangement” means the articles of arrangement of the Company in respect of the Arrangement, required under the CBCA to be sent to the Director after the Final Order is made, which shall include the Plan of Arrangement and otherwise be in a form and content satisfactory to the Company and Parent, each acting reasonably.

“associate” has the meaning specified in the Securities Act (Ontario).

“Authorization” means with respect to any Person, any order, permit, approval, consent, waiver, licence or similar authorization of any Governmental Entity having jurisdiction over the Person.

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“Break-Up Fee” has the meaning specified in Section 8.3.

“Business Day” means a day which is not a Saturday, Sunday or a civic or statutory holiday in Beijing, PRC or Toronto, Ontario.

“Canadian GAAP” means Canadian generally accepted accounting principles at the relevant time, applied on a consistent basis, as set out in the Handbook of the Canadian Institute of Chartered Accountants;

“CBCA” means the Canada Business Corporations Act, as amended.

“Certificate of Arrangement” means the certificate of arrangement to be issued by the Director pursuant to subsection 192(7) of the CBCA in respect of the Articles of Arrangement.

“Change in Recommendation” means (a) any withdrawal, modification orqualification (or a public proposal to withdraw, modify or qualify) in any manner adverse to Parent and/or the consummation of the Arrangement, of the recommendation of the Company Board or any committee thereof, that theCompany Shareholders vote in favour of the Arrangement Resolution, (b) the failure of the Company to reaffirm its recommendation of the Arrangement within 5 (five) Business Days (and in any case prior to the Company Shareholder Meeting) after having been reasonably requested in writing by Parent to do so, including in accordance with Section 5.3(4), or (c) any approval, acceptance or recommendation by the Company Board of, or public proposal by the Company Board to, approve, accept or recommend, or publicly taking no position or a neutral position with respect to, any Acquisition Proposal other than the Arrangement (provided that publicly taking a neutral position or no position with respect to an Acquisition Proposal until the seventh Business Day after receipt of an Acquisition Proposal shall not and shall be deemed not to be Change in Recommendation.

“Company” means Inter-Citic Minerals Inc., a company established and existing under the CBCA.

“Company Board” means the board of directors of the Company as constituted from time to time.

“Company Board Recommendation” means has the meaning specified in Section 2.4(2).

“Company Circular” means the notice of the Company Shareholder Meeting and accompanying management proxy circular, including all schedules, appendices and exhibits to, and information incorporated by reference in, such management proxycircular, to be sent to the Company Shareholders in connection with the Company Shareholder Meeting, as amended, supplemented or otherwise modified from timeto time in accordance with the terms of this Agreement.

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“Company Disclosure Letter” means the disclosure letter dated the date of this Agreement and delivered by the Company to Parent with this Agreement.

“Company Filings” means all documents publicly filed under the profile of the Company on the System for Electronic Document Analysis Retrieval (SEDAR) sinceJanuary 1, 2010.

“Company Optionholders” means the holders of Company Options.

“Company Option Plan” means the 2007 stock option plan of the Company.

“Company Options” means the outstanding options to purchase the Company Shares issued pursuant to the Company’s Option Plan, as listed in the Company Disclosure Letter.

“Company Public Documents” means all forms, reports, schedules, statements and other documents filed by the Company since November 30, 2009, with all applicable Government Entities.

“Company Securityholders” means, collectively, the Company Shareholders, and holders of the Company Options and the Company Warrants;

“Company Shareholder Approval” means the approval and adoption of the Arrangement Resolution at the Company Shareholder Meeting in accordance with the Interim Order.

“Company Shareholders” means the registered or beneficial holders of the Company’s Shares, as the context requires.

“Company Shareholder Meeting” means the special meeting of the Company Shareholders, including any adjournment or postponement of such special meeting in accordance with the terms of this Agreement, to be called and held in accordance with the Interim Order to consider the Arrangement Resolution and for any other purpose as may be set out in the Company Circular.

“Company Shares” means the common shares which the Company is authorized to issue as presently constituted.

“Company Warrants” means the outstanding warrants of the Company as set forth in the Company Disclosure Letter.

“Consideration” means $2.05 per the Company Share in cash.

“Confidentiality Agreement” means the confidentiality agreement between the Company and Parent signed on November 29, 2011.

“Constating Documents” means articles of incorporation, amalgamation, or continuation, as applicable, by-laws and all amendments to such articles or by-laws.

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“contract” means any legally binding agreement, commitment, engagement, contract, franchise, licence, obligation or undertaking (written or oral) to which the Company or any of its affiliates is a party or by which it or any of its affiliates is bound or affected or to which any of their respective properties or assets is subject.

“Court” means the Ontario Superior Court of Justice (Commercial List).

“D&O Insurance” has the meaning specified in Section 4.6(b).

“Dachang Project” means all exploration and related activities carried out by the Company as described in the Company’s Annual Information Form dated February 25, 2012.

“Depositary” means Computershare Trust Company of Canada or any other trust company, bank or financial institution agreed to in writing between Parent and the Company for the purpose of, among other things, acting as depositary for purposes of paying the cash consideration under the Arrangement and certain obligations of the Parent hereunder to provide funds to the Company.

“Director” means the Director appointed pursuant to section 260 of the CBCA.

“Dissent Rights” means the rights of dissent of the Company Shareholders in respect of the Arrangement Resolution.

“Effective Date” means the date shown on the Certificate of Arrangement giving effect to the Plan of Arrangement.

“Effective Time” means the time when the Arrangement will be deemed to have been completed, which shall be 12:01 a.m., Toronto time, on the Effective Date, or such other time as the Parties agree to in writing before the Effective Date.

“Encumbrance” means any mortgage, hypothec, pledge, assignment, charge, lien, claim, security interest, adverse interest, other third person interest or encumbrance of any kind, whether contingent or absolute and any agreement, option, right or privilege (whether by law, contract or otherwise) capable of becoming any of the foregoing.

“Environmental Laws” means all Law and agreements with Governmental Entities and all other statutory requirements relating to public health or the protection of the environment and all Authorizations issued pursuant to such Law, agreements or other statutory requirements.

“Escrow Agreement” means the escrow agreement dated as of the date hereof among Parent HK Subsidiary, the Company and Computershare Trust Company ofCanada as escrow agent.

“Exchange” means the Toronto Stock Exchange.

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“Final Order” means the final order of the Court in a form acceptable to the Company and Parent, each acting reasonably, approving the Arrangement, as such order may be amended by the Court (with the consent of the Company and Parent, each acting reasonably) at any time prior to the Effective Date or, if appealed, then unless such appeal is withdrawn or denied, as affirmed or as amended (provided that any such amendment is acceptable to both the Company and Parent, each acting reasonably) on appeal.

“Financing” has the meaning specified in Section 3.2(1)(g).

“Financing Letter” has the meaning specified in Section 3.2(1)(g).

“Governmental Entity” means (i) any international, multinational, national, federal, provincial, state, regional, municipal, local or other government, governmental or public department, central bank, court, tribunal, arbitral body, commission, board, bureau, ministry, agency or instrumentality, domestic or foreign, (ii) any subdivision or authority of any of the above, (iii) any quasi-governmental or private body exercising any regulatory, expropriation or taxing authority under or for the account of any of the foregoing or (iv) any stock exchange or Securities Authority.

“IFRS” means Canadian generally accepted accounting principles for publicly accountable enterprises being International Financial Reporting Standards as adopted by the Canadian Accounting Standards Board effective for financial reporting periods beginning on or after January 1, 2011.

“Indemnified Persons” has the meaning specified in Section 8.8(1).

“Interim Order” means the interim order of the Court in a form acceptable to the Company and Parent, each acting reasonably, providing for, among other things, the calling and holding of the Company Shareholder Meeting, as such order may be amended, supplemented or varied by the Court with the consent of the Company and Parent, each acting reasonably.

“Joint Venture Agreement” means the cooperative joint venture contract dated November 1, 2011, for mining exploration in Qinghai between No. 5 Institute and the Company.

“Joint Venture” means the Qinghai Geological Survey Institute International Joint Venture Company (青海中加合作大有限公司场矿业 ), which is a Sino-foreign cooperative joint venture company established in 2003 with approval of the Ministry of Commerce of the PRC.

“Law” means, with respect to any Person, any and all applicable law (statutory, common or otherwise), constitution, treaty, convention, ordinance, code, rule, regulation, order, injunction, judgment, decree, ruling or other similar requirement, whether domestic or foreign, enacted, adopted, promulgated or applied by a Governmental Entity that is binding upon or applicable to such Person or its business, undertaking, property or securities, and to the extent that they have the

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force of law, policies, guidelines, notices and protocols of any Governmental Entity, as amended.

“Lenders” has the meaning specified in Section 3.2(1)(g).

“Matching Period” has the meaning specified in Section 5.3(1)(e).

“Material Adverse Effect” means any one or more effects, changes, events, occurrences, results, states of facts or developments which, either individually or in the aggregate, is or would reasonably be expected to be materially adverse to the business, operations, results of operations, assets (including the Dachang Project), liabilities, obligations (whether absolute, accrued, conditional or otherwise), capital, properties or financial condition, of the Company and its affiliates, taken as a whole but excluding any effect, change, event, occurrence, results, state of facts or development resulting from or arising in connection with:

(a) any change in Canadian GAAP or IFRS or changes in regulatory accounting requirements applicable to the industry in which the Company or any of its affiliates operate;

(b) any adoption, proposal, implementation or change in applicable Law or interpretations thereof by any Governmental Entity;

(c) any change in global, national or regional political conditions, including acts of war, sabotage or terrorism, or any escalation or worsening of such acts of war, sabotage or terrorism threatened or underway, or declaration of a national emergency or in general economic, business, regulatory, political or market conditions or in national or global financial or capital markets;

(d) changes in foreign exchange or interest rates;

(e) changes affecting the industry generally in which the Company or any of its affiliates operate;

(f) the execution, announcement or performance of this Agreement, or the pendency or consummation of the transactions contemplated hereby;

(g) earthquakes, hurricanes, tornados or other natural disasters;

(h) any change in the market price or trading volume of the securities of the Company, or any suspension of trading in securities generally on any securities exchange on which the securities of the Company trade (it being understood that the causes underlying such change in market price may be taken into account in determining whether a Material Adverse Effect has occurred);

(i) the failure of the Company in and of itself to meet any internal projections, forecasts or estimates of revenues or earnings or other financial performance

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or results of operations (it being understood that the causes underlying such failure may be taken into account in determining whether a Material Adverse Effect has occurred);

(j) any actions taken (or omitted to be taken) at the request of Parent or Acquireco or their respective affiliates;

(k) any action taken by the Company or any of its Subsidiaries that is required or permitted pursuant to this Agreement;

(l) the acts or omissions of Parent, Acquireco or any of their respective affiliates;or

(m) (i) the deferral of the negotiation of an agreement with the Bureau of Land and Resources of Qinghai Province regarding minimum exploration expenditures by the Company in respect of Exploration Licenses until the Effective Time; or (ii) the deferral of the commencement of exploration by the Company at the Dachang Project until the Effective Time

provided, however, that with respect to clauses (a), (b), (c) and (e) of this definition, such matters do not have a materially disproportionate effect on the Company and its affiliates taken as a whole, relative to other comparable companies and entities operating in the industry in which the Company and/or its affiliates operate, and provided, further, that any loss, claim, occurrence, change or effect that, if capable of being cured, is cured within 20 (twenty) Business Days following receipt of written notice to the Company by the Parent shall not be considered a Material Adverse Effect.

“Material Contract” means any contract, agreement, licence, franchise, lease, arrangement, commitment, understanding, joint venture, partnership or other right or obligation (written or oral) to which the Company or any of its affiliates is a party or by which the Company or any of its affiliates is bound or to which any of their respective properties or assets are subject,

(a) under which the Company or any of its affiliates has directly or indirectly guaranteed any liabilities or obligations of a third party that is not an affiliate of the Company or its affiliates;

(b) that is a financial risk management agreement, such as currency, commodity, interest or equity related hedge or derivative agreement;

(c) providing for the establishment, investment in, organization or formation of any joint ventures or partnerships, including the Joint Venture Agreement;

(d) that limits or restricts the Company or any of its affiliates in any material respect from engaging in any line of business or from carrying on business in any geographic area or that creates an exclusive dealing arrangement or right of first offer or refusal or contains a similar clause;

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(e) that grants any party exclusive rights with respect to any product lines of the Company or its affiliates (except with respect to sales of such products to customers of the Company or its affiliates in the Ordinary Course of business),

(f) that contains non-competition, non-solicitation, exclusivity, most favoured nations or similar provisions that, in any material respect, restrict the operations of the Company or its affiliates or limit the freedom of the Company or its Subsidiaries (or Parent or Acquireco on or after the closing of the Arrangement as contemplated by this Agreement);

(g) that contains a warranty, guaranty, indemnity or similar undertakingextended by the Company or its affiliates, other than in the Ordinary Course of business, consistent with past practice;

(h) that would result in a severance, retention or change of control payment becoming due to any director, officer, employee, contractor or consultant of the Company or any of its affiliates in connection with his or her termination or resignation as a consequence of completion of the Arrangement pursuant to this Agreement, other than payments required under applicable Laws;

(i) that is a subordination, non-disturbance or attornment agreement relating to real property;

(j) that is or creates any kind of loan or debt obligation or liability, including any financing arrangement, credit facility or similar obligation;

(k) that grants any person an option, warrant, understanding or commitment, or any right or privilege capable of becoming such for the purchase or other acquisition from the Company of any the Company Shares, the Company Options or the Company Warrants, or by which the Company agrees to issue the Company Shares to any Person;

(l) that would result in any liability, obligation, expenditure or commitment of more than $500,000 over the life of such contract;

(m) that is with any director, officer or person holding beneficially or of record, 10% or more of the Company Shares or any affiliates thereof (other than as described in (h) above); or

(n) that is otherwise material to the Company and its Subsidiaries, considered as a whole, is not listed above (other than confidentiality agreements entered into in connection with the Company’s strategic process) and where the consequences of a breach or default thereunder, or the termination, expiration or cancellation thereof, would reasonably be expected to have a Material Adverse Effect.

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“Misrepresentation” means an untrue statement of a material fact or an omission to state a material fact required or necessary to make the statements contained therein not misleading in light of the circumstances in which they are made.

“NI 43-101” means National Instrument 43-101 – Standards of Disclosure for Mineral Projects.

“No. 5 Institute” means Qinghai No.5 Geological and Mineral Exploration Institute (青海中加合作大有限公司场矿业 ), which is a body incorporated in the province of Qinghai, PRC with an office at No.42, Chaoyang Road West, Xining Qinghai, PRC.

“officer” has the meaning specified in the Securities Act (Ontario).

“Ordinary Course” means, with respect to an action taken by the Company, that such action is consistent with the past practices of the Company and is taken in the ordinary course of the normal day-to-day operations of the business of the Company.

“Outside Date” means 120 days following the date of this Agreement, or such later date as may be agreed to in writing by the Parties.

“Parent” means Western Mining Group Co., Ltd., a corporation established and existing under the Company Law of the PRC.

“Parent HK Subsidiary” means Western Mining Group (Hong Kong) Company Limited, a corporation established and existing under the laws of Hong Kong.

“Parties” means the Company, Parent and Acquireco and “Party” means any one of them.

“Permitted Liens” means, in respect of the Company or any of its Subsidiaries, any one or more of the following:

(a) Liens for Taxes which are not delinquent;

(b) inchoate or statutory Liens of contractors, subcontractors, mechanics, workers, suppliers, materialmen, carriers and others in respect of the construction, maintenance, repair or operation of an asset, provided that such Liens are related to obligations not due or delinquent, are not registered against title to any such asset and in respect of which adequate holdbacks are being maintained as required by applicable Law; and

(c) the right reserved to or vested in any Governmental Entity by any statutory provision or by the terms of any lease, licence, franchise, grant or permit of the Company or any of its Subsidiaries, to terminate any such lease, licence, franchise, grant or permit, or to require annual or other payments as a condition of their continuance.

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“Person” includes any individual, partnership, association, body corporate, organization, trust, estate, trustee, executor, administrator, legal representative, government (including Governmental Entity), syndicate or other entity, whether or not having legal status.

“Plan of Arrangement” means the plan of arrangement, substantially in the form of Schedule A, subject to any amendments or variations to such plan made in accordance with Section 8.1 or made at the direction of the Court in the Final Order with the prior written consent of the Company and Parent, each acting reasonably.

“PRC” means the People’s Republic of China.

“Regulatory Approval” means, any consent, waiver, permit, exemption, review, order, decision or approval of, or any registration and filing with, any Governmental Entity, or the expiry, waiver or termination of any waiting period imposed by Law or a Governmental Entity, in each case in connection with the Arrangement, and includes those set forth on Schedule D.

“Representative” has the meaning specified in Section 5.1(1).

“Required Approval” has the meaning specified in Section 2.2(iii).

“Rights Plan” means the Amended and Restated Shareholder Rights Plan Agreement dated April 27, 2010 between the Company and Computershare Investor Services Inc.

“Securities Authority” means the Ontario Securities Commission and any other applicable securities commissions or securities regulatory authority of a province or territory of Canada.

“Securities Laws” means the Securities Act (Ontario) and any other applicable provincial securities Laws.

“SRP Rights” means the rights issuable pursuant to the Rights Plan.

“Subsidiary” means, with respect to a specified body corporate is any body corporate of which the specified body corporate is entitled to elect a majority of the board of directors thereof (whether or not shares of any other class shall or might be entitled to vote upon the happening of any event or contingency) are at the time owned directly or indirectly by such body corporate and shall include any body corporate, partnership, joint venture or other entity over which it exercises direction or control or which is in a like relation to a subsidiary.

“Superior Proposal” means any bona fide written Acquisition Proposal from a Person who is an arm’s length third party to the Company to acquire not less than all of the outstanding the Company Shares, or all or substantially all of the assets of the Company on a consolidated basis, that complies with Securities Laws, and did not result from a breach of Section 5.1 and:

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(a) is reasonably capable of being completed in accordance with its terms without undue delay, taking into account all financial, legal, regulatory and other aspects of such proposal and the Person making such proposal;

(b) if any consideration is cash, is not subject to any financing condition and in respect of which adequate arrangements have been made and demonstrated to ensure that the required funds are reasonably likely to be available to effect payment in full for all of the Company Shares or all or substantially all of the consolidated assets of the Company, as the case may be;

(c) if any consideration is in the form of securities the Company Board shall have considered the weighted average trading price of such securities over a period of time determined by the Company Board in its sole discretion (but such time period shall be not less than twenty (20) Business Days prior to the announcement of the Acquisition Proposal), the effect on value of such shares of the dilution resulting from the issuance of securities as consideration in the Acquisition Proposal, and the liquidity in the market for the securities;

(d) is not subject to any due diligence condition; and

(e) that the Company Board determines, in its good faith judgment, after receiving the advice of its outside legal and financial advisors and after taking into account all the terms and conditions of the Acquisition Proposal, including all legal, financial, regulatory and other aspects of such Acquisition Proposal and the party making such Acquisition Proposal, would, if consummated in accordance with its terms, but without assuming away the risk of non-completion, result in a transaction which is on terms and conditions that are more favourable, from a financial point of view, to the Company Shareholders than those contemplated by this Agreement.

“Superior Proposal Notice” has the meaning specified in Section 5.3(1)(c).

“Tax Act” means the Income Tax Act (Canada).

“Tax Returns” means any and all returns, reports, declarations, elections, notices, forms, designations, filings, and statements (including estimated tax returns and reports, withholding tax returns and reports, and information returns and reports) filed or required to be filed in respect of Taxes.

“Taxes” means 1. any and all taxes, duties, fees, excises, premiums, assessments, imposts, levies and other charges or assessments of any kind whatsoever imposed by any Governmental Entity, whether computed on a separate, consolidated, unitary, combined or other basis, including those levied on, or measured by, or described with respect to, income, gross receipts, profits, gains, windfalls, capital, capital stock, production, recapture, transfer, land transfer, license, gift, occupation, wealth, environment, net worth, indebtedness, surplus, sales, goods and services, harmonized sales, use, value-added, excise, special assessment, stamp, withholding, business, franchising, real or personal property, health, employee health, payroll,

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workers’ compensation, employment or unemployment, severance, social services, social security, education, utility, surtaxes, customs, import or export, and including all license and registration fees and all employment insurance, health insurance and government pension plan premiums or contributions; 2. all interest, penalties, fines, additions to tax or other additional amounts imposed by any Governmental Entityon or in respect of amounts of the type described in clause (i) above or this clause (ii); 3. any liability for the payment of any amounts of the type described in clauses (i) or (ii) as a result of being a member of an affiliated, consolidated, combined or unitary group for any period; and 4. any liability for the payment of any amounts of the type described in clauses (i) or (ii) as a result of any express or implied obligation to indemnify any other Person or as a result of being a transferee or successor in interest to any party.

“Termination Fee” has the meaning specified in Section 8.2.

“Termination Fee Event” has the meaning specified in Section 8.2.

“Voting Support Agreements” means collectively, each separate voting support agreement dated as of the date hereof between Parent and each director and executive officer of the Company.

Section 1.2 Certain Rules of Interpretation.In this Agreement, unless otherwise specified:

(1) Headings, etc. The provision of a Table of Contents, the division of this Agreement into Articles and Sections and the insertion of headings are for convenient reference only and do not affect the construction or interpretation of this Agreement.

(2) Currency. All references to dollars or to $ are references to Canadian dollars.

(3) Gender and Number. Any reference to gender includes all genders. Words importing the singular number only include the plural and vice versa.

