Ann: SUBSTANTIAL UPGRADE TO PANDA HILL RESOURCE , page-6

re: Ann: SUBSTANTIAL UPGRADE TO PANDA HILL RE... Recent broker report mentions they need around $18m to do a DFS , considering they have less than $1m in bank where is the money coming from. Country risk and project costs in US dollars make borrowing money tough. They may need to partner with a Cashed up Tanzanian company to see this project through. Fully diluted value around 24m at 18c , It is a valuable deposit just needs funds to complete DFS and find someone to finance the project. Stock could rerate on any announcement regarding the DFS or Project funding.


http://www.cradleresources.com.au/_content/documents/CXX-20131127.pdf

Risks

Financing Risk: CXX may from time to time need to access the equity/debt markets to finance its exploration and development activities. There can be no assurances that this
capital will be available at a reasonable cost; therefore, substantial future dilution could result. Initial high level estimates suggest development of the Panda Hill project would cost >$200m and needs ~$18m to compete a DFS.


Country Risk: Changes in government policies, regulations, tax regimes and political unrest can negatively impact CXX’s asset and valuation. Tanzania ranks 74/96 in the Fraser
Institute mining survey (2012/2013), which is a significant fall from 44/72 in 2009/2010. In 2010, Tanzania changed its mining code and increased gold royalties to 4% (from 3%),
required the Government to own a stake in any mining project and requires mining companies to list on the Dar es Salaam stock exchange. The new mining code was brought about by large tax holidays and low royalties offered to the first large gold miners (eg; Barrick Gold), which were seen as not benefiting Tanzanians. The positive for CXX is the
Panda Hill project is on an approved mining license, which was granted under the old mining code.

Renewal of Title: Since granting of the Panda Hill Licences there have been previous delays in the development of the Panda Hill Project as a result of delays in agreeing terms
with the Tanzanian authorities for the relocation of the Songwe Prison. Following meetings with the Ministry of Mines officials in Tanzania, including the Minister for Mining, CXX does not believe that this will have consequences for renewal of the Panda Hill Licences. However, any application for renewal of any licence comprising the Panda Hill Project
involves the exercise of discretion by the relevant government authority. There is no assurance that such renewals will be given as a matter of course and there is no assurance that new conditions will not be imposed in connection with the renewal.

Metallurgical Risk: Metallurgical testwork from five bulk samples conducted in 2001 by Euromet suggested that fenite and oxide material yielded poor results using conventional
processing due to the refectory nature of that particular ore. It will be important to better map this material. There is some enrichment of other metals in the deposit including rare earth elements, phosphate and their concentration should be monitored. At high enough concentrations these could impact the processing of the material.

Commodity Risk: The Niobium market appears to be relatively stable and appears to have a strong growth profile. However, should the world economy continue to slow then steel
production may fall which could adversely impact Niobium demand.

Foreign Exchange Risk: The majority of CXX’s cash reserves are held in Australian dollars. Therefore, with the majority of costs in US dollars, there is currency risk should the
USD dollar strengthen, which could adversely affect the purchasing power of CXX’s cash.

Tenure: The three mining licences that host the Panda Hill Niobium project are due to expire on 15 November 2016 and will therefore require renewal. The renewal should be
straight forward, however, there are risks associated with this including changes to economic parameters which could be considered under the new mining code.

Exploration Risk: Exploration is inherently risky and there is no guarantee that an economic deposit will be delineated. Further drilling is needed to follow-up targets which
may or may not result in further discoveries.