(4) Certain Phrases and References, etc. The words “including”, “includes” and “include” mean “including (or includes or include) without limitation,” and “the aggregate of”, “the total of”, “the sum of”, or a phrase of similar meaning means “the aggregate (or total or sum), without duplication, of.” Unless stated otherwise,“Article”, “Section”, and “Schedule” followed by a number or letter mean and refer to the specified Article or Section of or Schedule to this Agreement. The term “Agreement” and any reference in this Agreement to this Agreement or any other agreement or document includes, and is a reference to, this Agreement or such other agreement or document as it may have been, or may from time to time be amended, restated, replaced, supplemented or novated and includes all schedules to it.

(5) Capitalized Terms. All capitalized terms used in any Schedule or in the Company Disclosure Letter have the meanings ascribed to them in this Agreement, unless defined therein.

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(6) Knowledge. Where any representation or warranty is expressly qualified by reference to the knowledge of the Company it shall be deemed to refer to the actual knowledge of James Moore, Lou Pasubio and Garth Pierce in their capacity as officers, directors or consultants of the Company, and not in their personal capacities, after making reasonable inquiries regarding the relevant matter. Where any representation or warranty is expressly qualified by reference to the knowledge of Parent, it shall be deemed to refer to the actual knowledge of Mr. Xihong Pan and Mr. Shiwen Xu, in their capacity of officers of Parent and not in their personal capacities, after making reasonable inquiries regarding the relevant matter.

(7) Accounting Terms. Unless otherwise stated, all accounting terms used in this Agreement in respect of the Company shall have, with respect to periods ending before December 1, 2011, the meanings attributable thereto under Canadian GAAP and, with respect to periods ending after December 1, 2011, the meaningsattributable thereto under IFRS, and all determinations of an accounting nature in respect of the Company required to be made shall be made, until December 1, 2011, in a manner consistent with Canadian GAAP and past practice and, thereafter, in a manner consistent with IFRS and, if applicable, consistent with past practice.

(8) Statutes. Any reference to a statute refers to such statute and all rules and regulations made under it, as it or they may have been or may from time to time be amended or re-enacted, unless stated otherwise.

(9) Computation of Time. A period of time is to be computed as beginning on the day following the event that began the period and ending at 4:30 p.m. on the last day of the period, if the last day of the period is a Business Day, or at 4:30 p.m. on the next Business Day if the last day of the period is not a Business Day.

(10) Time References. References to time are to local time, Toronto, Ontario.

(11) Affiliates. To the extent any warranties, covenants or agreements relate, directly or indirectly, to an affiliate of the Company, each such provision shall be construed as a covenant by the Company to cause (to the fullest extent to which it is legally capable) such affiliate to perform the required action.

Section 1.3 Schedules.(1) The schedules attached to this Agreement form an integral part of this Agreement

for all purposes of it.

ARTICLE 2THE ARRANGEMENT

Section 2.1 ArrangementThe Company, Parent and Acquireco agree that the Arrangement will be

implemented in accordance with and subject to the terms and conditions of this Agreement and the Plan of Arrangement.

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Section 2.2 Interim OrderAs soon as reasonably practicable following the execution of this Agreement, but in

any event within 40 (forty) days following the date of this Agreement the Company shall apply to the Court in a manner acceptable to Parent, acting reasonably, pursuant to Section 192 of the CBCA and, in cooperation with Parent, prepare, file and diligently pursue an application for the Interim Order, which shall provide, among other things:

(i) for the class of persons to whom notice is to be provided in respect of the Arrangement and the Company Shareholder Meeting, and for the manner in which such notice is to be provided;

(ii) for confirmation of the record date for the Company Shareholder Meeting referred to in Section 2.3(1).

(iii) that the required level of approval (the “Required Approval”) for the Arrangement Resolution shall be 66 2/3% of the votes cast on the Arrangement Resolution by the Company Shareholders present in person or represented by proxy at the Company Shareholder Meeting.

(iv) that the terms, restrictions and conditions of the Company’s Constating Documents, including quorum requirements and all other matters, shall apply in respect of the Company Shareholder Meeting;

(v) for the grant of the Dissent Rights to those the Company Shareholders who are registered the Company Shareholders;

(vi) for the notice requirements with respect to the presentation of the application to the Court for the Final Order;

(vii) that the Company Shareholder Meeting may be adjourned or postponed from time to time by the Company in accordance with the terms of this Agreement without the need for additional approval of the Court; and

(viii) that the record date for the Company Shareholders entitled to notice of and to vote at the Company Shareholder Meeting will not change in respect of any adjournment(s) or postponement(s) of the Company Shareholder Meeting;

Section 2.3 The Company Shareholder Meeting(1) Subject to the terms of this Agreement, the Company shall:

(a) convene and conduct the Company Shareholder Meeting in accordance with the Interim Order, the Company’s Constating Documents and Law as soon as reasonably practicable, and in any event 70 (seventy) days following the date of this Agreement for the purpose of considering the Arrangement Resolution and for any other proper purpose as may be set out in the Company Circular and agreed to by Parent (such agreement not to be unreasonably withheld or delayed), and provided that this Agreement has

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not been terminated in accordance with its terms, the Company shall not adjourn, postpone or cancel (or propose the adjournment, postponement or cancellation of) the Company Shareholder Meeting without the prior written consent of Parent, except in the case of an adjournment, as required for quorum purposes or as required or permitted under Section 5.3(5);

(b) provided that this Agreement has not been terminated in accordance with its terms, use its commercially reasonable efforts to solicit proxies in favour of the approval of the Arrangement Resolution and against any resolution submitted by any Company Shareholder that is inconsistent with the Arrangement Resolution and the completion of any of the transactions contemplated by this Agreement, including, if so requested by Parent, acting reasonably, using dealer and proxy solicitation services firms to solicit proxies in favour of the approval of the Arrangement Resolution;

(c) provide Parent with copies of or access to information regarding the Company Shareholder Meeting generated by any dealer or proxy solicitations services firm, as requested from time to time by Parent;

(d) in consultation with Parent, fix the date of the Company Shareholder Meeting, give notice to Parent of the Company Shareholder Meeting and allow Parent’s representatives and legal counsel to attend the Company Shareholder Meeting;

(e) promptly advise Parent, at such times as Parent may reasonably request and at least on a daily basis on each of the last ten (10) Business Days prior to the date of the Company Shareholder Meeting, as to the aggregate tally of the proxies received by the Company in respect of the Arrangement Resolution;

(f) promptly advise Parent of any communication from any Company Shareholder in opposition to the Arrangement and/or purported exercise or withdrawal of Dissent Rights, if the Company receives any written notice of dissent, and of any written communications sent by or on behalf of the Company to any Company Shareholder exercising or purporting to exercise Dissent Rights;

(g) not make any payment or settlement offer, or agree to any payment or settlement prior to the Effective Time with respect to Dissent Rights without the prior written consent of Parent, such consent not to be unreasonably withheld or delayed;

(h) not change the record date for the Company Shareholders entitled to vote at the Company Shareholder Meeting in connection with any adjournment or postponement of the Company Shareholder Meeting unless required by Law; and

(i) provided this Agreement has not been terminated in accordance with its terms and notwithstanding the receipt by the Company of a Superior

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Proposal in accordance with Article 5, unless otherwise agreed to in writing by Parent, continue to take all reasonable steps necessary to hold the Company Shareholder Meeting and to cause the Arrangement to be voted on at the Company Shareholder Meeting and not propose to adjourn or postpone the Company Shareholder Meeting other than as contemplated by Section 2.3(1)(a).

Section 2.4 The Company Circular(1) The Company shall promptly prepare and complete, in consultation with Parent, the

Company Circular together with any other documents required by Law in connection with the Company Shareholder Meeting and the Arrangement, and the Company shall, promptly after obtaining the Interim Order as is practicable and, in any event, within 45 (forty-five) days following the date of this Agreement, cause the Company Circular and such other documents to be filed under Securities Laws and sent to each the Company Shareholder and other Person as required by the Interim Order and Law, in each case so as to permit the Company Shareholder Meeting to be held by the date specified in Section 2.3(1). The Company shall prepare the Company Circular in the French language if required by Law.

(2) The Company shall ensure that the Company Circular complies with Law, does not contain any Misrepresentation (other than with respect to any information provided in writing by Parent or its legal counsel for inclusion in the Company Circular) and provides the Company Shareholders with sufficient information to permit them to form a reasoned judgement concerning the matters to be placed before the Company Shareholder Meeting. Without limiting the generality of the foregoing, the Company Circular must include: (i) a statement that the Company Board, after receiving legal and financial advice, determined that the Arrangement Resolution is in the best interests of the Company and recommends that the Company Shareholders vote in favour of the Arrangement Resolution (the “Company Board Recommendation”),and (ii) a statement that each director and senior officer of the Company has agreed to vote all of such individual’s Company Shares in favour of the Arrangement Resolution, subject to other terms of this Agreement and the Voting Support Agreements.

(3) Parent shall furnish to the Company all such information regarding it and its affiliates as may be required by Law or which is reasonably requested by the Company in the preparation of the Company Circular. Parent shall ensure that such information shall not include a Misrepresentation.

(4) The Company shall give Parent and its legal counsel a reasonable opportunity to review and comment on drafts of the Company Circular and other related documents, and shall give due consideration to any comments made by Parent and its counsel, and agrees that all information relating solely to Parent included in the Company Circular must be in a form and content satisfactory to Parent, acting reasonably after giving due consideration to any comments made by the Company.

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(5) Parent shall indemnify and save harmless the Company and its directors and officers from and against any and all liabilities, claims, demands, losses, costs, damages and expenses to which the Company, or any of its directors or officers, may be subject or may suffer that result primarily from any Misrepresentation or alleged Misrepresentation in any information with respect to Parent or Acquireco included in the Company Circular (in the form acceptable to Parent) and that is provided by or on behalf of Parent or Acquireco for the purpose of inclusion in the CompanyCircular pursuant to Section 2.4(3).

(6) Each Party shall promptly notify the other Party if it becomes aware that the Company Circular contains a Misrepresentation, or otherwise requires an amendment or supplement. The Parties shall co-operate in the preparation of any such amendment or supplement as required or appropriate, and the Company shall promptly mail, file or otherwise publicly disseminate any such amendment or supplement to the Company Shareholders and, if required by the Court or by Law, file the same with the Securities Authorities or any other Governmental Entity as required.

Section 2.5 Final Order(1) The Company shall take all steps necessary or desirable to submit the Arrangement

to the Court and diligently pursue an application for the Final Order pursuant to section 192 of the CBCA, as soon as reasonably practicable, but in any event not later than three (3) Business Days after the later of (i) the date on which the Company Shareholder Approval is obtained in accordance with the Interim Order, and (ii) and the date on which the last of the Regulatory Approvals is obtained .

Section 2.6 Court Proceedings(1) In connection with all Court proceedings relating to obtaining the Interim Order and

the Final Order the Company shall:

(a) diligently pursue, and cooperate with Parent and Acquireco in diligently pursuing, the Interim Order and the Final Order;

(b) provide legal counsel to Parent with a reasonable opportunity to review and comment upon drafts of all material to be filed with the Court in connection with the Arrangement, and give reasonable consideration to all such comments (recognizing that whether or not the comments are appropriate shall be determined by the Company, acting reasonably);

(c) provide copies of any notice of appearance, evidence or other documentsserved on the Company or its legal counsel in respect of the application for the Interim Order or the Final Order or any appeal from them, and any notice, written or oral, indicating the intention of any Person to appeal, or oppose the granting of, the Interim Order or the Final Order;

(d) ensure that all material filed with the Court in connection with the Arrangement is consistent with this Agreement and the Plan of Arrangement;

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(e) not file any material with the Court in connection with the Arrangement or serve any such material, or agree to modify or amend any material so filed or served, except as contemplated by this Agreement or with Parent’s prior written consent, such consent not to be unreasonably withheld, conditioned or delayed, provided Parent is not required to agree or consent to any increase in or variation in the quantum or form of the Consideration or other modification or amendment to such filed or served materials that expands or increases Parent’s obligations, or diminishes or limits Parent’s rights, set forth in any such filed or served materials or under this Agreement;

(f) subject to Article 5, oppose any proposal from any Person that the Final Order contain any provision inconsistent with this Agreement, and if required by the terms of the Final Order or by Law to return to Court with respect to the Final Order do so only after notice to, and in consultation and cooperation with, Parent; and

(g) not object to legal counsel to Parent making such submissions on the hearing of the motion for the Interim Order and the application for the Final Order as such counsel considers appropriate; provided that the Company is advised of the nature of any submissions prior to the hearing and such submissions are consistent with this Agreement and Plan of Arrangement.

Section 2.7 Articles of Arrangement and Effective Date(1) The Company shall file the Articles of Arrangement with the Director no later than

the third Business Day after the satisfaction or, where not prohibited, the waiver by the applicable Party or Parties in whose favour the condition is, of the conditions set out in Article 6 (excluding conditions that, by their terms, cannot be satisfied until the Effective Date, but subject to the satisfaction or, where not prohibited, the waiver by the applicable Party or Parties in whose favour the condition is, of those conditions as of the Effective Date), unless another time or date is agreed to in writing by the Parties.

(2) The closing of the Arrangement will take place at the offices of Miller Thomson in Toronto, Ontario, or at such other location as may be agreed upon by the Parties.

Section 2.8 Payment of Consideration (1) Acquireco shall, in accordance with the Plan of Arrangement, deposit with the

Depositary in immediately available funds:

(a) the aggregate consideration for all the Company Common Shares to be acquired by Acquireco pursuant to the Plan of Arrangement; and

(b) the aggregate consideration for all of the Company Warrants to be acquired by Acquireco pursuant to the Plan of Arrangement.

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(2) Acquireco shall, in accordance with the Plan of Arrangement, advance to the Company an amount of cash equal to the amount required to settle and cancel the Company Options to be settled and cancelled pursuant to the Plan of Arrangement.

(3) Acquireco shall have sufficient cash on the Effective Date to satisfy in full the debt claim of each holder of Company Common Shares who has validly exercised his, her or its Dissent Rights in accordance with the Plan of Arrangement.

(4) Acquireco shall, prior to the Effective Time, deposit with the Depositary in immediately available funds, the following amount (i) $4.5 million if the Effective Date is expected to occur on or before November 9, 2012, or (ii) $4.8 million if the Effective Date is expected to occur after November 9, 2012 but before December 1, 2012, or (iii) $5 million if the Effective Date is expected to occur in the month of December 2012, to fund the payment by the Company of its financial obligations payable at the Effective Time relating to this Agreement and the Plan Arrangement.

Section 2.9 Announcement and Shareholder Communications(1) Parent and the Company shall each publicly announce the transactions

contemplated hereby promptly following the execution of this Agreement, the text and timing of each Party’s announcement to be approved by the other Party in advance, acting reasonably. Parent and the Company agree to cooperate in the preparation of presentations, if any, to the Company Shareholders regarding the transactions contemplated by this Agreement and no Party shall:

(a) issue any press release or otherwise make public announcements with respect to this Agreement or the Plan of Arrangement without the consent of the other Party (which consent shall not be unreasonably withheld or delayed); or

(b) make any filing with any Governmental Entity with respect thereto without prior consultation with the other Party;

provided, however, that the foregoing shall be subject to each Party’s overriding obligation to make any disclosure or filing under Law or Exchange rules, and the Party making such disclosure shall use all commercially reasonable efforts to give prior written notice to the other Party and reasonable opportunity to review or comment on the disclosure or filing, and if such prior notice is not possible, to give such notice immediately following the making of such disclosure or filing.

(2) Subject to the overriding obligations of the Company to make any disclosure or filing under Law or Exchange rules, the Company shall where practicable, provide prior notice to Parent of any material public disclosure that it proposes to make regarding its business or operations, together with a draft copy of such disclosure and to give to Parent and its legal counsel an opportunity to review and comment on such information prior to such information being disseminated publicly or filed with any Governmental Entity, provided that the final version of the public disclosure shall be determined by the Company in its sole discretion.

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Section 2.10 Performance of Acquireco(a) Parent unconditionally and irrevocably guarantees, and agrees to be jointly

and severally liable with Acquireco for, the due and punctual performance of each and every covenant and obligation of Acquireco arising under this Agreement or under or relating to the Plan of Arrangement including the payment for any Company Shares, Company Options, Company Warrants and Company Shares subject to Dissent Rights, under the Arrangement and the payment to the Depositary to fund certain payments to the Company in accordance with section 2.8(4) of this Agreement (collectively, the “Obligations”), upon the terms and subject to the conditions of this Agreement and the Plan of Arrangement. Parent shall cause Acquireco to comply with all of the Obligations.

(b) If any Obligation is not duly performed by Acquireco and is not performed under this Section 2.10 by Parent for any reason whatsoever, Parent will, as a separate and distinct obligation, indemnify and save harmless the Company from and against all losses resulting from the failure of Acquireco to perform such Obligation. If any such Obligation is not duly performed by Acquireco and is not performed by Parent under this Section 2.10, or the Company is not indemnified under the immediately preceding sentence, in each case, for any reason whatsoever, such Obligation will, as a separate and distinct obligation, be performed by Parent as primary obligor.

(c) The liability of Parent under this Section 2.10 will be for the full amount of the Obligations without apportionment, limitation or restriction of any kind, will be continuing, absolute and unconditional and will not be affected by any applicable Law, or any other act, delay, abstention or omission to act of any kind by Acquireco or any other person, that might constitute a legal or equitable defence to or a discharge, limitation or reduction of Parent’s obligations hereunder.

(d) The liability of Parent under this Section 2.10 will not be released, discharged, limited or in any way affected by anything done, suffered, permitted or omitted to be done by the Company in connection with any duties, obligations or liabilities of Acquireco to the Company, except those relating to obligations arising under this Agreement.

(e) The Company will not be bound or obligated to exhaust its recourse against Acquireco or other persons or take any other action before being entitled to demand payment from Parent under this Section 2.10.

Section 2.11 List of ShareholdersAt the request of Parent from time to time, provide Parent with a list (in both written

and electronic form) of (i) the registered Company Shareholders, together with their addresses and respective holdings of Company Shares, (ii) the names, addresses and holdings of all Persons having rights issued by the Company to acquire the CompanyShares (including holders of the Company Options and the Company Warrants), and (iii)

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participants and book-based nominee registrants such as CDS & Co., CEDE & Co. and DTC, and non-objecting beneficial owners of the Company Shares, together with their addresses and respective holdings of the Company Shares. The Company shall from time to time require that its registrar and transfer agent furnish Parent with such additional information, including updated or additional lists of the Company Shareholders, and lists of securities positions and other assistance as Parent may reasonably request.

ARTICLE 3REPRESENTATIONS AND WARRANTIES

Section 3.1 Representations and Warranties of the Company(1) Except as set forth in the correspondingly numbered paragraph of the Company

Disclosure Letter or in another section of the Company Disclosure Letter provided that it is apparent on its face that such disclosure qualifies a particular paragraph of Schedule C, the Company represents and warrants to Parent and Acquireco as set forth in Schedule C and acknowledges and agrees that Parent and Acquireco are relying upon such representations and warranties in connection with the entering into of this Agreement.

(2) The representations and warranties of the Company contained in this Agreement shall not survive the completion of the Arrangement and shall expire and be terminated on the earlier of the Effective Time and the date on which this Agreement is terminated in accordance with its terms.

Section 3.2 Representations and Warranties of Parent and Acquireco(1) Parent and Acquireco hereby jointly and severally represent and warrant to the

Company the following, and acknowledge and agree that the Company is relying upon the representations and warranties in connection with the entering into of this Agreement:

(a) Organization. Each of Parent and Acquireco has been duly incorporated or formed under all applicable Laws of its jurisdiction of incorporation or formation, is validly existing and has all necessary corporate or legal power, authority, and capacity to carry out this Agreement and the Arrangement. All of the issued and outstanding securities or other ownership interests of Acquireco are validly issued, fully paid and non-assessable. Acquireco will, at the Effective Time, be a wholly-owned Subsidiary of Parent formed solely for the purpose of engaging in the transactions contemplated by this Agreement and has engaged in no other business activities.

(b) Authority and No Violation. Each of Parent and Acquireco has the necessary corporate power, authority and capacity to enter into this Agreement and to perform its obligations hereunder. The execution and delivery of this Agreement by each of Parent and Acquireco and the performance of each of them of its obligations hereunder (including consummation by each of them of the Arrangement) has been duly authorized by each of their boards of

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directors, as applicable, and no other corporate proceedings on either corporation’s part are necessary to authorize the execution and delivery by it of this Agreement or the consummation by it of the arrangement.

(c) Enforceability. This Agreement has been duly executed and delivered by each of Parent and Acquireco and constitutes a legal, valid and binding obligation of each of Parent and Acquireco, enforceable against each in accordance with its terms.

(d) No Breach. The authorization of this Agreement, the execution and delivery by each of Parent and Acquireco of this Agreement and the performance by it of its obligations under this Agreement, and the consummation of the Arrangement shall not result (with or without notice or the passage of time) in a violation or breach of, or constitute a default under, require any consent to be obtained under, any provision of: (i) its certificate of incorporation, articles, by-laws or other charter documents; or (ii) any applicable Laws except where such violation, breach, default or failure to obtain a consent would not, individually or in the aggregate, materially impede the completion of the transactions contemplated by this Agreement.

(e) Consents and Approvals. No consent, approval, order or authorization of, or declaration or filing with, any Governmental Authority is required to be obtained by Parent or Acquireco in connection with the execution and delivery of this Agreement and the consummation by each of them of its respective obligations under this Agreement, including the consummation of the Arrangement, other than those set forth in Schedule D attached heretowhich are required prior to the consummation of the Arrangement.

(f) Litigation. There is no claim, action, suit, proceeding, investigation or arbitration pending or, to the knowledge of Parent, threatened against Parent or Acquireco, which, if adversely determined, would materially impair the ability of Parent or Acquireco to consummate the Arrangement or impede or materially delay the completion of the Arrangement nor, to the knowledge of Parent, are there any events or circumstances which would reasonably be expected to give rise to any such claim, action, suit, proceeding, investigation or arbitration. Neither Parent nor Acquireco is subject to any outstanding order, writ, injunction or decree which would materially impair the ability of Parent or Acquireco to consummate the Arrangement or impede or materially delay the completion of the Arrangement.

(g) Financing. Parent has delivered to the Company a complete and accurate copy of an executed financing letter (the “Financing Letter”) dated August 23, 2012 from Bank of Communications (the “Lender”). Pursuant to the Financing Letter and subject to the terms and conditions contained therein, the Lender has agreed to consider providing $270 million in aggregate principal amount of debt financing to Parent or an affiliate of Parent on or before the Effective Date (the “Financing”). As of the date of this Agreement, the Financing Letter is in full force and effect, is a legal, valid and binding

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obligation of the parties thereto, and the Financing Letter has not been amended in any material respect, and any financing and other fees that are due and payable on or before the date hereof under the Financing Letter have been paid in full. The Parent and/or Acquireco have sufficient funds, cash equivalents and credit available to provide that Acquireco will, at the Effective Time, have sufficient funds to pay the amount in immediately available funds required to be deposited with the Depositary, the amount of cash to be advanced to the Company in respect of the Company Optionholders and the amount to be paid to the Company Shareholders who properly exercise Dissent Rights all in accordance with the Plan of Arrangement and Section 2.8 of this Agreement and Acquireco will, at or immediately prior to the Effective Date, have sufficient funds to effect the closing of the Arrangement.

(h) Escrow. Parent HK Subsidiary has concurrently with the execution of this Agreement deposited with the escrow agent under the Escrow Agreement the amount of $7,000,000 to secure the performance of Parent’s obligations under this Agreement, all in accordance with the terms and conditions set out in the Escrow Agreement.

(i) Regulatory Approvals. After consultation with Parent’s legal, financial and other professional or government relations advisors in The People’s Republic of China, Parent and Acquireco have no reason to believe that the Regulatory Approvals will not be obtained on or before the Outside Date. The Parent has delivered to the Company true and complete copies of all applications and notifications (excluding any part thereof constituting confidential information) submitted to any Governmental Authority prior to the date of this Agreement in connection with any Regulatory Approvals set out in Schedule D.

(j) Security Ownership. Neither Parent nor Acquireco nor any of their respective affiliates, is the beneficial owner of any the Company Shares, the Company Options or the Company Warrants.

(2) The representations and warranties of Parent contained in this Agreement shall not survive the completion of the Arrangement and shall expire and be terminated on the earlier of the Effective Time and the date on which this Agreement is terminatedin accordance with its terms.

ARTICLE 4COVENANTS

Section 4.1 Covenants of the Company Regarding the Conduct of Business.(1) The Company covenants and agrees that, during the period from the date of this

Agreement until the earlier of the Effective Date and the time that this Agreement is terminated in accordance with its terms, unless Parent shall otherwise consent in writing, such consent not to be unreasonably withheld or delayed, or as is otherwise

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expressly permitted or specifically contemplated by this Agreement or the Arrangement or set forth in the Disclosure Letter, the Company shall conduct business only in the Ordinary Course and shall conduct the activities of DachangProject only in the Ordinary Course, with any activities outside of the Ordinary Course requiring the prior written consent of Parent, such consent not to be unreasonably withheld or delayed, provided that Parent acknowledges that the Company has not conducted any exploration activities at the Dachang Project since December 2011 and the Company will not do so prior to the Effective Time.

(2) Without limiting the generality of Section 4.1(1), the Company shall use commercially reasonable efforts to preserve intact the current business organization of the Company, keep available the services of the present employees and agents of the Company and maintain satisfactory relations with, and the goodwill of, suppliers, customers, landlords, creditors, distributors, Governmental Entities and all other Persons having business relationships with the Company, and the Company shall not, and shall not permit any of its affiliates to, directly or indirectly:

(a) amend its Constating Documents or, in the case of any affiliate which is not a corporation, its similar organizational documents;

(b) amend, modify or supplement the Joint Venture Agreement;

(c) split, combine or reclassify any shares of the Company or declare, set aside or pay any dividend or other distribution (whether in cash, stock or property or any combination thereof);

(d) redeem, repurchase, or otherwise acquire or offer to redeem, repurchase or otherwise acquire any shares of capital stock of the Company or any of its affiliates;

(e) other than as set forth in the Company Disclosure Letter, issue, deliver or sell, or authorize the issuance, delivery or sale of any shares of capital stock, any options, warrants or similar rights exercisable or exchangeable for or convertible into such capital stock of the Company or any of its affiliates, except for the issuance of the Company Shares issuable upon the exercise of the currently outstanding the Company Options and the Company Warrants;

(f) acquire (by merger, consolidation, acquisition of stock or assets or otherwise), directly or indirectly, in one transaction or in a series of related transactions, assets, securities, properties, interests or businesses;

(g) sell, lease, transfer or otherwise dispose of any of the assets of the Companyor its affiliates except for assets which are obsolete and which individually or in the aggregate do not exceed $200,000;

(h) make any payment for any liability or obligation or otherwise, other than, (i) in the Ordinary Course, (ii) in accordance with the “Company Budget” as set forth in the Company Disclosure Letter, (iii) expenses or payments related to

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the Arrangement, including all professional fees, (iv) payment of amounts in respect of any employee termination payments related to termination of employees as set out in the Company Disclosure Letter, and (v) any payments that may be required on or following the Effective Date under existing employment agreements between the Company and certain officers of the Company due to a change of control as set out in the Company Disclosure Letter, all such amounts in (v) of this paragraph or such amounts in respect of severance payable to such other employees to be terminated at the Effective Time to be paid to the employee or deposited for the benefit of such employee prior to the Effective Date with a trustee or depositary to be selected by the Company. In the event that the Company has extraordinary obligations not otherwise permitted in this Section 4.1(2)(h), the Company must seek the approval of the Parent to allow it to pay such obligations, which approval will not be unnecessarily withheld or delayed.

(i) prepay any indebtedness before its scheduled maturity or increase, create, incur, assume or otherwise become liable for any indebtedness for borrowed money or guarantees thereof;

(j) make any loan or advance to, or any capital contribution or investment in, or assume, guarantee or otherwise become liable with respect to the liabilities or obligations of, any Person except for expense advances to the Company’s employees or consultants;

(k) enter into any interest rate, currency, equity or commodity swaps, hedges, derivatives, forward sales contracts or similar financial instruments;

(l) make any bonus or profit sharing distribution or similar payment of any kind;

(m) make any change in the Company’s methods of accounting except as required under Canadian GAAP or IFRS or applicable Laws;

(n) grant any general increase in the rate of wages, salaries, bonuses or other remuneration to any of the employees of the Company;

(o) (i) increase any severance, change of control or termination pay to (or amend any existing arrangement with) any employee of the Company, director or executive officer or any of its affiliates; (ii) increase the benefits payable under any existing severance or termination pay policies with any employee of the Company, director or executive officer of the Company or any of its affiliates; (iii) increase the benefits payable under any employment agreements with any employee of the Company, director or executive officer of the Company or any of its affiliates; (iv) enter into any employment, deferred compensation or other similar agreement (or amend any such existing agreement) with any director or executive officer of the Company; or (v) increase compensation, bonus levels or other benefits payable to any director or executive officer of the Company or to any employee of the

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Company (other than, in the case of each director, a $25,000 retirement bonus to be paid to each director of the Company on or before the Effective Date), in the case of an employee of the Company who is not a director or executive officer of the Company, in a manner consistent with past practice;

(p) cancel, waive, release, assign, settle or compromise any material claims or rights;

(q) compromise or settle any litigation, proceeding or governmental investigation;

(r) amend or modify or terminate or waive any right under any Material Contract or enter into any contract or agreement that would be a Material Contract if in effect on the date hereof;

(s) except as contemplated in Section 4.6, amend, modify or terminate any material insurance policy of the Company or any affiliate in effect on the date of this Agreement;

(t) authorize, agree, resolve or otherwise commit, whether or not in writing, to do any of the foregoing;

(u) abandon or fail to diligently pursue any application for any material licences, permits, authorizations or registrations;

(v) make, change or revoke any material Tax election or settle or compromise any material Tax liability;

(w) knowingly take any action or enter into any transaction, other than a transaction contemplated by this Agreement, without the consent of Parent, or a transaction undertaken in the Ordinary Course, that could reasonably be expected to have the effect of materially reducing or eliminating the amountof the tax cost “bump” pursuant to paragraphs 88(1)(c) and (d) of the Tax Act otherwise available to Acquireco and its successors in respect of the non-depreciable capital properties owned by the Company and its subsidiaries as of the date of this Agreement or acquired by such entities subsequent to the date of this Agreement in accordance with the terms of this Agreement, without first consulting with Parent and the Company; and the Companywill use its best reasonable efforts to address the reasonable concerns of Parent in regards to such provisions prior to taking or allowing a subsidiary to take such action or effect such transaction.

Section 4.2 Covenants of the Company Regarding the Arrangement.(1) the Company shall use its reasonably commercial efforts to take or cause to be taken

all actions and to do or cause to be done all things necessary, proper or advisable under Law to consummate the Arrangement as soon as practicable, including:

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(a) using its reasonably commercial efforts to obtain and maintain all third party or other consents, waivers, permits, exemptions, orders, approvals, agreements, amendments or confirmations that are required (A) in connection with the Arrangement or (B) in order to maintain the Material Contracts in full force and effect following completion of the Arrangement, in each case, without committing itself or Parent to pay, any consideration or incur any liability or obligation without the prior written consent of Parent (not to be unreasonably withheld or delayed);

(b) using its reasonable commercial efforts to, on prior written approval of Parent (not to be unreasonably withheld), oppose, lift or rescind any injunction, restraining or other order, decree or ruling seeking to restrain, enjoin or otherwise prohibit or adversely affect the consummation of the Arrangement and defend, or cause to be defended, any proceedings to which it is a party or brought against it or its directors or officers challenging the Arrangement or this Agreement;

(c) carrying out the terms of the Interim Order and the Final Order applicable to it and complying promptly with all requirements imposed by Law on it or its Subsidiaries with respect to this Agreement or the Arrangement;

(d) not taking any action, or refraining from taking any commercially reasonable action, or permitting any action to be taken or not taken, which is inconsistent with this Agreement or which would reasonably be expected toprevent, delay or otherwise impede the consummation of the Arrangement;

(e) promptly advise Parent in writing of any material breach by the Company of any covenant, obligation or agreement contained in this Agreement; and

(f) use reasonable commercial efforts to satisfy, or cause to be satisfied, all conditions precedent in this Agreement that are in its power to satisfy.

(2) Except as prohibited by applicable Law or any Material Contract, the Company shall promptly notify Parent of:

(a) any Material Adverse Effect or any change, effect, event, development, occurrence, circumstance or state of facts which could be expected to have a Material Adverse Effect, provided that the foregoing shall be subject to the Company’s overriding obligation to make any disclosure or filing required under applicable Securities Laws;

(b) any notice or other communication from any Person (other than a Government Entity) alleging that the consent (or waiver, permit, exemption, order, approval, agreement, amendment or confirmation) of such Person is required in connection with this Agreement or the Arrangement;

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(c) any notice or other communication from any Governmental Entity in connection with the Agreement (and contemporaneously provide a copy of any such written notice or communication to Parent); or

(d) any filing, actions, suits, claims, investigations or proceedings commenced or, to its knowledge, threatened against, relating to or involving or otherwise affecting the Company, this Agreement or the Arrangement.

(3) The Parties shall cooperate with one another in connection with obtaining the Regulatory Approvals including providing one another with copies of all notices and information or other correspondence supplied to, filed with or received from any Governmental Entity.

Section 4.3 Covenants of Parent Relating to the ArrangementParent shall, and Parent shall cause its Subsidiaries to, perform all obligations required or desirable to be performed by Parent or any of Parent’s Subsidiaries under this Agreement, co-operate with the Company in connection therewith, and do all such other acts and things as may be necessary or desirable in order to consummate and make effective, as soon as reasonably practicable, the transactions contemplated in this Agreement and, without limiting the generality of the foregoing, Parent shall and where appropriate shall cause its Subsidiaries to:

(1) apply for and use its best efforts to obtain all Regulatory Approvals relating to Parent or any of Parent’s affiliates which are required in order to consummate the Arrangement and, in doing so, keep the Company regularly informed in writing (not less than weekly) as to the status of the proceedings related to obtaining such Regulatory Approvals, including providing the Company with copies of all related applications and notifications excluding any part thereof constituting confidential information, in draft form, in order for the Company to provide its reasonable comments thereon;

(2) use all its reasonable commercial efforts to assist the Company in obtaining all third party or other consents, waivers, permits, exemptions, orders, approvals, agreements, amendments or confirmations that are required (A) in connection with the Arrangement or (B) required in order to maintain the Material Contracts in full force and effect following completion of the Arrangement, provided Parent shall not be obligated to pay any fees or guarantee any obligations in connection with the Company obtaining such consents, waivers, permits, exemptions, orders, approvals, agreements, amendments or confirmations that are required;

(3) defend all lawsuits or other legal, regulatory or other proceedings against Parent challenging or affecting this Agreement or the Arrangement.

(4) carrying out the terms of the Interim Order and the Final Order applicable to it and complying promptly with all requirements imposed by Law on it or its Subsidiaries with respect to this Agreement or the Arrangement;

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(5) not take any action, or refrain from taking any commercially reasonable action, or permit any action to be taken or not taken, which is inconsistent with this Agreement or which would reasonably be expected to prevent, delay or otherwise impede the consummation of the Arrangement;

(6) promptly advise the Company in writing of any material breach by Parent or Acquireco of any covenant, obligation or agreement contained in this Agreement; and

(7) use its reasonable commercial efforts to satisfy, or cause to be satisfied, all conditions precedent in this Agreement that are in its power to satisfy.

Section 4.4 Access to Information(1) Subject to any third party confidentiality obligations, the Company shall provide to

Parent and Acquireco and their respective Representatives (a) upon reasonable notice, reasonable access during normal business hours to its and its affiliates (i) premises, (ii) property (including the Dachang Project) and assets (including all books and records, whether retained internally or otherwise) and (iii) senior personnel, so long as the access does not unduly interfere with the Ordinary Course conduct of business; and (b) such financial and operating data or other information with respect to its assets or business (including the Dachang Project) as is requested.

(2) Investigations made by or on behalf of Parent or Acquireco, whether under this Section 4.4 or otherwise, will not waive, diminish the scope of, or otherwise affect any representation or warranty made by the Company in this Agreement.

Section 4.5 Notice and Cure Provisions(1) Each Party shall promptly notify the other Party of the occurrence, or failure to

occur, of any event or state of facts which occurrence or failure would, or would be likely to:

(a) cause any of the representations or warranties of such Party contained in this Agreement to be untrue or inaccurate in any material respect at any time from the date of this Agreement to the Effective Time; or

(b) result in the failure to comply with or satisfy any covenant, condition or agreement to be complied with or satisfied by such Party under this Agreement;

(2) Neither Parent nor Acquireco may exercise its right to terminate this Agreement pursuant to Section 7.2(1)(d)(i), and the Company may not exercise its right to terminate this Agreement pursuant to Section 7.2(1)(c)(i), unless the Party seeking to terminate the Agreement shall have delivered a written notice to the other Parties specifying in reasonable detail all breaches of covenants, representations and warranties or other matters which the Party delivering such notice is asserting as the basis for non-fulfillment or the applicable condition or the exercise of the termination right, as the case may be. If any such notice is delivered, provided that a Party is

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proceeding diligently to cure such matter and such matter is capable of being cured, no Party may terminate this Agreement, until the earlier of (i) the Outside Date, and (ii) the date that is 15 (fifteen) Business Days following receipt of such notice by the Party to whom the notice was delivered, if such matter has not been cured by such date. If such notice has been delivered prior to the date of the Company Shareholder Meeting, such meeting shall, unless the Parties agree otherwise, be postponed or adjourned until the expiry of such period (without causing any breach of any other provision contained herein). If such notice has been delivered prior to the filing of the Articles of Arrangement with the Director, such filing shall be postponed until two Business Days after the expiry of such period.

(3) Each Party shall promptly notify the other Parties of (i) any communication from any person alleging that the consent of such person (or another person) is or may be required in connection with the transactions contemplated by this Agreement (and the response thereto from such Party, its Subsidiaries or its representatives), (ii) any material communication from any Governmental Entity in connection with the transactions contemplated by this Agreement (and the response thereto from such Party, its Subsidiaries or its representatives), and (iii) any material claims, actions, suits or proceedings threatened or commenced against or otherwise affecting such Party or any of its Subsidiaries that are related to the transactions contemplated by this Agreement.

(4) Notification provided under this Section 4.5 will not affect the representations, warranties, covenants, agreements or obligations of the Parties (or remedies with respect thereto) or the conditions to the obligations of the Parties under this Agreement.

Section 4.6 Insurance and Indemnification (a) From and after the Effective Time, Parent shall fulfill and honour, and shall

cause the Company and/or its successors to fulfill and honour, in all respects, its obligations pursuant to any indemnification agreements between the Company and the present or former directors or officers of the Company or any of its Subsidiaries (each, an “Indemnified Person”) in effect immediately prior to the Effective Time and any indemnification provisions under the Constating Documents of the Company or the applicable Laws, in each case, as in effect on the date hereof and to the extent disclosed in the Company’s Disclosure Letter and permitted by applicable Laws and/or its successors to not amend, repeal or otherwise modify the provisions with respect to exculpation and indemnification contained in the Constating Documents of the Company as in effect on the date hereof for a period of six years from the Effective Time in any manner that would adversely affect the rights thereunder of individuals who, prior to the Effective Time, were directors or officers of the Company.

(b) Prior to the Effective Time, the Company and its Subsidiaries shall and, if the Company and its Subsidiaries are unable to, Parent shall cause the Company and its Subsidiaries as of the Effective Time, to obtain and fully pay the

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premium for the extension of the directors’ and officers’ liability coverage of the existing primary and excess directors’ and officers’ insurance policies for the Company and its Subsidiaries for a period of at least six years from and after the Effective Time (“D&O Insurance”) with terms, conditions, retentions and limits of liability that are no less advantageous than the coverage provided under the existing policies of the Company and its Subsidiaries with respect to any actual or alleged error, misstatement, misleading statement, act, omission, neglect, breach of duty or any matter claimed against a director or officer of the Company or any of its Subsidiaries by reason of him or her serving in such capacity that existed or occurred at or prior to the Effective Time (including in connection with this Agreement or the transactions or actions contemplated hereby) provided that the aggregate cost of such D&O Insurance shall not exceed 200% of the aggregate premium paid by the Company for its current primary and excess directors’ and officers’ insurance policies. If the Company and its Subsidiaries for any reason fail to obtain such “tail” insurance policies as of the Effective Time, the Company and its Subsidiaries shall continue to maintain in effect for a period of at least six years from and after the Effective Time the D&O Insurance in place as of the date hereof with terms, conditions, retentions and limits of liability that are no less advantageous than the coverage provided under the Company’s existing policies as of the date hereof, or the Company shall purchase comparable D&O Insurance for such six-year period with terms, conditions, retentions and limits of liability that are at least as favourable as provided in the Company’s existing policies as of the date hereof.

(c) If the Company or any of its successors or assigns shall (i) amalgamate, consolidate with or merge or wind up into any other person and shall not be the continuing or surviving corporation or entity, or (ii) transfer all or substantially all of its properties and assets to any person, then, and in each such case, proper provisions shall be made so that the successors and assigns of the Company shall assume all of the obligations set forth in this Section 4.6. Parent and Acquireco will ensure that the Company and any successors or assigns have adequate financial resources to satisfy all of the obligations set forth in this Section 4.6.

(d) The provisions of this Section 4.6 shall survive the consummation of thetransactions contemplated by this Agreement and are intended for the benefit of, and shall be enforceable by, each insured or indemnified person, his or her heirs or legal representatives and, for such purpose, the Company hereby confirms that it is acting as agent and trustee on their behalf.

ARTICLE 5ADDITIONAL COVENANTS REGARDING NON-SOLICITATION

Section 5.1 Non-Solicitation(1) Except as expressly provided in this Article 5, the Company shall not, directly or

indirectly, through any officer, director, employee, representative (including any

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financial or other adviser) or agent of the Company or of any of its affiliates (collectively “Representatives”), and shall not permit any such Person to:

(a) solicit, assist, initiate, encourage or otherwise facilitate (including by way of furnishing or providing copies of, access to, or disclosure of, any confidential information, properties, facilities, books or records of the Company or any affiliate or entering into any form of agreement, arrangement or understanding, other than a confidentiality agreement as contemplated by Section 5.1(4)) any inquiry, proposal or offer that constitutes or may reasonably be expected to constitute or lead to, an Acquisition Proposal;

(b) enter into or otherwise engage or participate in any discussions or negotiations with any Person (other than Parent and its affiliates) regarding any inquiry, proposal or offer that constitutes or could be expected to constitute or lead to, an Acquisition Proposal, provided that the Company may: (A) advise any persons requesting access to non-public information relating to the Company that such access cannot be provided unless such person makes an Acquisition Proposal; and (B) advise any person making an unsolicited Acquisition Proposal that such Acquisition Proposal does not constitute or could not reasonably be expected to lead to a Superior Proposal if the Company Board has so determined;

(c) make a Change in Recommendation;

(d) accept, approve, endorse or recommend, or publicly propose to accept, approve, endorse or recommend, or publicly take no position or remain neutral with respect to, any Acquisition Proposal (it being understood and agreed that publicly taking no position or a neutral position with respect toan Acquisition Proposal for a period of no more than 7 Business Days following the announcement of such Acquisition Proposal will not constitute a violation of this Section 5.1); or

(e) accept or enter into or publicly propose to enter into any agreement, arrangement or understanding in respect of an Acquisition Proposal (other than a confidentiality agreement as contemplated by Section 5.1(4));

(2) The Company shall, and shall cause its affiliates and its Representatives to, immediately cease and terminate, and cause to be terminated, any solicitation, encouragement, discussion or negotiations commenced prior to the date of this Agreement with any Person (other than Parent) with respect to any inquiry, proposal or offer that constitutes, or could reasonably be expected to constitute or lead to, an Acquisition Proposal, and whether or not initiated by the Company or its Representatives, and in connection with such termination shall:

(a) discontinue access to, and disclosure of all information, (including any data room access and any confidential information) regarding the Company or any affiliate; and

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(b) request, and exercise all rights it has to require (i) the return or destruction of all copies of any confidential information regarding the Company or any affiliate provided to any Person (other than Parent) to the extent that such information has not previously been returned or destroyed, and (ii) the destruction of all material including or incorporating or otherwise reflecting such confidential information regarding the Company or any affiliate using its reasonable commercial efforts to ensure that such requests are fully complied with in accordance with the terms of such rights or entitlements.

(3) The Company represents and warrants that the Company has not waived any confidentiality, standstill or similar agreement or restriction to which the Companyor any affiliate is a Party, except to permit submissions of expressions of interest prior to the date of this Agreement, and further covenants and agrees (i) that the Company shall take all necessary action to enforce each confidentiality, standstill or similar agreement or restriction to which the Company or any affiliate is a party, and (ii) that neither the Company nor any affiliate nor any of their respective Representatives has or will, without the prior written consent of Parent (which may be withheld or delayed in Parent’s sole and absolute discretion), release any Person from, or waive, amend, suspend or otherwise modify such Person’s obligations respecting the Company or any of its affiliates under any confidentiality, standstill or similar agreement or restriction to which the Company or any affiliate is a party, it being acknowledged by Parent and Acquireco that the automatic termination or release of any standstill restrictions of any such agreements as a result of entering into and announcing this Agreement shall not be a violation of this Section 5.1(3) but provided that any agreement containing such a standstill restriction was not amended by the Company subsequent to its date of first execution in order to provide for automatic termination or release of a standstill restriction.

(4) Notwithstanding any other provision of this Agreement, if at any time following the date of this Agreement and prior to obtaining the Company Shareholder Approval at the Company Shareholder Meeting, the Company receives a bona fide written Acquisition Proposal that the Company Board determines in good faith, after consultation with its outside legal counsel and financial advisors, is or could reasonably be expected to result in, if consummated in accordance with its terms, a Superior Proposal, then the Company may, provided it is in compliance with Section 5.1 and Section 5.2:

(a) furnish information with respect to the Company and its affiliates to the Person making such Acquisition Proposal; and/or

(b) enter into, participate, and maintain discussions or negotiations with, and otherwise cooperate with or assist, the Person making such Acquisition Proposal,

provided that the Company shall not, and shall not allow the CompanyRepresentatives to, disclose any non-public information with respect to the Company to such Person: (i) if such non-public information has not been previously provided to, or is not concurrently provided to, Parent; and (ii) without entering into

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an agreement that contains confidentiality, standstill and other provisions that are in the aggregate no less favourable to the Company in any material respect to the termsapplicable to the Company in the Confidentiality Agreement. In particular but without limitation, such agreement may not include any provision calling for anexclusive right to negotiate with the Company and may not restrict the Company or its affiliates or Representatives from complying with this Article 5.

Section 5.2 Notification of Acquisition Proposals(1) If the Company or any of its affiliates or any of their respective Representatives,

receives or otherwise becomes aware of any inquiry, proposal or offer that constitutes or could constitute or reasonably be expected to lead to an Acquisition Proposal, or any request for copies of, access to, or disclosure of, confidential information relating to the Company or any affiliate, including but not limited to information, access, or disclosure relating to the properties, facilities, books or records of the Company or any affiliate, the Company shall promptly notify Parent, at first orally, and then promptly and in any event within 24 hours in writing, of such Acquisition Proposal. Such notice shall include a copy of any written Acquisition Proposal (and any amendment thereto) which has been received or, if no written Acquisition Proposal has been received, a description of its material terms and conditions, the identity of all Person(s) making the Acquisition Proposal, inquiry, offer or request, and copies of all documents, correspondence or other material received in respect of, from or on behalf of any such Person.

(2) The Company shall keep Parent promptly and fully informed of material details of the status of discussions and negotiations, including any change or amendment to the terms and conditions of each Acquisition Proposal, inquiry, offer, or request.

Section 5.3 Right to Match(1) Notwithstanding any other provision of this Agreement, if the Company receives an

Acquisition Proposal that constitutes a Superior Proposal prior to the approval of the Arrangement Resolution by the Company Shareholders, nothing shall prevent the Company Board, subject to compliance with Article 7 and Section 8.2, from making a Change in Recommendation or entering into a definitive agreement with respect to such Acquisition Proposal that is a Superior Proposal (it being acknowledged and agreed that this Section 5.3 shall not apply to the execution of a confidentiality agreement permitted by Section 5.1(4)), if and only if:

(a) the Person making the Superior Proposal was not restricted from making such Superior Proposal pursuant to an existing standstill or similar restriction;

(b) the Company has been, and continues to be, in compliance with its obligations under this Article 5;

(c) the Company has delivered to Parent a written notice of the determination of the Company Board that such Acquisition Proposal constitutes a Superior Proposal and of the intention of the Company Board to enter into such

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definitive agreement, together with a written notice from the Company Board regarding the value and financial terms that the Company Board, in consultation with its financial advisors, has determined should be ascribed to any non-cash consideration offered under such Acquisition Proposal (the “Superior Proposal Notice”);

(d) the Company has provided Parent a copy of the proposed definitive agreement for the Superior Proposal;

(e) at least five (5) Business Days (the “Matching Period”) have elapsed following the date that is the later of the date on which Parent received the Superior Proposal Notice and a copy of the proposed definitive agreement for the Superior Proposal from the Company;

(f) during each Matching Period, Parent has had the opportunity (but not the obligation), in accordance with Section 5.3(2), to offer to amend this Agreement and the Arrangement in order for such Acquisition Proposal to cease to be a Superior Proposal;

(g) after the Matching Period, the Company Board has determined in good faith, after consultation with the Company’s outside legal counsel and financial advisers, that such Acquisition Proposal continues to constitute a Superior Proposal compared to the terms of the Arrangement as proposed to be amended by Parent under Section 5.3(2);

(h) such Superior Proposal does not provide for the payment of any break, termination or other fees or expenses to any person in the event that the Company completes the transactions contemplated by this Agreement or any other similar transaction with Parent agreed to prior to the termination of this Agreement (for greater certainty, this Section 5.1(3) does not apply in connection with any agreement entered into by the Company concurrently with or following the termination of this Agreement pursuant to Section 7.2(1)(c)(ii)); and

(i) prior to or concurrently with entering into such definitive agreement the Company terminates this Agreement pursuant to Section 7.2(1)(c)(ii) and pays the Termination Fee pursuant to Section 8.2.

(2) During each Matching Period: (a) the Company Board shall review any written offer made by Parent under Section 5.3(1)(f) to amend the terms of this Agreement and the Arrangement in good faith in order to determine whether such amended proposal would, upon acceptance, result in the Acquisition Proposal previously constituting a Superior Proposal ceasing to be a Superior Proposal; and (b) the Company shall negotiate in good faith with Parent to make such amendments to the terms of this Agreement and the Arrangement as would enable Parent to proceed with thetransactions contemplated by this Agreement on such amended terms. If the Company Board determines that such Acquisition Proposal would cease to be a Superior Proposal, the Company shall promptly so advise Parent, and the Company,

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Parent and Acquireco shall amend this Agreement to reflect such written offer made by Parent, and shall take and cause to be taken all such actions as are necessary to give effect to the foregoing.

(3) Each successive amendment to any Acquisition Proposal to be received by the Company Shareholders shall constitute a new Acquisition Proposal for the purposes of this Section 5.3, and Parent shall be afforded a new five (5) Business Day Matching Period from the later of the date on which Parent received the Superior Proposal Notice and a copy of the definitive agreement for the new Superior Proposal from the Company.

(4) The Company Board shall promptly reaffirm the Company Board Recommendation by press release after any Acquisition Proposal which is not determined to be a Superior Proposal is publicly announced or the Company Board determines that a proposed amendment to the terms of this Agreement as contemplated under Section 5.3(2) would result in an Acquisition Proposal no longer being a Superior Proposal. The Company shall provide Parent and its outside legal counsel with a reasonable opportunity to review the form and content of any such press release.

(5) If the Company provides a Superior Proposal Notice to Parent after a date that is less than ten (10) Business Days before the Company Shareholder Meeting, the Company shall, as directed by Parent, either proceed with or shall postpone the CompanyShareholder Meeting, to a date that is not more than five (5) Business Days after the scheduled date of the Company Shareholder Meeting.

(6) Nothing contained in this Agreement shall prohibit the Company Board from making any disclosure to the Company Shareholders, responding through a directors’ circular or otherwise as required by applicable Securities Laws to any Acquisition Proposal or from calling and holding a meeting of the CompanyShareholders requisitioned by the Company Shareholders in accordance with the CBCA or ordered to be held by a court pursuant to the CBCA, in each case prior to the Effective Date if required under applicable Laws.

Section 5.4 Breach by Affiliates and Representatives(1) Without limiting the generality of the foregoing, the Company shall advise its

affiliates and the Representatives of the prohibitions set out in this Article 5 and any violation of the restrictions set forth in this Article 5 by the Company, its affiliates or Representatives is deemed to be a breach of this Article 5 by the Company.

ARTICLE 6CONDITIONS

Section 6.1 Mutual Conditions PrecedentThe Parties are not required to complete the Arrangement unless each of the

following conditions is satisfied on or prior to the Effective Time, which conditions may only be waived, in whole or in part, by the mutual consent of each of the Parties:

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(1) No Termination. The Agreement shall not have been terminated pursuant to Article 7.

(2) Company Shareholder Approval. The Company Shareholder Approval shall have been obtained at the Company Shareholder Meeting in accordance with the Interim Order.

(3) Interim and Final Order. The Interim Order and the Final Order have each been obtained on terms consistent with this Agreement, and have not been set aside or modified in a manner unacceptable to either the Company or Parent, acting reasonably, on appeal or otherwise.

(4) Illegality. No Law is in effect that makes the consummation of the Arrangement illegal or otherwise prohibits or enjoins the Company or Parent from consummating the Arrangement.

(5) Regulatory Approvals. All Regulatory Approval shall have been obtained on terms satisfactory to the Parties and each Regulatory Approval is in force and has not been modified (except where modified to the satisfaction of each of the Parties).

Section 6.2 Additional Conditions Precedent to the Obligations of ParentParent and Acquireco are not required to complete the Arrangement unless each of

the following conditions is satisfied on or before the Effective Time, which conditions are for the exclusive benefit of Parent and Acquireco and may only be waived, in whole or in part, by them in their sole discretion:

(1) Representations and Warranties. All representations and warranties of the Company under this Agreement shall be true and correct (without regard to any materiality or Material Adverse Effect qualifications contained in them) as of the Effective Date, as though made on and as of the Effective Date (other than the representations and warranties made as of a specified date, the accuracy of which shall be determined as of that specified date), except where the failure or failures of all such representations and warranties to be so true and correct would not reasonably be expected to have a Material Adverse Effect; and Parent shall have received a certificate of the Company addressed to Parent and dated the Effective Date, signed on behalf of the Company by two (2) senior officers thereof (on the Company’s behalf and without personal liability), confirming the same as at the Effective Date;

(2) Performance of Covenants. The Company has fulfilled or complied in all material respects with each of the covenants of the Company contained in this Agreement to be fulfilled or complied with by it on or prior to the Effective Time, and has delivered a certificate confirming same to Parent and Acquireco, executed by two (2) senior officers of the Company (in each case without personal liability) addressed to Parent and Acquireco and dated the Effective Date.

(3) No Legal Action. There is no action or proceeding pending or threatened by any Person in any jurisdiction to:

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(a) cease trade, enjoin, prohibit, or impose any limitations, damages or conditions on Parent’s and Acquireco’s ability to acquire, hold, or exercise full rights of ownership over, the Company Shares, including the right to vote the Company Shares;

(b) prohibit or restrict the Arrangement, or the ownership or operation by Parent or Acquireco of the business or assets of the Company or its affiliates, or compel Parent or Acquireco to dispose of or hold separate any material portion of the business or assets of Parent, Acquireco, the Company or any of its affiliates as a result of the Arrangement; or

(c) prevent or materially delay the consummation of the Arrangement, or if the Arrangement is consummated, have a Material Adverse Effect.

(4) Dissent Rights. Dissent Rights have not been exercised with respect to more than 5% of the issued and outstanding the Company Shares.

(5) SRP Rights. The SRP Rights have been redeemed or terminated, and none of the SRP Rights shall have been exercised or become exercisable and no Company Shares shall have been issued from the exercise of SRP Rights.

(6) Material Adverse Effect. No Material Adverse Effect shall have occurred that has not been publicly disclosed by the Company prior to the date hereof, and since the date hereof there shall not have occurred a Material Adverse Effect.

(7) Voting Agreements. There shall not have been any breach of any of the Voting Agreements by any party to any such agreement other than Parent or Acquireco that materially adversely affects the completion of the Arrangement.

(8) Resignations. The Company shall have received resignations effective immediately following the Effective Time from each of its directors and executive officers.

Section 6.3 Additional Conditions Precedent to the Obligations of the CompanyThe Company is not required to complete the Arrangement unless each of the

following conditions is satisfied on or before the Effective Time, which conditions are for the exclusive benefit of the Company and may only be waived, in whole or in part, by the Company in its sole discretion:

(1) Representations and Warranties. All representations and warranties of Parent and Acquireco under this Agreement shall be true and correct (without regard to any materiality qualifications contained in them) as of the Effective Date, as though made on and as of the Effective Date (other than the representations and warranties made as of a specified date, the accuracy of which shall be determined as of that specifieddate), except where the failure or failures of all such representations and warranties to be so true and correct in all respects would not reasonably be expected to materially impair or delay the consummation of the Arrangement; and the Companyshall have received a certificate of Parent and Acquireco addressed to the Company

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and dated the Effective Date, signed on behalf of Parent and Acquireco by a senior executive officer of each of them (on behalf of Parent and Acquireco, respectively, and without personal liability), confirming the same as at the Effective Date; and

(2) Performance of Covenants. Parent and Acquireco have fulfilled or complied in all material respects with their covenants contained in this Agreement to be fulfilled or complied with them on or prior to the Effective Time, and each has delivered a certificate confirming same to the Company, executed by two (2) senior officers of Parent and Acquireco (in each case without personal liability) addressed to the Company and dated the Effective Date.

(3) Deposit of Consideration. Parent shall have provided or caused to be provided to the Depositary, the Company and Acquireco, sufficient funds in cash to complete the transactions contemplated by the Arrangement and this Agreement.

Section 6.4 Satisfaction of ConditionsThe conditions precedent set out in Section 6.1, Section 6.2 and Section 6.3 will be

conclusively deemed to have been satisfied, waived or released when the Certificate of Arrangement is issued by the Director.

ARTICLE 7TERM AND TERMINATION

Section 7.1 TermThis Agreement shall be effective from the date hereof until the earlier of the

Effective Date and the termination of this Agreement in accordance with its terms.

Section 7.2 Termination(1) This Agreement may be terminated prior to the Effective Time by:

(a) the mutual written agreement of the Parties; or

(b) either the Company or Parent if:

(i) the Company Shareholder Approval is not obtained at the Company Shareholder Meeting (or any adjournment or postponement thereof) in accordance with the Interim Order, provided that a Party may not terminate this Agreement pursuant to this Section 7.2(1)(b)(i) if the failure to obtain the Company Shareholder Approval has beenprincipally caused by, or is a result of, a breach by such Party of any of its representations or warranties or the failure of such Party to perform any of its covenants or agreements under this Agreement;

(ii) after the date of this Agreement, any Law is enacted, made, enforced or amended, as applicable, that makes the consummation of the Arrangement illegal or otherwise permanently prohibits or enjoins

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the Company or Parent from consummating the Arrangement, and such Law has, if applicable, become final and non-appealable;

(iii) the Regulatory Approvals have not been obtained by the Outside Date, provided that a Party may not terminate this Agreement pursuant to this Section 7.2(1)(b)(iii) if the failure to obtain the Regulatory Approvals has been principally caused by, or is principally a result of, a breach by such Party of any of its representations or warranties or the failure of such Party to perform any of its covenants or agreements under this Agreement; or

(iv) the Effective Time does not occur on or prior to the Outside Date,provided that a Party may not terminate this Agreement pursuant to this Section 7.2(1)(b)(iv) if the failure of the Effective Time to so occur has been principally caused by, or is a result of, a breach by such Party of any of its representations or warranties or the failure of such Party to perform any of its covenants or agreements under this Agreement;

(c) the Company if:

(i) a breach of any representation or warranty or failure to perform any covenant or agreement on the part of Parent or Acquireco under this Agreement occurs that would cause any condition in Section 6.3(1) or Section 6.3(2) not to be satisfied, and such breach or failure is incapable of being cured (it being agreed that a failure by Parent or Acquireco to meet their obligations under Section 2.8 shall be deemed to be an incurable breach); provided that any intentional breach shall be deemed to be incurable and the Company is not then in breach of this Agreement so as to cause any condition in Section 6.2(1) or Section 6.2(2) not to be satisfied;

(ii) prior to the approval by the Company Shareholders of the Arrangement Resolution, the Company Board authorizes the Company to enter into a written agreement with respect to a Superior Proposal (other than a confidentiality and standstill agreement), provided the Company is then in compliance with Section 5.3 and that prior to or concurrent with such termination the Company pays the Termination Fee in accordance with Section 8.2; or

(iii) Parent does not provide or cause to be provided to the Depositary, the Company and Acquireco, sufficient funds in cash to complete the transactions contemplated by the Arrangement and this Agreement.

(d) Parent if:

(i) a breach of any representation or warranty or failure to perform any covenant or agreement on the part of the Company under this

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Agreement occurs that would cause any condition in Section 6.2(1) or Section 6.2(2) not to be satisfied, and such breach or failure is incapable of being cured; provided that any intentional breach shall be deemed to be incurable and Parent and Acquireco is not then in breach of this Agreement so as to cause any condition in Section 6.3(1)or Section 6.3(2) not to be satisfied;

(ii) the Company Board or any committee of the Company Board shall have made a Change in Recommendation, or the Company breaches Section 5.1(1) in any material respect, or the Company Board or any committee of the Company Board resolves to take any of the foregoing actions; or

(iii) there has occurred a Material Adverse Effect.

Section 7.3 Effect of Termination/Survival If this Agreement is terminated pursuant to Section 7.1 or Section 7.2, this Agreement shall become void and of no further force or effect without liability of any Party (or any shareholder, director, officer, employee, agent, consultant or representative of such Party) to any other Party to this Agreement, except that in the event of termination under Section 7.2, Section 2.4(5), Section 2.10(b), this Section 7.3and Section 8.2 through to and including Section 8.16 (in each case, together with all related definitions herein), and the Confidentiality Agreement (other than the standstill contained in Section 14 of the Confidentiality Agreement which shall terminate), shall survive. Notwithstanding the foregoing, but subject to the next following sentence: (i) subject to Section 8.4(1), in the case of a Termination Fee Event, all liabilities and damages of the Company hereunder, including relating to indemnification obligations of the Company contained herein, shall be limited to the Termination Fee and shall only be incurred in the circumstances set forth in Section 8.2(2); (ii) if the Termination Fee is not payable by the Company, then all such liabilities and damages of the Company hereunder, including relating to indemnification obligations of the Company contained herein, shall be limited to an amount not to exceed $50,000,000; (iii) subject to Section 8.4(2), if the Break-Up Fee is payable by Parent or Acquireco, then all liabilities and damages of Parent and Acquireco hereunder, including relating to indemnification obligations of Parent and Acquireco contained herein, shall be limited to the Break-Up Fee and shall only be incurred in the circumstances set forth in Section 8.3; and (iv) if the Break-Up Fee is not payable by Parent or Acquireco, then all such liabilities and damages of Parent and Acquireco, including relating to indemnification obligations of Parent and Acquireco contained herein, shall be limited to an amount not to exceed $50,000,000. No Party shall be relieved of any liability for any wilful breach by it of this Agreement

(1) As used in this Section 7.3, “wilful breach” means a breach that is a consequence of an act undertaken by the breaching party with the actual knowledge that the taking of such act would, or would be reasonably expected to, cause a breach of this Agreement.

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ARTICLE 8GENERAL PROVISIONS

Section 8.1 AmendmentsThis Agreement and the Plan of Arrangement may, at any time and from time to

time before or after the holding of the Company Shareholder Meeting but not later than the Effective Time, be amended by mutual written agreement of the Parties, without further notice to or authorization on the part of the Company Securityholders, provided that such amendment does not: (i) invalidate any required approval of the Arrangement by the Company Shareholders; or (ii) after the holding of the Company Shareholder Meeting, result in an adverse change in the quantum of consideration payable to the Company Shareholders pursuant to the Arrangement.

Section 8.2 Termination Fees(1) Despite any other provision in this Agreement relating to the payment of fees and

expenses, including the payment of brokerage fees, if a Termination Fee Event occurs, the Company shall pay Parent the Termination Fee in accordance withSection 8.2(3).

(2) For the purposes of this Agreement, “Termination Fee” means $7,000,000 and “Termination Fee Event” means the termination of this Agreement:

(a) by the Company pursuant to Section 7.2(1)(c)(ii) (Superior Proposal);

(b) by Parent pursuant to Section 7.2(1)(d)(ii) (Change in Recommendation/Breach Non-Solicit); or

(c) by either Party pursuant to Section 7.2(1)(b)(i) (No Company Shareholder Approval) and Parent is not in breach of its obligations under this Agreement at any time prior to or at the Company Shareholder Meeting, where an Acquisition Proposal in respect of the Company has been publicly made, publicly announced or otherwise publicly disclosed by any person prior to the Company Shareholder Meeting (and not publicly withdrawn), and within nine (9) months following the date of such Acquisition Proposal, such Acquisition Proposal in respect of the Company, or any other Acquisition Proposal in respect of the Company publicly made, publicly announced or otherwise publicly disclosed by any person during the pendency of such Acquisition Proposal, is consummated, provided that for purposes of this Section 8.2(2)(c) references to “20% or more” in the definition of “Acquisition Proposal” shall be deemed references to “50% or more”.

(3) The Termination Fee shall be paid by the Company to Parent, by wire transfer or immediately available funds, if a Termination Fee Event occurs in consideration for the disposition of Parent’s rights under this Agreement. Such payment shall be made, in the case of (a) above, prior to or simultaneously with the occurrence of such Termination Fee Event; in the case of (b) above, within two (2) Business days of the

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occurrence of such Termination Fee Event; and, in the case of (c) above, within three (3) Business Days of the consummation of the applicable Acquisition Proposal.

(4) The Company shall not be obligated to make more than one payment under Section 8.2 if more than one of the events specified in Section 8.2(2) occurs.

Section 8.3 Break-Up Fee(1) Parent shall cause Parent HK Subsidiary to instruct the escrow agent, in accordance with the terms of the Escrow Agreement to pay, or cause to be paid, to the Company the amount of $7,000,000 (the “Break-Up Fee”) as liquidated damages, by wire transfer of immediately available funds to an account designated by the Company, if this Agreement is terminated by the Company pursuant to Section 7.2(1)(c)(i) and Section 7.2(1)(c)(iii), which payment shall be made within two Business Days following such termination.

Section 8.4 Liquidated Damages and Injunctive Relief(1) Each Party acknowledges that the payment amount set out in Section 8.2(2) is

payment of liquidated damages which are a genuine pre-estimate of the damages which the Parent and Acquireco will suffer or incur as a result of the event giving rise to such damages and the resultant termination of this Agreement, and is not a penalty. The Company irrevocably waives any right it may have to raise as a defence that any such liquidated damages are excessive or punitive. For greater certainty, Parent and Acquireco agree that, upon any termination of this Agreement under circumstances where Parent is entitled to the Termination Fee and such Termination Fee is paid in full, Parent and Acquireco shall be precluded from any other remedy against the Company at Law or in equity or otherwise (including, without limitation, an order for specific performance), and shall not seek to obtain any recovery, judgment or damages of any kind, including consequential, indirect, or punitive damages, against the Company or any of the Company’s Subsidiaries or any of their respective directors, officers, employees, partners, managers, members, shareholders or affiliates or their respective representatives in connection with this Agreement or the transactions contemplated hereby. The receipt of payment made pursuant to Section 8.2(2) by Parent shall be deemed to be receipt of such payment by Parent and Acquireco, as applicable.

(2) Each Party acknowledges that the payment amount set out in Section 8.3 a payment of liquidated damages which are a genuine pre-estimate of the damages which the Company will suffer or incur as a result of the event giving rise to such damages and the resultant termination of this Agreement, and is not a penalty. Parent irrevocably waives any right it may have to raise as a defence that any such liquidated damages are excessive or punitive. For greater certainty, the Company agrees that, upon any termination of this Agreement under circumstances where the Company is entitled to the Break-Up Fee and it is paid in full, the Company shall be precluded from any other remedy against Parent and Acquireco at Law or in equity or otherwise (including, without limitation, an order for specific performance), and shall not seek to obtain any recovery, judgment or damages of any kind, including consequential, indirect, or punitive damages, against Parent or Acquireco or any of Parent’s or Acquireco’s Subsidiaries or any of their respective directors, officers, employees,

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partners, managers, members, shareholders or affiliates or their respective representatives in connection with this Agreement or the transactions contemplated hereby.

(3) The Parties agree that irreparable harm would occur in the event that any of the provisions of this Agreement were not performed in accordance with their specific terms or were otherwise breached for which money damages would not be an adequate remedy at Law. Accordingly, the Parties shall be entitled to an injunction or injunctions and other equitable relief to prevent breaches of this Agreement, any requirement for the securing or posting of any bond in connection with the obtaining of any such injunctive or other equitable relief hereby being waived by the other Parties. For greater certainty, nothing contained herein shall preclude a Party from seeking injunctive relief to restrain any breach or threatened breach of the covenants or agreements set forth in this Agreement or the Confidentiality Agreement or otherwise to obtain specific performance of any of such acts, covenants or agreements, without the necessity of posting a bond or security in connection therewith.

Section 8.5 Expenses(1) All out-of-pocket third party transaction expenses incurred in connection with this

Agreement and the Plan of Arrangement, including all costs, expenses and fees of the Company incurred prior to or after the Effective Date in connection with, or incidental to, the Plan of Arrangement, shall be paid by the Party incurring such expenses, whether or not the Arrangement is consummated.

Section 8.6 Notices.Any notice, or other communication given regarding the matters contemplated by

this Agreement (must be in writing, sent by personal delivery, courier or facsimile (or by electronic mail) and addressed to:

(a) Parent or Acquireco at:

Western Mining Group Co., Ltd.No. 52 Wusi AvenueXINING, QNG 810001China

Attention: Mr. Xihong PanFacsimile: 86.971.6122926

with a copy to:

Stikeman Elliott LLP5300 Commerce Court West199 Bay StreetToronto, ON M5L 1B9

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Attention: Quentin MarkinFacsimile: 416.947.4700

(b) to the Company at:

Inter-Citic Minerals Inc.60 Columbia Way, Suite 501Markham, ONL3R 0C9

Attention: Jim Moore,President & Chief Executive Officer

Facsimile: 905.479.6397

with a copy to:

Miller Thomson LLP40 King Street West, Scotia PlazaSuite 5800, P. O. Box 1011Toronto, ONM5H 3S1

Attention: Michael J. Pace Jay M. Hoffman

Facsimile: 416.595.8695E-mail: [email protected]

[email protected]

Any notice or other communication is deemed to be given and received (i) if sent by personal delivery or same day courier, on the date of delivery if it is a Business Day and the delivery was made prior to 5:00 p.m. (local time in place of receipt) and otherwise on the next Business Day, (ii) if sent by overnight courier, on the next Business Day, (iii) if sent by facsimile, on the Business Day following the date of confirmation of transmission by the originating facsimile, or (iv) if sent by electronic mail, on the date it is sent. A Party may change its address for service from time to time by providing a notice in accordance withthe foregoing. Any subsequent notice or other communication must be sent to the Party at its changed address. Any element of a Party’s address that is not specifically changed in a notice will be assumed not to be changed. Sending a copy of a notice or other communication to a Party’s legal counsel as contemplated above is for information purposes only and does not constitute delivery of the notice or other communication to that Party. The failure to send a copy of a notice or other communication to legal counsel does not invalidate delivery of that notice or other communication to a Party.

Section 8.7 Time of the Essence.Time is of the essence in this Agreement.

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Section 8.8 Third Party Beneficiaries.(1) Except as provided in Section 4.6 which, without limiting their terms, are intended

as stipulations for the benefit of the Persons mentioned in such provisions (such third Persons referred to in this Section 8.8 as the “Indemnified Persons”) and except for the rights of the Company Securityholders to receive the Consideration following the Effective Time pursuant to the Arrangement (for which purpose the Company hereby confirms that it is acting as agent on behalf of the Company Securityholders), the Company and Parent intend that this Agreement will not benefit or create any right or cause of action in favour of any Person, other than the Parties and that no Person, other than the Parties, shall be entitled to rely on the provisions of this Agreement in any action, suit, proceeding, hearing or other forum.

(2) Despite the foregoing, Parent acknowledges to each of the Indemnified Persons their direct rights against it under Section 4.6 of this Agreement, which are intended for the benefit of, and shall be enforceable by, each Indemnified Person, his or her heirs and his or her legal representatives, and for such purpose, the Company confirms that it is acting as trustee on their behalf, and agrees to enforce such provisions on their behalf. The Parties reserve their right to vary or rescind the rights at any time and in any way whatsoever, if any, granted by or under this Agreement to any Person who is not a Party, without notice to or consent of that Person, including any Indemnified Person.

Section 8.9 Waiver.No waiver of any of the provisions of this Agreement will constitute a waiver of any

other provision (whether or not similar). No waiver will be binding unless executed in writing by the Party to be bound by the waiver. A Party’s failure or delay in exercising any right under this Agreement will not operate as a waiver of that right. A single or partial exercise of any right will not preclude a Party from any other or further exercise of that right or the exercise of any other right.

Section 8.10 Entire Agreement.This Agreement, together with the Confidentiality Agreement, constitutes the entire

agreement between the Parties with respect to the transactions contemplated by this Agreement and supersedes all prior agreements, understandings, negotiations and discussions, whether oral or written, of the Parties. There are no representations, warranties, covenants, conditions or other agreements, express or implied, collateral, statutory or otherwise, between the Parties in connection with the subject matter of this Agreement, except as specifically set forth in this Agreement. The Parties have not relied and are not relying on any other information, discussion or understanding in entering into and completing the transactions contemplated by this Agreement.

Section 8.11 Successors and Assigns.(1) This Agreement becomes effective only when executed by the Company, Parent and

by Parent on behalf of Acquireco. After that time, it will be binding upon and enure to the benefit of the Company, Parent, Acquireco and their respective successors and permitted assigns.

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(2) Neither this Agreement nor any of the rights or obligations under this Agreement are assignable or transferable by any Party without the prior written consent of the other Parties.

Section 8.12 Severability.If any provision of this Agreement is determined to be illegal, invalid or

unenforceable by an arbitrator or any court of competent jurisdiction, that provision will be severed from this Agreement and the remaining provisions shall remain in full force and effect. Upon such determination that any term or other provision is invalid, illegal or incapable of being enforced, the Parties shall negotiate in good faith to modify this Agreement so as to effect the original intent of the Parties as closely as possible in an acceptable manner to the end that the transactions contemplated hereby are fulfilled to the fullest extent possible.

Section 8.13 Governing Law.This Agreement will be governed by and interpreted and enforced in accordance

with the laws of the Province of Ontario and the federal laws of Canada applicable therein.Each Party hereby irrevocably attorns to the nonexclusive jurisdiction of the Courts of the Province of Ontario in respect of all matters arising under and in relation to this Agreement and the Arrangement.

Section 8.14 Rules of Construction.The Parties to this Agreement waive the application of any Law or rule of

construction providing that ambiguities in any agreement or other document shall be construed against the party drafting such agreement or other document.

Section 8.15 No Liability.No director or officer of Parent or Acquireco shall have any personal liability

whatsoever to the Company under this Agreement or any other document delivered in connection with the transactions contemplated hereby on behalf of Parent or Acquireco. No director or officer of the Company or any of its affiliates shall have any personal liability whatsoever to Parent or Acquireco under this Agreement or any other document delivered in connection with the transactions contemplated hereby on behalf of the Company or any of its affiliates.

Section 8.16 Language.The Parties expressly acknowledge that they have requested that this Agreement

and all ancillary and related documents thereto be drafted in the English language only. Les parties aux présentes reconnaissent avoir exigé que la présente entente et tous les documents qui y sont accessoires soient rédigés en anglais seulement.

Section 8.17 Counterparts.This Agreement may be executed in any number of counterparts (including

counterparts by facsimile) and all such counterparts taken together shall be deemed to constitute one and the same instrument. The Parties shall be entitled to rely upon delivery of an executed facsimile or similar executed electronic copy of this Agreement, and such

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facsimile or similar executed electronic copy shall be legally effective to create a valid and binding agreement between the Parties.

[Remainder of page intentionally left blank. Signature pages follow.]

Signature Page to Arrangement Agreement

IN WITNESS WHEREOF the Parties have executed this Arrangement Agreement.

WESTERN MINING GROUP CO., LTD.

By:Authorized Signing Officer

WESTERN MINING GROUP CO., LTD.on behalf of a company to be incorporated by it


INTER-CITIC MINERALS INC.


SCHEDULES

Schedule A PLAN OF ARRANGEMENT

Schedule B ARRANGEMENT RESOLUTION

Schedule C REPRESENTATIONS AND WARRANTIES OF THE COMPANY

Schedule D REGULATORY APPROVALS

SCHEDULE A

PLAN OF ARRANGEMENT UNDER SECTION 192OF THE CANADA BUSINESS CORPORATIONS ACT

See Schedule C to this Circular for the full text of the Plan of Arrangement

SCHEDULE B

ARRANGEMENT RESOLUTION

See Schedule A to this Circular for the full text of the Arrangement Resolution

SCHEDULE C

REPRESENTATION AND WARRANTIES OF THE COMPANY

Except as set forth in the correspondingly numbered paragraph of the Company’s Disclosure Letter or in another section of the Company’s Disclosure Letter, provided that it is apparent on its face that such disclosure qualifies a particular paragraph of this Schedule C, the Company hereby represents and warrants to Parent and Acquireco as follows, and acknowledges and agrees that Parent and Acquireco are relying upon such representations and warranties in connection with the entering into of this Agreement:

(1) Organization and Qualification. the Company is duly continued and validly existing under the CBCA and has full corporate power and authority to own its assets and conduct its business as now owned and conducted. the Company is duly qualified to carry on business and is in good standing in each jurisdiction in which the character of its properties or the nature of its activities makes such qualification necessary, except where the failure to be so qualified will not, individually or in the aggregate, have a Material Adverse Effect. True and complete copies of the constating documents of the Company have been delivered or made available to Parent, and the Company has not taken any action to amend or supersede such documents.

(2) Authority Relative to this Agreement. The Company has the requisite corporate power and authority to enter into this Agreement and to perform its obligations hereunder. The execution and delivery of this Agreement by the Company and the consummation by the Company of the transactions contemplated by this Agreement have been duly authorized by the Company’s Board and no other corporate proceedings on the part of the Company are necessary to authorize this Agreement and complete the transactions contemplated thereby, other than the approval of the holders of the Company Shares and as provided in the Interim and Final Order. This Agreement has been duly executed and delivered by the Company and constitutes a valid and binding obligation of the Company, enforceable by Parent and Acquireco against the Company in accordance with its terms, except as the enforcement thereof may be limited by bankruptcy, insolvency and other applicable Laws affecting the enforcement of creditors’ rights generally and subject to the qualification that equitable remedies may be granted only in the discretion of a court of competent jurisdiction.

(3) No Conflict. The execution and delivery by the Company of this Agreement and the performance by it of its obligations hereunder and the completion of the Arrangement will not violate, conflict with or result in a breach of any provision of the constating documents of the Company or those of any of its affiliates, and except as would not, individually or in the aggregate, have or reasonably be expected to have a Material Adverse Effect and except for the Regulatory Approvals and shareholder vote and complying with applicable corporate and securities laws, will not: (a) violate, conflict with, or result in a breach of: (i) any agreement, contract, indenture, deed of trust, mortgage, bond, instrument, Authorization, licence or permit to which the Company or any of its affiliates is a party or by which the Company or any of its affiliates is bound, or the Joint Venture Agreement; or (ii) any

Law to which the Company or any of its affiliates is subject or by which the Company or any of its affiliates or the Dachang Project is bound; (b) give rise to any right of termination, or the acceleration of any indebtedness, under any such agreement, contract, indenture, Authorization, deed of trust, mortgage, bond, instrument, licence or permit; or (c) give rise to any rights of first refusal or rights of first offer, trigger any change in control or influence provisions or any restriction or limitation under any such agreement, contract, indenture, Authorization, deed of trust, mortgage, bond, instrument, licence or permit, or result in the imposition of any encumbrance, charge or lien upon any of the Company’s assets or the assets of any of its affiliates.

(4) Governmental Approvals. Other than the Interim Order, the Final Order, and the filing of the Certificate of Arrangement and Articles of Arrangement, no authorization, consent or approval of, or filing with, any Governmental Entity or any court or other authority is necessary on the part of the Company for the consummation by the Company of its obligations in connection with the Arrangement under this Agreement or for the completion of the Arrangement not to cause or result in any loss of any rights or assets or any interest therein held by the Company or any of its affiliates in any material properties (including the DachangProject), except for such Authorizations, consents, approvals and filings as to which the failure to obtain or make would not, individually or in the aggregate, prevent or materially delay consummation of the Arrangement and the Regulatory Approvals set forth on Schedule D, including the Dachang Project.

(5) Competition Act. As calculated in accordance with the Competition Act (Canada)and the regulations thereto, the Company has assets in Canada: (a) with a book value of less than C$77 million; and (b) that generate annual revenues of less than C$77 million.

(6) Investment Canada Act. As calculated in accordance with the Investment Canada Act and the regulations thereto, the book value of the assets of the Company is less than C$330 million and the enterprise value of the assets of the Company is less than C$600 million.

(7) Fairness Opinion. The Company Board has received the opinion of Standard Chartered, to the effect that, as of the date hereof, and subject to the assumptions, limitations and qualifications set forth therein, the consideration to be received by the Company Shareholders in connection with this Agreement and pursuant to the Arrangement is fair, from a financial point of view, to the Company Shareholders.

(8) Subsidiaries. The only subsidiaries of the Company are Inter-Citic Holdings Ltd. and Techmat Inc., which are duly organized and validly existing and in good standing under the laws of the Cayman Islands and the laws of the Republic of Mauritius, as applicable, and each is duly qualified to carry on business and is in good standing in each jurisdiction in which the character of its properties or the nature of its activities makes such qualification necessary. Each such Subsidiary is held directly or indirectly by the Company, free and clear of all Encumbrances whatsoever and the Company is entitled to the full beneficial ownership of all such securities in such

Subsidiaries. All of such shares in the capital of the Subsidiaries have been duly authorized and validly issued and are outstanding as fully paid shares and no Person, other than the Company, has any right, agreement or option, present or future, contingent or absolute, or any right capable of becoming a right, agreement or option, for the purchase from the Company of any interest in any of such shares or for the issue or allotment of any unissued shares in the capital of such Subsidiaries or any other security convertible into or exchangeable for any such shares. There are no other corporations or unincorporated entities, other than these Subsidiaries and the Joint Venture, in which the Company owns a direct or indirect voting or equity interest.

(9) Status of Joint Venture. The Joint Venture is duly organized and validly existing and in good standing under the laws of the PRC and is duly qualified to carry on business in each jurisdiction in which the character of its properties or the nature of its activities makes such qualification necessary. Pursuant to the Joint Venture Agreement, and subject to the terms and conditions thereof, the Company will have an 83% interest in the Dachang Project and will have an option to increase its interest to 90%. No person, other than the Company and No. 5 Institute, has any right, agreement or option, present or future, contingent or absolute, or any right capable of becoming a right, agreement or option, for any interest in the Joint Venture.

(10) Regulatory Filings. The Company Filings have complied in all material respects with all applicable requirements. None of the Company Filings, at the time filed, contained any untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary in order to make the statements made therein, in light of the circumstances under which they were made, not misleading. The Company has filed with all applicable Governmental Entities true and complete copies of the Company’s Public Documents that the Company is required to file therewith. The Company Public Documents at the time filed: (a) did not contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading, and (b) complied in all material respects with the requirements of applicable Securities Laws. The Company has not filed any confidential material change report with any Governmental Entity which at the date hereof remains confidential.

(11) Compliance with Laws.

(a) The activities of the Company and its affiliates have been and are nowconducted in compliance with all Laws of each jurisdiction in which they operate, and none of the Company nor any of its affiliates has received any notice of any alleged violation of any such Laws.

(b) None of the Company nor any of its affiliates is in conflict with, or in default (including cross defaults) under or in violation of: (a) its articles or by-laws or equivalent organizational documents; or (b) any agreement, contract or understanding to which it or by which any of the properties or assets in which it has a controlling interest or an option to acquire a controlling

interest is bound or affected, including agreements and understandings relating to the Dachang Project.

(12) Company Authorizations. The Company and its affiliates have obtained all Authorizations necessary for the ownership, operation, development, maintenance, or use of the assets of the Company and its affiliates or otherwise in connection with the business or operations and the Company or its affiliates, and such Authorizations are in full force and effect. The Company and its affiliates have fully complied with and are in compliance with all Authorizations, except, in each case, for such non-compliance which, individually or in the aggregate, would not have a Material Adverse Effect. There is no action, investigation or proceeding pending or, to the knowledge of the Company, threatened, regarding any of the Authorizations. None of the Company nor any of its affiliates has received any notice, whether written or oral, of revocation or non-renewal of any such Authorizations, or of any intention of any Person to revoke or refuse to renew any of such Authorizations, except in each case, for revocations or non-renewals which, individually or in the aggregate, would not have a Material Adverse Effect, and all such Authorizations continue to be effective in order for the Company and its affiliates to continue to conduct their respective businesses as they are currently being conducted.

(13) Capitalization and Listing.

(a) The authorized share capital of the Company consists of an unlimited number of the Company Shares. As at the date of this Agreement there are: (A) 117,573,645 Company Shares validly issued and outstanding as fully-paid and non-assessable shares of the Company; (B) outstanding CompanyOptions providing for the issuance of 8,712,826 Company Shares upon the exercise thereof; and (C) outstanding Company Warrants providing for the issuance of 5,968,420 Company Shares upon the exercise thereof. There are no options except stock option plan, warrants, conversion privileges, calls or other rights, agreements, arrangements, commitments, or obligations of the Company or any of its affiliates to issue or sell any shares of the Company or of any of its affiliates or securities or obligations of any kind convertible into, exchangeable for or otherwise carrying the right or obligation to acquire any shares of the Company or any of its affiliates, and there are no outstanding stock appreciation rights, phantom equity or similar rights, agreements, arrangements or commitments of the Company or any of its affiliates, and no Person is entitled to any pre-emptive or other similar right granted by the Company or any of its affiliates.

(b) The Company Disclosure Letter sets forth, as of the date hereof, full, complete and accurate details of all outstanding Options and the number, exercise prices and expiration dates of all such Company Options. All Company Shares that may be issued pursuant to the exercise of outstanding Company Options will, when issued in accordance with the terms of the Company Options, be duly authorized, validly issued, fully-paid and non-

assessable and are not and will not be subject to or issued in violation of, any pre-emptive rights.

(c) The Company Disclosure Letter sets forth, as of the date hereof, full, complete and accurate details of all outstanding Company Warrants and the number, exercise prices and expiration dates of all such Company Warrants. All Company Shares that may be issued pursuant to the exercise of outstanding Company Warrants will, when issued in accordance with the terms of the Company Warrants, be duly authorized, validly issued, fully-paid and non-assessable and are not and will not be subject to or issued in violation of, any pre-emptive rights.

(d) There are no outstanding contractual obligations of the Company or any of its affiliates to repurchase, redeem or otherwise acquire any Company Shares or any shares of any of its affiliates. No affiliate of the Company owns any Company Shares.

(e) No order ceasing or suspending trading in securities of the Company nor prohibiting the sale of such securities has been issued and is outstanding against the Company or its directors or officers.

(14) Rights Plan. The Rights Plan was approved by the Company Shareholders on May 19, 2008 and amended on May 20, 2010 and is in full force and effect, unamended. The Company Board has not waived the application of the Rights Plan.

(15) Zijin Rights. All rights granted by the Company to Zijin Mining Group Co., Ltd. pursuant to the subscription agreement dated April 12, 2010, including but not limited to participation rights and nomination rights, have expired in accordance with their terms.

(16) Shareholder and Similar Agreements. The Company is not party to, nor to the Company’s knowledge, any of its shareholders a party to, any shareholder, pooling, voting trust or other similar agreement relating to the issued and outstanding shares in the capital of the Company or any of its affiliates.

(17) Financial Statements.

(a) The audited consolidated financial statements for the Company as at and for each of the fiscal years ended on November 30, 2011, 2010 and 2009 including the notes thereto and the reports by the Company’s auditors thereon, and the interim consolidated financial statements for the Company for the three and six month periods ended May 31, 2012 including the notes thereto, have been, and all financial statements of the Company which are publicly disseminated by the Company in respect of any subsequent periods prior to the Effective Date will be, prepared in accordance with (i) in the case of the interim consolidated financial statements described above, International Financial Reporting Standards (“IFRS”) as adopted by the Canadian Institute of Chartered Accountants, or (ii) in the case of the audited consolidated

financial statements described above, Canadian GAAP before the adoption of IFRS, applied on a basis consistent with prior periods and all applicable Laws and present fairly, in all material respects, the assets, liabilities (whether accrued, absolute, contingent or otherwise), consolidated financial position and results of operations of the Company and its affiliates as of the respective dates thereof and its results of operations and cash flows for the respective periods covered thereby (except as may be indicated expressly in the notes thereto).

(b) There are no off-balance sheet transactions, arrangements, obligations (including contingent obligations) or other relationships of the Company with unconsolidated entities or other persons.

(c) PricewaterhouseCoopers LLP has been the auditors of the Company since 1999 and are independent public accountants as required under Securities Laws. The Company has never had any reportable disagreements with its present or any former auditor.

(d) Since November 30, 2009, neither the Company nor any of its affiliates nor, to the Company’s knowledge, any director, officer, employee, auditor, accountant or representative of the Company or any of its affiliates has received or otherwise had or obtained knowledge of, any complaint, allegation, assertion, or claim, whether written or oral, regarding the accounting or auditing practices, procedures, methodologies or methods of the Company or any of its affiliates or their respective internal accounting controls, including any complaint, allegation, assertion, or claim that the Company or any of its affiliates has engaged in questionable accounting or auditing practices, which has not been resolved to the satisfaction of the audit committee of the Company Board.

(18) Undisclosed Liabilities. Neither the Company nor any of its affiliates has any liabilities or obligations of any nature, whether or not accrued, contingent or otherwise, except for: (a) liabilities and obligations that are specifically presented on the audited consolidated balance sheets of the Company as of November 30, 2011 (the “Company Balance Sheet”) or disclosed in the notes thereto; or (b) liabilities and obligations incurred in the Ordinary Course of business consistent with past practice since November 30, 2011, that are not and would not, individually or in the aggregate with all other liabilities and obligations of the Company and its affiliates (other than those disclosed on the Company Balance Sheet and/or in the notes to the Company financial statements), reasonably be expected to have a Material Adverse Effect, or have a Material Adverse Effect. Without limiting the foregoing, the Company Balance Sheet reflects reasonable reserves in accordance with Canadian GAAP for contingent liabilities relating to pending litigation and other contingent obligations of the Company and its affiliates.

(19) Exploration Licenses.

(a) All of the Company’s and its affiliates real properties (collectively, and where material, the “Property”) and all of the Company’s and its affiliates mineral interests and rights (including any material claims, concessions, exploration licences, exploitation licences, prospecting permits, mining leases and mining rights, in each case, either existing under contract, by operation of Law or otherwise) (collectively, and where material, the “Mineral Rights”), are set out in the Company Disclosure Letter. Other than the Properties and the Mineral Rights set out in the Company Disclosure Letter, neither the Company nor its affiliates, owns or has any interest in any material real property or any material mineral interests and rights.

(b) The Property and Mineral Rights are the only interests and rights that constitute the Dachang Project.

(c) With the exception of any Permitted Liens, the Joint Venture is the legal and beneficial owner of all right, title and interest in and to the Property and the Mineral Rights, free and clear of any Encumbrances and the Joint Venture has obtained all necessary approvals relating to Property and the Mineral Rights. The procedures by which the Joint Venture acquired the Property and the Mineral Rights are in compliance with applicable Law.

(d) All of the Mineral Rights have been properly located and recorded in compliance with applicable Law and are comprised of valid and subsisting mineral claims.

(e) The Property and the Mineral Rights are in good standing under applicable Law and all work required to be performed and filed in respect thereof has been performed and filed, all Taxes, rentals, fees, expenditures and other payments in respect thereof have been fully paid and all filings in respect thereof have been made.

(f) With the exception of any Permitted Liens, there is no material adverse claim against or challenge to the title or ownership of the Property or any of the Mineral Rights and, to the knowledge of the Company, there are no events, circumstances or facts that could reasonably be expected to cause any material adverse claim or challenge to the title of ownership of the Property in the future.

(g) No Person other than the Company, its affiliates, and No. 5 Institute has any interest in the Property or any of the Mineral Rights or the production or profits therefrom or any royalty in respect thereof or any right to acquire any such interest.

(h) There are no back-in rights, earn-in rights, rights of first refusal or similar provisions or rights which would affect the Company’s or an affiliate’s interest in the Property, any of the Mineral Rights or the Dachang Project.

(i) There are no material restrictions on the ability of the Company and its affiliates to use, transfer or exploit the Property or any of the Mineral Rights, except pursuant to applicable Law and the Joint Venture Agreement.

(j) Neither the Company nor any of its affiliates has received any notice, whether written or oral, from any Governmental Entity of any revocation or intention to revoke any interest of the Company or any affiliate, or of the Joint Venture, in the Property, the Mineral Rights or the Dachang Project.

(k) The Company and its affiliates, or the Joint Venture, have all surface rights, and permits or licences and Authorizations permitting the use of land by the Company, its affiliates, and the Joint Venture, and the Mineral Rights as contemplated in the Company Public Documents filed (and available on SEDAR) on or before the date hereof, and no third party or group holds any such rights that would be required by the Company to develop the DachangProject or any of the Mineral Rights as contemplated in the Company Public Documents filed (and available on SEDAR) on or before the date hereof.

(20) Mineral Resources. The mineral resources for the Dachang Project, as set forth in the Company Public Documents, were prepared in accordance with sound mining, engineering, geoscience and other applicable industry standards and practices, and in all material respects in accordance with all applicable Laws, including the requirements of NI 43-101. There has been no material reduction in the aggregate amount of mineral resources for the Dachang Project from the amounts set forth in the Company Public Documents. All information regarding the Property, the Mineral Rights and the Dachang Project, including all drill results, technical reports and studies, that are required to be disclosed at Law, have been disclosed in the Company Public Documents on or before the date hereof.

(21) Technical Data. The Company has provided to Parent true and complete copies of all material technical information and data, in its or its affiliates’ possession, related to the Dachang Project, including (i) data on surveying, geological exploration, light and heavy mountain engineering, geochemical exploration and data on quality surveillance engineering, (ii) data on sampling processing and testing (including internal and external testing), and (iii) geological surveying data.

(22) Project Matters. Except as would not, individually or in the aggregate, be reasonably expected to result in a Material Adverse Effect:

(a) all rentals, royalties, overriding royalty interests, production payments, net profits, interest burdens, payments and obligations due and payable or performable, as the case may be, on or prior to the date hereof under, with respect to, or on account of, any direct or indirect assets of the Company, its affiliates or the Joint Venture, have been: (A) duly paid; (B) duly performed; or (C) provided for prior for the date hereof; and

(b) all costs, expenses, and liabilities payable on or prior to the date hereof under the terms of any contracts and agreements to which the Company, any of its

affiliates, or the Joint Venture, is directly or indirectly bound, have been properly and timely paid, except for such expenses that are being currently paid prior to delinquency in the Ordinary Course of business.

(23) Employment Matters.

(a) Other than as disclosed in the Company Disclosure Letter, neither the Company nor any of its affiliates has entered into any written or oral agreement or understanding providing for severance or termination payments to any director, officer or employee in connection with the termination of their position or their employment as a direct result of a change in control of the Company (including as a result of the Arrangement), and the Company has not changed or amended any such severance or termination obligations in the 12 month period prior to the date of this Agreement.

(b) Neither the Company nor any of its affiliates (i) is a party to any collective bargaining agreement, or (ii) is subject to any application for certification or, to the knowledge of the Company, threatened or apparent union-organizing campaigns for employees not covered under a collective bargaining agreement. To the knowledge of the Company, no fact or event exists that is likely to give rise to a change in this representation on or before the Effective Date.

(c) Neither the Company nor any of its affiliates is subject to any claim for wrongful dismissal, constructive dismissal or any other tort claim, actual or, to the knowledge of the Company, threatened, or any litigation actual, or to the knowledge of the Company, threatened, relating to employment or termination of employment of employees or independent contractors. No labour strike, lock-out, slowdown or work stoppage is pending or threatened against or directly affecting the Company or any of its affiliates.

(24) Absence of Certain Changes or Events. Since November 30, 2011:

(a) the Company and its affiliates have conducted their respective businesses only in the Ordinary Course of business and consistent with past practice;

(b) no liability or obligation of any nature (whether absolute, accrued, contingent or otherwise) which has had or is reasonably likely to have a Material Adverse Effect has been incurred;

(c) there has not been any event, circumstance or occurrence which has had or is reasonably likely to give rise to a Material Adverse Effect;

(d) there has not been any change in the accounting practices used by the Company and its affiliates, except as disclosed in the Company Public Documents (including the transition from Canadian GAAP to IFRS);

(e) except for Ordinary Course adjustments to non-executive employees, there has not been any increase in the salary, bonus, or other remuneration payable to any non-executive employees of any of the Company or its affiliates, including severance or termination payments resulting from a change of control;

(f) there has not been any redemption, repurchase or other acquisition of the Company Shares by the Company, or any declaration, setting aside or payment of any dividend or other distribution (whether in cash, shares or property) with respect to the Company Shares;

(g) there has not been any entering into, or an amendment of, any Material Contract other than in the Ordinary Course of business consistent with past practice;

(h) the Joint Venture Agreement has not been amended; and

(i) there has not been any satisfaction or settlement of any material claims or material liabilities that were not reflected in the Company’s audited financial statements.

(25) Litigation. There is no claim, action, proceeding or investigation pending or, to the knowledge of the Company, threatened against or relating to the Company or any of its affiliates, the business of the Company or any of its affiliates, the Joint Venture, or affecting any of their properties or assets (including the Dachang Project), before or by any Governmental Entity which, if adversely determined, would have, or reasonably could be expected to have, a Material Adverse Effect or prevent or materially delay the consummation of the Arrangement, nor to knowledge of the Company are there any events or circumstances which could reasonably be expected to give rise to any such claim, action, proceeding or investigation. Neither the Company nor any of its affiliates is subject to any outstanding order, writ, injunction or decree which has had or is reasonably likely to have a Material Adverse Effect or which would prevent or materially delay consummation of the transactions contemplated by this Agreement.

(26) Taxes.

(a) Each of the Company and its affiliates, and the Joint Venture, has duly and in a timely manner made or prepared all Tax Returns required to be made or prepared by it, and duly and in a timely manner filed all Tax Returns required to be filed by it with the appropriate Governmental Entity, such Tax Returns were complete and correct in all material respects and the Company and each of its affiliates, and the Joint Venture, has paid all Taxes, including instalments on account of Taxes for the current year required by applicable Law, which are due and payable by it whether or not assessed by the appropriate Governmental Entity. Since such publication date, no material liability in respect of Taxes not reflected in such statements or otherwise

provided for has been assessed, proposed to be assessed, incurred or accrued, other than in the Ordinary Course of business.

(b) Each of the Company and its affiliates, and the Joint Venture, has duly and timely withheld all Taxes and other amounts required by Law to be withheld by it (including Taxes and other amounts required to be withheld by it in respect of any amount paid or credited or deemed to be paid or credited by it to or for the benefit of any Person) and has duly and timely remitted to the appropriate Governmental Entity such Taxes or other amounts required by Law to be remitted by it.

(c) Each of the Company and its affiliates, and the Joint Venture, has duly and timely collected all amounts on account of any sales, use or transfer Taxes, including goods and services, harmonized sales, provincial and territorial taxes and state and local taxes, required by Law to be collected by it and has duly and timely remitted to the appropriate Governmental Entity such amounts required by Law to be remitted by it.

(d) None of the Company nor any of its affiliates, nor the Joint Venture, has made, prepared and/or filed any elections, designations or similar filings relating to Taxes or entered into any agreement or other arrangement in respect of Taxes or Tax Returns that has effect for any period ending after the Effective Date.

(e) There are no proceedings, investigations, audits or claims now pending or threatened against the Company or any of its affiliates, or the Joint Venture, in respect of any Taxes and there are no matters under discussion, audit or appeal with any Governmental Entity relating to Taxes.

(f) None of the Company nor any of its affiliates, nor the Joint Venture, has acquired property from a non-arm’s length Person, within the meaning of the Tax Act: (i) for consideration the value of which is less than the fair market value of the property; or (ii) as a contribution of capital for which no shares were issued by the acquirer of the property.

(g) There are no Encumbrances for Taxes upon any properties or assets of the Company or any of its affiliates or the Joint Venture.

(27) Books and Records. The corporate records and minute books of the Company and its affiliates have been maintained in accordance with all applicable Laws, and the minute books of the Company and its affiliates as provided to Parent are complete and accurate. The corporate minute books for the Company and its affiliates contain minutes of all meetings and resolutions of the directors and securityholders held except as disclosed in the Company Disclosure Letter. The financial books and records and accounts of the Company and its affiliates in all material respects: (a) have been maintained in accordance with good business practices and in accordance with (i) Canadian GAAP for periods prior to December 1, 2011, (ii) IFRS for periods subsequent to December 1, 2011, and (iii) with the accounting principles generally

accepted in the country of domicile of each such entity, on a basis consistent with prior years; (b) are stated in reasonable detail and fairly reflect the transactions and dispositions of assets of the Company and its affiliates; and (c) accurately and fairly reflect the basis for the Company’s consolidated financial statements.

(28) Insurance.

(a) The Company has in place reasonable and prudent insurance policies appropriate for its size, nature and stage of its exploration development. All premiums payable prior to the date hereof under such policies of insurance have been paid and neither the Company nor any of its affiliates has failed to make a claim thereunder on a timely basis.

(b) Each of such policies and other forms of insurance is in full force and effect on the date hereof and the Company will use reasonable commercial efforts to keep them in full force and effect or renew them as appropriate through the Effective Date. No written (or to the knowledge of the Company other) notice of cancellation or termination has been received by the Company or any of its Subsidiaries with respect to any such policy.

(29) Non-Arm’s Length Transactions. Except for employment or employment compensation agreements entered into in the Ordinary Course of business, there are no current contracts, commitments, agreements, arrangements or other transactions (including relating to indebtedness by the Company or any of its affiliates) between the Company or any of its affiliates on the one hand, and any (a) officer or director of the Company or any of its affiliates, (b) any holder of record or, to the knowledge of the Company, beneficial owner of ten percent or more of the voting securities of the Company, or (c) any affiliate or associate of any officer, director or beneficial owner, on the other hand.

(30) Foreign Corrupt Practices Laws. Neither the Company, its affiliates, the Joint Venture, nor, to the knowledge of the Company, any of their respective employees, directors, officers or agents is aware of, has taken, has committed to take, or is alleged to have taken, any action which would cause the Company, its affiliates, the Joint Venture or their respective affiliates to be in violation of the Corruption of Foreign Public Officials Act (Canada) and the rules and regulations promulgated thereunder, or any other applicable anti-corruption laws of similar effect of another jurisdiction (“Foreign Corrupt Practices Laws”), including making use of the mails or any means of instrumentality of interstate commerce corruptly in furtherance of an offer, payment, promise to pay or authorization of the payment of any money or other property, gift, promise to give, or authorization of the giving of anything of value (including any fee, sample, travel expense or entertainment) to:

(a) any person who is an official, officer, agent, employee or prospective customer (whether government-owned or controlled or non-government owned);

(b) any political party or official, officer, agent, employee or representative thereof;

(c) any candidate for political or political party office; or

(d) any other individual or entity while knowing of having reasons to believe that all or any portion of such money or thing of value would be offered, given, or promised, directly or indirectly, to any official, officer, agent, employee, or representative of any Governmental Entity, political party, candidate for political office, or existing or prospective customer, or any entity affiliated with an official, officer, agent, employee or representative of any Governmental Entity, political party, candidate for political office or existing or prospective customer, for the purpose of influencing an act or decision made in an official capacity, or inducing the use of influence in order to obtain or retain business or any business advantage or to direct business to any other person or third party.

The Company, its affiliates, and the Joint Venture have conducted their businesses in compliance with the Foreign Corrupt Practices Laws.

(31) Environmental. Except for any matters that, individually or in the aggregate, would not have or would not reasonably be expected to have a Material Adverse Effect:

(a) all facilities and operations of the Company, its affiliates, and the Joint Venture, have been conducted, and are now, in compliance with all Environmental Laws;

(b) there are no Environmental Permits that are required to own, lease and operate the Property, Mineral Rights and the Dachang Project and to conduct their respective business as they are now being conducted;

(c) no environmental, reclamation or closure obligation, demand, notice, work order or other liabilities presently exist with respect to any portion of any currently or formerly owned, leased, used or otherwise controlled property, interests and rights or relating to the operations and business of the Company and its affiliates and, to the knowledge of the Company, there is no basis for any such obligations, demands, notices, work orders or liabilities to arise in the future as a result of any activity in respect of such property, interests, rights, operations and business;

(d) neither the Company nor any of its affiliates is subject to any proceeding, application, order or directive which relates to environmental, health or safety matters, and which may require any material work, repairs, construction or expenditures;

(e) to the knowledge of the Company, there are no changes in or any renewal, modification, revocation, reassurance, alteration, transfer or amendment of any environmental approvals, consents, waivers, permits, orders and

exemptions, or any review by, or approval of, any Governmental Entity of such environmental approvals, consents, waivers, permits, orders and exemptions that are required in connection with the execution or delivery of this Agreement, the consummation of the transactions contemplated herein or the continuation of the business of the Company, its affiliates or the Joint Venture, following the Effective Date;

(f) the Company and its affiliates have made available to Parent all material audits, assessments, investigation reports, studies, plans, regulatory correspondence and similar information with respect to environmentalmatters; and

(g) to the knowledge of the Company, the Company, its affiliates and the Joint Venture, are not subject to any past or present fact, condition or circumstance that could reasonably be expected to result in liability under any Environmental Laws that would individually or in the aggregate, constitute a Material Adverse Effect.

(32) Material Contracts. The Company and its affiliates have performed in all material respects all respective obligations required to be performed by them to date under the Material Contracts. Neither the Company nor any of its affiliates is in breach or default under any Material Contract to which it is a party or bound, nor does the Company have knowledge of any condition that with the passage of time or the giving of notice or both would result in such a breach or default, except in each case where any such breaches or defaults would not, individually or in the aggregate, reasonably be expected to result in, or result in, a Material Adverse Effect. Neither the Company nor any of its affiliates knows of, or has received written notice of, any breach or default under (nor, to the knowledge of the Company, does there exist any condition which with the passage of time or the giving of notice or both would result in such a breach or default under) any such Material Contract by any other party thereto except where any such violation or default would not, individually or in the aggregate, reasonably be expected to result in, or result in, a Material Adverse Effect. Prior to the date hereof, the Company has made available to Parent true and complete copies of all of the Material Contracts of the Company and its affiliates. All Material Contracts are legal, valid, binding and in full force and effect and are enforceable by the Company (or its Subsidiary, as the case may be) in accordance with their respective terms (subject to bankruptcy, insolvency and other applicable Laws affecting creditors’ rights generally, and to general principles of equity) and are the product of fair and arms’ length negotiations between the parties thereto.

(33) Joint Venture Agreement. The Company has provided to Parent true and complete copies of the Joint Venture Agreement and the six subsequent amendments thereto. The Joint Venture Agreement, as amended, is in full force and effect and has not otherwise been amended, modified or terminated.

(34) Brokers. Except for the fees to be paid to Standard Chartered pursuant to its engagement letter with the Company, a true and complete copy of which has been delivered to Parent, none of the Company, nor any of its affiliates, nor any of their

respective officers, directors or employees has employed any broker or finder or incurred any liability for any brokerage fees, commissions or finder’s fees in connection with the transactions contemplated by this Agreement.

(35) Reporting Issuer Status. As of the date hereof, the Company is a reporting issuer not in default (or the equivalent) under the Securities Laws of each of the Provinces of British Columbia, Alberta, Manitoba and Ontario.

(36) Stock Exchange Compliance. The Company is in compliance in all material respects with the applicable listing and corporate governance rules and regulations of the Exchange.

(37) No Expropriation. No property or asset of the Company, its affiliates, or the Joint Venture (including any Property or Mineral Rights) has been taken or expropriated by any Governmental Entity nor has any notice or proceeding in respect thereof been given or commenced nor, to the knowledge of the Company, is there any intent or proposal to give any such notice or to commence any such proceeding.

(38) Board Recommendation. The Company Board, after receiving legal and financial advice, has determined that the Arrangement Resolution is in the best interests of the Company and recommends that Company Shareholders vote in favour of the Arrangement Resolution, and each director and senior officer of the Company has notified the Company Board that he intends to vote all of such individual’s Company Shares in favour of the Arrangement Resolution and against any resolution submitted by any Company Shareholder that is inconsistent with the Arrangement.

(39) Subsidiaries. The Company has commenced the process required to liquidate, wind-up or dissolve each of Inter-Citic Holdings Ltd. and Techmat Inc. in accordance with applicable law and has not been advised that such processes cannot be completed.

SCHEDULE D

REGULATORY APPROVALS

Parent needs to obtain the following approval processes within the jurisdiction:

1、青海省国有资产监督管理委员会（State-owned Assets Supervision and Administration Commission of Qinghai Province）Approval;

2、中华人民共和国国家发展和改革委员会（National Development and Reform Commission of the People’s Republic of China approval);

3、中华人民共和国商务部（Ministry of Commerce of the People’s Republic of China）Approval;

4、国家外汇管理局青海省分局（The State Administration of Foreign Exchange Bureau of Qinghai Province）Registration;

APPENDIX C – PLAN OF ARRANGEMENT

PLAN OF ARRANGEMENT UNDER SECTION 192OF THE CANADA BUSINESS CORPORATIONS ACT

1. INTERPRETATION

(a) Definitions: In this Plan of Arrangement, unless the context otherwise requires, the following words and terms shall have the meaning hereinafter set out:

“Acquireco” means ��, a wholly-owned subsidiary of Parent existing under the laws of Canada;

“Arrangement” means this arrangement under the provisions of section 192 of the CBCA, on the terms and conditions set forth in this Plan of Arrangement, subject to any amendments or supplements hereto made in accordance with the Arrangement Agreement and the provisions hereof or made at the direction of the Court in the Final Order, (in each case with the consent of the Company and Parent, each acting reasonably);

“Arrangement Agreement” means the Arrangement Agreement dated as of August 24, 2012 among Parent, Parent on behalf of a company to be incorporated as its indirect wholly-owned subsidiary under the CBCA and the Company, to which this Plan of Arrangement is attached as Schedule A, as may be amended, amended and restated, or supplemented in accordance with its terms prior to the Effective Date;

“Arrangement Resolution” means the Special Resolution of Company Shareholders approving the Arrangement and presented at the Company Shareholder Meeting;

“Articles of Arrangement” means the articles of arrangement of the Company in respect of the Arrangement, required by the CBCA to be sent to the Director after the Final Order is made, which shall include this Plan of Arrangement and otherwise be in a form and content satisfactory to the Company and Parent, each acting reasonably;

“Business Day” means a day which is not a Saturday, Sunday or a civic or statutory holiday in Beijing, China or Toronto, Canada;

“CBCA” means the Canada Business Corporations Act, as amended;

“Certificate of Arrangement” means the certificate of arrangement to be issued by the Director pursuant to subsection 192(7) of the CBCA in respect of the Articles of Arrangement;

“Company” means Inter-Citic Minerals Inc.;

“Company Options” means the outstanding options to purchase Company Shares issued pursuant to the Company’s stock option plans(s);

“Company Securityholders” means, collectively, the Company Shareholders, and holders of Company Options and Company Warrants;

“Company Shareholder” means a Person who is a registered holder of Company Shares as shown on the share register of the Company and for the purposes of the Company Shareholder Meeting, is a registered holder of Company Shares as of the record date therefor, and for the purposes of the Arrangement, is a registered holder of Company Shares immediately prior to the Effective Time;

“Company Shareholder Meeting” means the special meeting of Company Shareholders, including any adjournments or postponements of such special meeting in accordance with the terms of the Arrangement Agreement, to be called and held in accordance with the Interim Order to consider the Arrangement Resolution;

“Company Shares” means the common shares in the capital of the Companyas presently constituted;

“Company Warrants” means the outstanding warrants to purchase Company shares;

”Consideration” means $2.05 in cash per Company Share;

“Court” means the Superior Court of Justice (Ontario);

“Depositary” means Computershare Trust Company of Canada or other any trust company, bank or financial institution agreed to in writing between Parent and the Company for the purpose of, among other things, acting as depository for purposes of, paying the cash consideration under this Arrangement;

“Director” means the Director appointed pursuant to section 260 of the CBCA;

“Dissent Procedures” means the procedures set forth in section 190 of the CBCA and the Interim Order required to be taken by a Company Shareholder to exercise the right of dissent in respect of Company Shares in connection with this Arrangement;

“Dissent Rights” means the rights of dissent of Company Shareholders in respect of the Arrangement Resolution as defined in Section 4 hereof;

“Dissenting Company Shareholder” means a registered Company Shareholder who has duly exercised a Dissent Right in strict compliance with

the Dissent Procedures, and has not withdrawn or been deemed to have withdrawn such exercise of Dissent Rights, but only in respect of the Company Shares in respect of which such Dissent Rights are validly exercised by such Company Shareholder;

“Effective Date” means the date shown in the Certificate of Arrangement giving effect to the Plan of Arrangement;

“Effective Time” means the time when the Arrangement will be deemed to have been completed, which shall be 12:01 a.m., Toronto time, on the Effective Date;

“Encumbrance” means any mortgage, hypothec, pledge, assignment, charge, lien, claim, security interest, adverse interest, other third Person interest or encumbrance of any kind, whether contingent or absolute, and any agreement, option, right or privilege (whether by law, contract or otherwise) capable of becoming any of the foregoing;

“Final Order” means the final order of the Court approving the Arrangement, in form and content agreed by the Company and Parent, each acting reasonably, as such order may be amended by the Court (with the consent of Parent and the Company, each acting reasonably) at any time prior to the Effective Date or, if appealed, then unless such appeal is withdrawn or denied, as affirmed or as amended on appeal (provided that such amendment is acceptable to both the Company and Parent, each acting reasonably);

“Interim Order” means the interim order of the Court, in form and content agreed by the Company and Parent, each acting reasonably, providing for, among other things, the calling and holding of the Company Shareholder Meeting in accordance with the Arrangement Agreement, as such order may be amended, supplemented or varied by the Court with the consent of the Company and Parent, each acting reasonably;

“Letter of Transmittal” means the letter of transmittal to be delivered by the Company to the Company Shareholders providing for the delivery of the Company Shares to the Depositary;

“Parent” means Western Mining Group Co., Ltd., a corporation established and existing under the Company Law of the People’s Republic of China;

“Person” means any individual, corporation, firm, partnership (including, without limitation, a limited partnership), sole proprietorship, syndicate, joint venture, trustee, trust, any unincorporated organization or association, any government or instrumentality thereof and any tribunal;

“Rights Plan” means the Amended and Restated Shareholder Rights Plan Agreement dated April 24, 2010 between the Company and Computershare Investor Services Inc.;

“Special Resolution” has the meaning ascribed to such term in the CBCA;

“SRP Rights” means the rights issuable pursuant to the Rights Plan; and

“Tax Act” means the Income Tax Act (Canada) and the regulations thereunder as amended from time to time.

(b) Interpretation Not Affected by Headings. The headings contained in this Plan of Arrangement are for convenience of reference only and shall not affect in any way the meaning or interpretation of this Plan of Arrangement. The terms “this Plan of Arrangement”, “hereof’, “herein”, “hereto”, “hereunder” and similar expressions refer to this Plan of Arrangement and not to any particular article, section, subsection, paragraph, subparagraph, clause or sub-clause hereof and include any agreement or instrument supplementary or ancillary hereto.

(c) Date for any Action. If the date on which any action is required to be taken hereunder is not a Business Day, such action shall be required to be taken on the next succeeding day which is a Business Day.

(d) Number and Gender. In this Plan of Arrangement, unless the context otherwise requires, words importing the singular include the plural and vice versa and words importing gender include all genders and neuter.

(e) References to Persons and Statutes. A reference to a Person includes any successor to that Person. A reference to any statute includes all regulations made pursuant to such statute and the provisions of any statute or regulation which amends, supplements or supersedes any such statute or regulation.

(f) Currency. Unless otherwise stated in this Plan of Arrangement, all references herein to amounts of money are expressed in lawful money of Canada.

(g) Computation of Time. Time is of the essence in every matter or action contemplated hereunder. A period of time is to be computed as beginning on the day following the event that began the period and ending at 4:30 p.m. on the last day of the period if the last day of the period is a Business Day, or at 4:30 p.m. on the next Business Day if the last day of the period is not a Business Day.

(h) Time References. References to time are to local time, Toronto, Ontario.

2. ARRANGEMENT AGREEMENT

This Plan of Arrangement and the Arrangement are made pursuant to and subject to the provisions of the Arrangement Agreement. At the Effective Time, the Arrangement shall be binding upon Parent, Acquireco, the Company, all registered and beneficial Company Shareholders (including Dissenting Company Shareholders), holders of Company Options, holders of Company Warrants, the Depositary and the registrar and transfer agent of the Company, without any further act or formality required on the part of any such Persons.

3. THE ARRANGEMENT

(a) The Arrangement. At and following the Effective Time, the following shall occur and shall be deemed to occur in the following order and at the times set out in this Section 3 without any further authorization, act or formality required on the part of any Person, except as expressly provided herein:

(i) at the Effective Time, if the Rights Plan is in effect, or if the SRP Rights have not been redeemed or waived, the Rights Plan will be terminated, and each SRP Right will be terminated without any payment in respect thereof;

(ii) at one minute after the Effective Time, Acquireco shall advance to the Company an amount of cash equal to the amount required to settle and cancel Company Options in accordance with (iii) below, which advance shall be evidenced by a non-interest bearing demand promissory note issued by the Company to Acquireco;

(iii) at two minutes after the Effective Time, each Company Option (whether vested or unvested) that has not been duly exercised prior to the Effective Time will be deemed to be assigned and transferred by the holder of the Company Option to the Company (free and clear of all Encumbrances) and be cancelled in exchange for a cash payment from the Company equal to the amount by which the Consideration exceeds the exercise price per each Company Option, subject to applicable withholdings and other source deductions in accordance with Section 5(f), and the remaining Company Options outstanding at such time shall terminate without any cash payment or payment of any sort and all of the Company stock option plans shall terminate and cease to have any further force or effect;

(iv) at three minutes after the Effective Time, each Company Warrant that has not been duly exercised prior to the Effective Time will be deemed to be assigned and transferred by the holder of the Company Warrant to Acquireco (free and clear of all Encumbrances) in exchange for a cash payment from Acquireco equal to the amount by which the Consideration exceeds the exercise price per each Company Warrant, subject to applicable withholdings and other source deductions in accordance with Section 5(f), and if the amount of such

payment is determined to be zero or less than zero, then such Company Warrant shall be assigned, transferred and cancelled without any cash payment or payment of any sort;

(v) at four minutes after the Effective Time, each Company Share in respect of which a holder of Company Shares has validly exercised his, her or its Dissent Right shall be deemed to be assigned and transferred by such Dissenting Holder to Acquireco (free and clear of all Encumbrances) in consideration for a debt claim against Acquireco to be paid fair value for such Company Shares pursuant to the Dissent Procedures;

(vi) at five minutes after the Effective Time, each Company Share outstanding at the Effective Time, other than Company Shares held by a Dissenting Holder who has validly exercised his, her or its Dissent Right and Company Shares held by Acquireco and its affiliates, if any, shall be deemed to be assigned and transferred by the holder thereof to Acquireco (free and clear of all Encumbrances), in exchange for the Consideration for each Company Share; and

(vii) the names of the holders of the Company Shares transferred to Acquireco shall be removed from the applicable register of holders of Company Shares, and Acquireco shall be recorded as the registered holder of the Company Shares so assigned and transferred and Acquireco shall be the legal and beneficial owner thereof;

provided that none of the foregoing will occur or be deemed to occur unless all of the forgoing occurs.

4. RIGHTS OF DISSENT

Company Shareholders shall be entitled to exercise dissent rights (“Dissent Rights”) with respect to the Company Shares pursuant to and in the manner set forth in section 190 of the CBCA as modified by the Interim Order and this Section 4, but provided that notwithstanding subsection 190(5) of the CBCA, such Dissenting Company Shareholder delivers to the Company written objection to the Arrangement Resolution by 5:00 p.m. (Toronto time) on the Business Day immediately prior to the date of the Company Shareholder Meeting and otherwise complies with section 190 of the CBCA (the “Dissent Procedures”).

If the Arrangement is concluded, a Company Shareholder who exercises Dissent Rights in strict compliance with the Dissent Procedures shall be entitled to be paid by the Company the fair value of the Company Shares held by such Dissenting Company Shareholder in respect of which such Dissenting Company Shareholder dissents, determined as provided for in the CBCA, as modified by the Interim Order and this Section 4, provided that any such Dissenting Company Shareholder who exercises such right to dissent and who:

(a) is ultimately entitled to be paid fair value for its Company Shares shall be deemed to have directly assigned and transferred its Company Shares to Aquireco in consideration for a debt claim against Acquireco to be paid fair value of such shares pursuant to the Dissent Procedures, and shall not be entitled to any other payment or consideration, including any payment under the Arrangement had such holders not exercised their Dissent Rights; or

(b) is for any reason ultimately not entitled to be paid for fair value for its Company Shares, shall be deemed to have participated in the Arrangement as of the Effective Time at the same terms and at the same time as a non-dissenting Company Shareholder and shall be issued only the same consideration which a Company Shareholder is entitled to receive under the Arrangement as if such Dissenting Company Shareholder would not have exercised Dissent Rights.

In no case shall Parent, Acquireco, the Company or the Depositary be required to recognize Dissenting Company Shareholders or a Company Shareholder at and after the Effective Time, and the names of all such Company Shareholders shall be removed from the share register of the Company at the Effective Time in accordance with Section 3. In addition to any other restriction in section 190 of the CBCA, none of the following shall be entitled to exercise Dissent Rights: (i) holders of Company Options, (ii) holders of Company Warrants, and (iii) Company Shareholders who vote in favour of the Arrangement Resolution.

5. DELIVERY OF CONSIDERATION

(a) Funding of Depositary for Options and Warrants. On or prior to the Effective Date, Acquireco shall deposit cash in immediately available funds (at Toronto) with the Company an amount sufficient to pay all amounts payable to the holders of Company Options pursuant to Section 3(a)(iii), and with the Depositary in an amount sufficient to pay Company Warrants pursuant to Section 3(a)(iv). From and after the transfer of the Company Options to the Company and the Company Warrants to Acquireco pursuant to this Arrangement, the Depositary shall be considered to hold such funds for the sole benefit of the holders of such Company Warrants assigned and transferred to Acquireco and the Company shall be considered to hold such funds for the sole benefit of the holders of Company Options transferred to the Company. Upon surrender to the Depositary for cancellation of a certificate or other instrument or acknowledgment which immediately prior to the Effective Time represented outstanding Company Warrants that were assigned and transferred to the Company or Acquireco as the case may be, together with such additional documents and instruments as the Depositary or the Company may reasonably require, the holder of such surrendered certificate or other instrument shall be entitled to receive in exchange therefor, and the Depositary shall deliver to such holder, the cash which such holder has the right to receive pursuant to Section 3 hereof, net of any applicable withholding taxes.

(b) Funding of Depositary for Shares. On or prior to the Effective Date, Acquireco shall deposit cash in immediately available funds (at Toronto) with the Depositary for the benefit of Company Shareholders, in an amount sufficient to pay all cash consideration payable by it to Company

Shareholders under this Arrangement. From and after the deposit of such cash, the Depositary shall be considered to hold such funds for the sole benefit of the Company Shareholders. Upon surrender to the Depositary for cancellation of a certificate which immediately prior to the Effective Time represented outstanding Company Shares that were exchanged for the Consideration under this Arrangement, together with such other documents or instruments as would have been required to effect the transfer of such Company Shares under the articles and by-laws of the Company, together with such additional documents and instruments as the Depositary may reasonably require, the holder of such surrendered certificate or other instrument shall be entitled to receive in exchange therefor, and the Depositary shall deliver to such holder the cash which such holder has the right to receive pursuant to Section 3 hereof, net of any applicable withholding taxes. For greater certainty, a holder of Company Shares right to receive cash under the Arrangement shall be satisfied only out of the amount deposited pursuant to this Section 5(b), and each holder shall have no further right or claim against the Company, Parent, Acquireco or the Depository except to the extent that the cash so deposited is insufficient to satisfy the amounts payable to such former holders under the Arrangement.

(c) Holding of Cash. The cash deposited with the Depositary shall be held in an interest bearing account, and any interest earned upon such funds shall be for the account of Acquireco. Until surrendered as contemplated by this Section 5, each certificate or other instrument which immediately prior to the Effective Time represented Company Shares or Company Options or Company Warrants shall be deemed at all times after the Effective Time to represent only the right to receive upon such surrender a cash payment in lieu of such certificates as contemplated in this Arrangement.

(d) Lost Certificates. In the event that any certificate which immediately prior to the Effective Time represented one or more Company Shares which were exchanged in accordance with Section 3 hereof shall have been lost, stolen or destroyed, upon the making of an affidavit of that fact by the holder claiming such certificate to be lost, stolen or destroyed, the Depositary shall deliver in exchange for such lost, stolen or destroyed certificate, the Consideration to which such Company Shareholder is entitled to receive in accordance with Section 3 hereof. When authorizing such delivery of Consideration, the Company Shareholder to whom the Consideration is to be delivered shall, as a condition precedent to the delivery of such Consideration, give a bond satisfactory to the Company, Parent, Acquireco and the Depositary in such amount as the Company, Parent, Acquireco and the Depositary may direct, or otherwise indemnify the Company, Parent, Acquireco and the Depositary in a manner satisfactory to them, against any claim that may be made against the Company, Parent, Acquireco or the Depositary with respect to the certificate alleged to have been lost, stolen or destroyed and shall otherwise take such actions as may be required by the by-laws of the Company.

(e) Termination of Rights. If any Company Shareholder fails for any reason to deliver to the Depositary for cancellation the certificates formerly representing Company Shares (or an affidavit of loss and bond or other indemnity pursuant to this Section), together with such other documents or instruments required to effect the transfer of Company Shares, on or before the sixth anniversary of the Effective Date, such Company Shareholder shall be deemed to have donated and forfeited to Acquireco any cash, net of any applicable withholding or other taxes, held by the Depositary in trust for such Company Shareholder to which such Company Shareholder is entitled.

(f) Withholding Rights. Parent, Acquireco, the Company, and the Depositary shall be entitled to deduct and withhold from all amounts payable to any Company Shareholder or holder of Company Options or Company Warrants, as applicable, such amounts as Parent, Acquireco, the Company, or the Depositary is required or permitted to deduct and withhold with respect to such payment under the Tax Act, the United States Internal Revenue Code of 1986 or any provision of any applicable federal, provincial, state, local or foreign tax law, in each case, as amended. To the extent that amounts are so withheld, such withheld amounts shall be treated for all purposes hereof as having been paid to the Company Shareholder or holder of Company Options or Company Warrants, as applicable, in respect of which such deduction and withholding was made, provided that such withheld amounts are actually remitted to the appropriate taxing authority.

6. ADJUSTMENT TO CONSIDERATION

(a) If, after the date of the Arrangement Agreement, the Company changes the number of Company Shares or securities convertible into or exchangeable for or exercisable to acquire Company Shares, in each case, issued and outstanding prior to the Effective Time as a result of a reclassification, stock split (including reverse split), dividend or distribution, recapitalization, merger, subdivision, combination, issuer bid or exchange offer, or other similar transaction, the Consideration and the consideration payable for each Company Option and Company Warrant pursuant to Section 3 hereof will be adjusted appropriately to provide the Company Securityholders the same economic effect as contemplated by this Plan of Arrangement prior to such reclassification, stock split (including reverse split), dividend or distribution, recapitalization, merger, subdivision, combination, issuer bid or exchange offer, or similar transaction.

(b) If, on or after the date hereof, the Company declares, sets aside or pays any dividend or other distribution payable in cash, securities, property or otherwise with respect to the Company Shares, or sets a record date therefor that is prior to the Effective Date, then the Consideration shall be reduced to reflect such dividend or other distribution by way of a reduction to the Consideration by an amount per Company Share equal to the fair market value of such dividend or other distribution.

7. AMENDMENT

(a) Amendment.

(i) Parent and the Company reserve the right to amend, modify and/or supplement this Plan of Arrangement at any time and from time to time prior to the Effective Date, provided that any amendment, modification or supplement must be contained in a written document which is agreed to by the Company and Parent and filed with the Court and, if made following the Company Shareholder Meeting, then: (i) approved by the Court, and (ii) if the Court directs, approved by the Company Shareholders and in any event communicated to them, and in either case in the manner required by the Court.

(ii) Any amendment, modification or supplement to this Plan of Arrangement, if agreed to by the Company and Parent, may be made at any time prior to or at the Company Shareholder Meeting, with or without any other prior notice or communication and, if so proposed and accepted by Persons voting at the Company Shareholder Meeting (other than as may be required under the Interim Order) shall become part of this Plan of Arrangement for all purposes.

(iii) Any amendment, modification or supplement to this Plan of Arrangement that is approved or directed by the Court following the Company Shareholder Meeting will be effective only if it is consented to by the Company and Parent and, if required by the Court, by the Company Shareholders.

(iv) Notwithstanding the foregoing provisions of this Section 7, no amendment, modification or supplement of this Plan of Arrangement may be made prior to the Effective Time except in accordance with the terms of the Arrangement Agreement.

(v) Notwithstanding anything in this Plan of Arrangement or the Arrangement Agreement, Parent shall be entitled, at any time prior to or following the Company Shareholder Meeting, to modify this Plan of Arrangement to increase the consideration Parent is prepared to make available to Company Securityholders pursuant to the Arrangement, whether or not the board of directors of the Company has changed its recommendation, provided that Parent shall use its commercially reasonable efforts to provide not less than one Business Day's prior written notice of such proposal to the Company.

(vi) Notwithstanding anything in this Plan of Arrangement or the Arrangement Agreement, no amendment, revision, update or supplement shall be made to the Plan of Arrangement that (i) would require the Company to obtain any regulatory approval or the approval of Company Securityholders in respect of such amendment,

revision, update or supplement other than at the Company Shareholder Meeting, (ii) would prejudice in any material respect Company's Shareholders or would result in the withdrawal or material modification of the fairness opinion received by the board of directors of the Company, (iii) would impede or materially delay the consummation of the transactions contemplated by the Plan of Arrangement, or (iv) would require the Company to take any action in contravention of applicable Law, the constating documents of the Company or any material provision of any material agreement to which it is a party.

8. FURTHER ASSURANCES

Notwithstanding that the transactions and events set out in this Plan of Arrangement shall occur and shall be deemed to occur in the order set out in this Plan of Arrangement without any further act or formality, each of the parties to the Arrangement Agreement shall make, do and execute, or cause to be made, done and executed, all such further acts, deeds, agreements, transfers, assurances, instruments or documents as may reasonably be required by any of them in order further to document or evidence any of the transactions or events set out in this Plan of Arrangement. For greater certainty, Parent shall cause Acquireco to perform all of its obligations pursuant to the Plan of Arrangement.

APPENDIX D – OPINION OF STANDARD CHARTERED

Gryphon Partners Canada Inc.A Standard Chartered group company20 Adelaide Street East, Suite 1105Toronto, Ontario M5C 2T6 Tel (1) 416 368 0040Canada Fax (1) 416 368 0046

August 24, 2012

The Board of Directors of Inter-Citic Minerals Inc.60 Columbia Way, Suite 501Markham, OntarioCanada L3R 0C9

To the Board of Directors:

We understand that Inter-Citic Minerals Inc. (the “Company”) is contemplating a transaction (the “Transaction”) with Western Mining Group Co., Ltd. (“Western Mining”) pursuant to which the shareholders of the Company (the “Shareholders”) will be entitled to receive, in exchange for each common share of the Company held (each a “Share”), C$2.05 in cash (the “Consideration”). We also understand that the Transaction is proposed to be effected by way of a court-approved plan of arrangement (the “Arrangement”) under Section 192 of the Canada Business Corporations Act.

The terms and conditions of the Arrangement will be summarized in a proxy circular (the “Proxy Circular”) to be mailed by the Company to Shareholders in connection with a special meeting of Shareholders (the “Meeting”) to be held to consider and, if deemed advisable, approve the Arrangement. The implementation of the Arrangement will be conditional upon, among other things, (i) the approval of the Arrangement by at least 66 2/3% of the votes cast at such special meeting by Shareholders present in person or by proxy, as well as approved by a simple majority of the votes cast at the Meeting, excluding the votes cast by any holders of Shares that are required to be excluded in order to obtain “minority approval” pursuant to Multilateral Instrument 61-101; and (ii) approval of the Arrangement by the Ontario Superior Court of Justice.

The terms and conditions of, and other matters relating to, the Transaction and the Arrangement have been set forth in an arrangement agreement dated August 24, 2012 and entered into among the Company and Western Mining (the “Arrangement Agreement”).

Gryphon Partners Canada Inc., a wholly-owned subsidiary of Standard Chartered Bank, has been retained to provide financial advice to the Company, including our opinion (the “Opinion”) as to the fairness, from a financial point of view, of the Consideration to be received by Shareholders pursuant to the Arrangement.

In this Opinion, “Standard Chartered” means Gryphon Partners Canada Inc., the issuer of this Opinion. The “Standard Chartered Group” means Standard Chartered Bank and its affiliates (including Gryphon Partners Canada Inc.).

Engagement of Standard Chartered

By letter agreement between the Company and Standard Chartered Securities (North America) Inc. dated January 13, 2011 as amended on April 5, 2011 and novated by Standard Chartered Securities (North America) Inc. to Gryphon Partners Canada Inc. on June 1, 2012 (the “Engagement Agreement”), the Company has retained Standard Chartered to assist and advise the Company in exploring financing alternatives. Standard Chartered was not engaged to review any tax, legal or accounting aspects of the Arrangement.

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In connection with this Opinion, Standard Chartered will be paid a fixed fee upon the delivery of this Opinion (the “Opinion Fee”). No portion of the Opinion Fee is conditional upon the success or failure of the Transaction. However, if the Transaction is successful, Standard Chartered will be paid an additional fee upon the closing of the Transaction. If the Transaction is terminated, abandoned or terminated, and the Company or its affiliates are paid, granted or otherwise become entitled to any consideration in connection therewith, Standard Chartered will be entitled to a break up fee which is payable upon the Company’s receipt of such consideration. In addition, Standard Chartered will be reimbursed for its reasonable out-of-pocket expenses and is to be indemnified by the Company in the manner set forth in the indemnity that forms part of the Engagement Agreement. The Opinion is addressed to the Board of Directors of the Company and may also be relied upon by the Special Committee of the Board of Directors of the Company formed to consider the Transaction.

Standard Chartered consents to the inclusion of this Opinion in its entirety and a summary thereof (in a form acceptable to Standard Chartered) in the Proxy Circular.

Credentials of the Standard Chartered Group

The Standard Chartered Group is a leading global financial institution providing a full range of wholesale banking services including mergers and acquisitions, divestitures, valuation and financial restructuring services.

The opinion expressed herein is the opinion of Standard Chartered and the form and content herein have been approved for release by the Fairness Opinion Committee of the Standard Chartered Group Wholesale Bank’s Corporate Finance business unit, the members of which are experienced in mergers, acquisitions, divestitures and fairness opinion matters.

Scope of Review

In connection with rendering the Opinion, we have reviewed and relied upon, or carried out, among other things, the following:

1. the Arrangement Agreement;2. the audited annual financial statements of the Company, together with the management discussion and

analysis related thereto, for each of the three years ended November 30, 2011, 2010 and 2009;3. the unaudited amended interim financial statements of the Company together with the management

discussion and analysis related thereto, for the three months ended February 29 and May 31, 2012;4. the annual information forms of the Company for the years ended November 30, 2011, 2010 and 2009;5. the management information circulars of the Company dated April 27, 2012, April 28, 2011 and April 26, 2010;6. the Technical Report on the Update Mineral Resource for the Dachang Gold Project, published June 28, 2011;7. the Preliminary Economic Assessment for the Dachang Gold Project completed by Micon International, dated

August 2009;8. various corporate presentations and other marketing materials prepared by Company management;9. forecast analyst pricing estimates, as per Bloomberg;10. publicly available information relating to the business, operations, financial performance and stock trading

history of the Company, and other selected public companies and precedent transactions we considered relevant; and

11. certain other information prepared and provided by the Company concerning its business, operations, assets, liabilities and prospects.

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Standard Chartered has not, to the best of its knowledge, been denied access by the Company to any information under its control requested by Standard Chartered. Standard Chartered did not meet with the auditors of the Company and has assumed the accuracy and fair presentation of and relied upon the financial statements of the Company and the reports of the auditors thereon.

Assumptions and Limitations

The Opinion is subject to the assumptions, explanations and limitations set forth below.

We have not been asked to prepare and have not prepared a valuation of the Company or Western Mining or any of their respective securities or assets and the Opinion should not be construed as such.

With the Company’s approval and agreement, we have relied upon the completeness, accuracy and fair presentation in all material respects of all financial information, business plans, forecasts and other information, data, advice, opinions and representations obtained by us from public sources or provided to us by or on behalf of the Company, Western Mining, any of their subsidiaries and their respective directors, officers, associates, affiliates, consultants, advisors and representatives relating to the Company, Western Mining, their subsidiaries, associates and affiliates, and to the Transaction, or otherwise obtained by us pursuant to our engagement. We have assumed that all such information was, and continues to be, complete and accurate and did not and does not omit to state any material fact or any fact necessary to be stated to make such information not misleading. The Opinion is conditional upon such completeness, accuracy, fair presentation and non-omission of facts. We have not been requested or, subject to the exercise of professional judgment, attempted to verify independently the completeness, accuracy or fair presentation of any such information, data, advice, opinions, representations and other material.

Senior officers of the Company have represented to Standard Chartered in a certificate delivered as of the date hereof, among other things, that (i) with the exception of forecasts, projections or estimates therein, the information, data, advice, opinions, representations and other material (financial and otherwise) (the “Information”) provided orally or in writing by, or in the presence of, an officer or employee of the Company or any of its subsidiaries (as such terms are defined in the Securities Act (Ontario)) or their respective directors, officers, associates, affiliates, consultants, advisors and representatives to Standard Chartered or obtained by Standard Chartered from the System for Electronic Document Analysis and Retrieval (SEDAR) relating to the Company its subsidiaries, associates, affiliates or the Transaction for the purpose of preparing the Opinion, to the best of their knowledge, is, or in the case of historical information, was as of the date the Information was provided to Standard Chartered, complete, true and correct in all material respects and did not and does not contain any untrue statement of a material fact in respect of the Company, its subsidiaries, associates, affiliates or the Transaction and did not and does not omit to state a material fact in respect of the Company, its subsidiaries, associates, affiliates or the Transaction necessary to make the Information not misleading in light of the circumstances under which the Information was made or; and that (ii) since the dates on which the Information was provided to Standard Chartered, except as disclosed in writing to Standard Chartered, or as publically disclosed, there has been no material change, financial or otherwise, in the financial condition, assets, liabilities (contingent or otherwise), business, operations or prospects of the Company or any of its subsidiaries and no material change has occurred in the Information or any part thereof which would have or which would reasonably be expected to have a material effect on the Opinion.

With respect to any forecasts, projections, estimates and/or budgets provided to Standard Chartered and used in its analyses, Standard Chartered notes that projecting future results of any company is inherently subject to uncertainty. Standard Chartered has assumed, however, that such forecasts, projections, estimates and/or budgets were prepared using

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the assumptions identified therein, which, in the opinion of the Company, are (or were at the time and continue to be) reasonable in the circumstances.

In preparing the Opinion, Standard Chartered has made several assumptions, including that all of the conditions required to implement the Transaction will be met and that the disclosure provided or incorporated by reference in the Proxy Circular with respect to the Company, Western Mining and their subsidiaries and affiliates and the Transaction will be accurate in all material respects.

The Opinion is rendered as at the date hereof and on the basis of securities markets, economic and general business and financial conditions prevailing as at the date hereof and the conditions and prospects, financial and otherwise, of the Company and Western Mining as they were represented to us in our discussions with the management of the Company. In our analyses and in connection with the preparation of the Opinion, we made numerous assumptions with respect to industry performance, general business, market and economic conditions and other matters, many of which are beyond the control of Standard Chartered and any party involved in the Transaction.

The Opinion is provided to the Board of Directors of the Company for its use only and, except as aforesaid, may not be relied upon by any other person. Standard Chartered disclaims any undertaking or obligation to advise any person of any change in any fact or matter affecting the Opinion which may come or be brought to the attention of Standard Chartered after the date hereof. Without limiting the foregoing, in the event that there is any material change in any fact or matter affecting the Opinion after the date hereof, Standard Chartered reserves the right to change, modify or withdraw the Opinion.

The preparation of a fairness opinion is a complex process and is not necessarily capable of being partially analyzed or summarized. Standard Chartered believes that its analyses must be considered as a whole and that selecting portions of the analyses or the factors considered by it, without considering all factors and analyses together, could create an incomplete view of the process underlying the Opinion. The Opinion should be read in its entirety and should not be construed as a recommendation to any Shareholder as to whether to vote their Shares in favour of approving the Arrangement, or how to otherwise act with respect to the Transaction.

Opinion

Based upon and subject to the foregoing and such other matters as we considered relevant, it is our opinion, as of the date hereof that the Consideration to be received pursuant to the Arrangement is fair, from a financial point of view, to the Shareholders.

Yours truly,

Gryphon Partners Canada Inc.

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APPENDIX E – NOTICE OF APPLICATION FOR FINAL ORDER

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APPENDIX F – INTERIM ORDER

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APPENDIX G - SECTION 190 OF THE CANADA BUSINESS CORPORATIONS ACT

190. (1) Right to dissent — Subject to sections 191 and 241, a holder of shares of any class of a corporation may dissent if the corporation is subject to an order under paragraph 192(4)(d) that affects the holder or if the corporation resolves to

(a) amend its articles under section 173 or 174 to add, change or remove any provisions restricting or constraining the issue, transfer or ownership of shares of that class;

(b) amend its articles under section 173 to add, change or remove any restriction on the business or businesses that the corporation may carry on;

(c) amalgamate otherwise than under section 184;

(d) be continued under section 188;

(e) sell, lease or exchange all or substantially all its property under subsection 189(3); or

(f) carry out a going-private transaction or a squeeze-out transaction.

(2) Further right — A holder of shares of any class or series of shares entitled to vote under section 176 may dissent if the corporation resolves to amend its articles in a manner described in that section.

(2.1) If one class of shares — The right to dissent described in subsection (2) applies even if there is only one class of shares.

(3) Payment for shares — In addition to any other right the shareholder may have, but subject to subsection (26), a shareholder who complies with this section is entitled, when the action approved by the resolution from which the shareholder dissents or an order made under subsection 192(4) becomes effective, to be paid by the corporation the fair value of the shares in respect of which the shareholder dissents, determined as of the close of business on the day before the resolution was adopted or the order was made.

(4) No partial dissent — A dissenting shareholder may only claim under this section with respect to all the shares of a class held on behalf of any one beneficial owner and registered in the name of the dissenting shareholder.

(5) Objection — A dissenting shareholder shall send to the corporation, at or before any meeting of shareholders at which a resolution referred to in subsection (1) or (2) is to be voted on, a written objection to the resolution, unless the corporation did not give notice to the shareholder of the purpose of the meeting and of their right to dissent.

(6) Notice of resolution — The corporation shall, within ten days after the shareholders adopt the resolution, send to each shareholder who has filed the objection referred to in subsection (5) notice that the resolution has been adopted, but such notice is not required to be sent to any shareholder who voted for the resolution or who has withdrawn their objection.

(7) Demand for payment — A dissenting shareholder shall, within twenty days after receiving a notice under subsection (6) or, if the shareholder does not receive such notice, within twenty days after learning that the resolution has been adopted, send to the corporation a written notice containing

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(a) the shareholder’s name and address;

(b) the number and class of shares in respect of which the shareholder dissents; and

(c) a demand for payment of the fair value of such shares.

(8) Share certificate — A dissenting shareholder shall, within thirty days after sending a notice under subsection (7), send the certificates representing the shares in respect of which the shareholder dissents to the corporation or its transfer agent.

(9) Forfeiture — A dissenting shareholder who fails to comply with subsection (8) has no right to make a claim under this section.

(10) Endorsing certificate — A corporation or its transfer agent shall endorse on any share certificate received under subsection (8) a notice that the holder is a dissenting shareholder under this section and shall forthwith return the share certificates to the dissenting shareholder.

(11) Suspension of rights — On sending a notice under subsection (7), a dissenting shareholder ceases to have any rights as a shareholder other than to be paid the fair value of their shares as determined under this section except where

(a) the shareholder withdraws that notice before the corporation makes an offer under subsection (12);

(b) the corporation fails to make an offer in accordance with subsection (12) and the shareholder withdraws the notice; or

(c) the directors revoke a resolution to amend the articles under subsection 173(2) or 174(5), terminate an amalgamation agreement under subsection 183(6) or an application for continuance under subsection 188(6), or abandon a sale, lease or exchange under subsection 189(9),

in which case the shareholder’s rights are reinstated as of the date the notice was sent.

(12) Offer to pay — A corporation shall, not later than seven days after the later of the day on which the action approved by the resolution is effective or the day the corporation received the notice referred to in subsection (7), send to each dissenting shareholder who has sent such notice

(a) a written offer to pay for their shares in an amount considered by the directors of the corporation to be the fair value, accompanied by a statement showing how the fair value was determined; or

(b) if subsection (26) applies, a notification that it is unable lawfully to pay dissenting shareholders for their shares.

(13) Same terms — Every offer made under subsection (12) for shares of the same class or series shall be on the same terms.

(14) Payment — Subject to subsection (26), a corporation shall pay for the shares of a dissenting shareholder within ten days after an offer made under subsection (12) has been accepted, but any such offer lapses if the corporation does not receive an acceptance thereof within thirty days after the offer has been made.

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(15) Corporation may apply to court — Where a corporation fails to make an offer under subsection (12), or if a dissenting shareholder fails to accept an offer, the corporation may, within fifty days after the action approved by the resolution is effective or within such further period as a court may allow, apply to a court to fix a fair value for the shares of any dissenting shareholder.

(16) Shareholder application to court — If a corporation fails to apply to a court under subsection (15), a dissenting shareholder may apply to a court for the same purpose within a further period of twenty days or within such further period as a court may allow.

(17) Venue — An application under subsection (15) or (16) shall be made to a court having jurisdiction in the place where the corporation has its registered office or in the province where the dissenting shareholder resides if the corporation carries on business in that province.

(18) No security for costs — A dissenting shareholder is not required to give security for costs in an application made under subsection (15) or (16).

(19) Parties — On an application to a court under subsection (15) or (16),

(a) all dissenting shareholders whose shares have not been purchased by the corporation shall be joined as parties and are bound by the decision of the court; and

(b) the corporation shall notify each affected dissenting shareholder of the date, place and consequences of the application and of their right to appear and be heard in person or by counsel,

(20) Powers of court — On an application to a court under subsection (15) or (16), the court may determine whether any other person is a dissenting shareholder who should be joined as a party, and the court shall then fix a fair value for the shares of all dissenting shareholders.

(21) Appraisers — A court may in its discretion appoint one or more appraisers to assist the court to fix a fair value for the shares of the dissenting shareholders.

(22) Final order — The final order of a court shall be rendered against the corporation in favour of each dissenting shareholder and for the amount of the shares as fixed by the court.

(23) Interest — A court may in its discretion allow a reasonable rate of interest on the amount payable to each dissenting shareholder from the date the action approved by the resolution is effective until the date of payment.

(24) Notice that subsection (26) applies — If subsection (26) applies, the corporation shall, within ten days after the pronouncement of an order under subsection (22), notify each dissenting shareholder that it is unable lawfully to pay dissenting shareholders for their shares.

(25) Effect where subsection (26) applies — If subsection (26) applies, a dissenting shareholder, by written notice delivered to the corporation within thirty days after receiving a notice under subsection (24), may

(a) withdraw their notice of dissent, in which case the corporation is deemed to consent to the withdrawal and the shareholder is reinstated to their full rights as a shareholder; or

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(b) retain a status as a claimant against the corporation, to be paid as soon as the corporation is lawfully able to do so or, in a liquidation, to be ranked subordinate to the rights of creditors of the corporation but in priority to its shareholders.

(26) Limitation — A corporation shall not make a payment to a dissenting shareholder under this section if there are reasonable grounds for believing that

(a) the corporation is or would after the payment be unable to pay its liabilities as they become due; or

(b) the realizable value of the corporation’s assets would thereby be less than the aggregate of its liabilities.

Date post:	29-Sep-2020
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