GINDALBIE AND SUNDANCE ANNOUNCE PROPOSED MERGER TO CREATE A SIGNIFICANT NEW IRON ORE GROUP

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1 LEVEL 34, EXCHANGE PLAZA 2 THE ESPLANADE PERTH WA 6000 GPO BOX Z5189 PERTH WA 6831 TELEPHONE: FACSIMILE: info@sundanceresources.com.au A B N JOINT SECURITIES EXCHANGE ANNOUNCEMENT & MEDIA RELEASE 24 September 2007 GINDALBIE AND SUNDANCE ANNOUNCE PROPOSED MERGER TO CREATE A SIGNIFICANT NEW IRON ORE GROUP Iron ore companies Gindalbie Metals Ltd (ASX: GBG Gindalbie ) and Sundance Resources Limited (ASX: SDL Sundance ) today announced that they have reached agreement to merge to create a substantial A$2.4 billion international iron ore company. The companies have executed a Merger Implementation Agreement ( MIA ) to effect the merger by way of a Scheme of Arrangement ( Scheme ) under which Gindalbie will make offers to acquire all of the issued securities in Sundance. The proposed merger will result in the establishment of a major independent Australian-based iron ore company with a diversified asset base comprising world-class iron ore projects in Western Australia and West Africa, a very significant production growth profile and a global presence. Details of the Agreement and Offer Under the terms of the proposed Scheme of Arrangement, Sundance shareholders will receive one (1) Gindalbie share for every two (2) Sundance shares they hold. Based on the closing price of Gindalbie shares on 21 September 2007 of $1.70, the offer values Sundance at approximately A$1.6 billion and represents a premium of 14.9% on the closing price of Sundance shares on 21 September 2007 of 74 cents, and a 34.5% premium to the 30-day volume weighted average price (VWAP) of Sundance shares. On completion of the merger, the new entity would have approximately 1.43 billion shares on issue with an estimated market capitalization of approximately A$2.4 billion based on the closing price of Gindalbie shares on 21 September of $1.70. Gindalbie securityholders would hold approximately 35% and Sundance securityholders approximately 65% of the merged company. After careful consideration of the possible structures, an offer by Gindalbie for all of Sundance s issued securities by way of a Scheme was determined to be the most beneficial to securityholders of both companies. Mr Denis Wood representing Sundance s largest shareholder, Talbot Group Holdings (holding 19.9% of Sundance), has expressed the strong support of Talbot Group Holdings for the proposed merger and the successful completion of the respective Boards due diligence procedures. Mr George Jones, who is the Chairman and a shareholder of both Gindalbie and Sundance, has also expressed his full support for the transaction. Commenting on the merger proposal, Mr Jones said: "The proposed merger provides both groups of securityholders with the opportunity to participate in the creation of a new international mining house with a pipeline of worldclass projects. Because he is Chairman of both companies, Mr Jones excluded himself from each of the Board deliberations in relation to the proposed transaction. The Boards of both companies have implemented appropriate protocols relating to Mr Jones participation in Board and management discussions.

2 2 The Independent Directors of Sundance unanimously recommend that, in the absence of a superior proposal, all securityholders support the Scheme, on the basis of receipt of an Independent Expert s Report concluding that the Scheme is in the best interests of Sundance securityholders. Sundance Board members intend to vote in favour of the proposal in relation to their personal securityholdings in Sundance. The Scheme is subject to conditions including: satisfactory completion of detailed due diligence by the Boards of both companies; approval being received from the securityholders of Sundance and court approvals; all relevant regulatory approvals; and other conditions customary for a public transaction of this nature. The parties have agreed that, unless the MIA is terminated, neither Gindalbie nor Sundance will solicit any competing proposal or participate in any discussions or negotiations in relation to any competing proposal (unless failure to do so would involve a breach of the fiduciary duties of its Directors). The parties have agreed to the payment of a break-free of A$15 million by Sundance, equivalent to approximately 1% of the equity value of Sundance, which can be triggered by a number of events as set out in the MIA. The MIA is attached at Appendix A. Gindalbie is being advised on the transaction by Azure Capital as financial advisor and Clayton Utz as legal advisor, while Sundance is being advised by Capital Investment Partners as financial advisor and Blakiston & Crabb as legal advisor. The Combined Group The combined Gindalbie/Sundance group will have a market capitalization estimated at A$2.4 billion, a strong balance sheet with cash reserves of approximately $126 million (net of transaction costs), no debt, and a substantial asset base comprising a magnetite Resource (Indicated and Inferred) of 1.43 billion tonnes at 36.3% Fe, a magnetite Reserve (Probable) of 497 million tonnes at 36.3% Fe, and a hematite Resource (Indicated and Inferred) of 27.1 million tonnes at 61.7% Fe. The Mbalam Project in Cameroon contains substantial additional hematite mineralisation grading > 60% Fe which is currently the subject of prefeasibility study. The Company will have world-class development projects located in Western Australia s Mid West region and the Republic of Cameroon, West Africa, with key assets including: a 90% interest in the Mbalam Iron Ore Project in Cameroon, which is currently subject to a pre-feasibility study and major resource drilling program aiming to establish a large-scale direct shipping ore hematite project; a 50% interest in the Karara Magnetite Project (in joint venture with leading Chinese iron ore and steel group Ansteel) in Western Australia s Mid West region, which is scheduled to commence production in 2010 at an initial rate of 8Mtpa of magnetite concentrate, including a Joint Venture Pellet Plant to be located in north-eastern China; a 50% interest in the Mungada Hematite Project (also in joint venture with Ansteel) in Western Australia s Mid West region, which is scheduled to commence production in 2009 at an initial rate of 2Mtpa of direct shipping ore; extensive and high-quality exploration prospects within Exploration Permit No. 92 in Cameroon, comprising a 937km 2 area within which more than 35km of prospective iron formation has been outlined; and extensive and high-quality exploration holdings in Western Australia s Mid West region, including a tenement portfolio covering 1,900km 2 within which numerous priority hematite and magnetite exploration targets have been defined. The merged entity expects to become a substantial iron ore developer/producer on a world-scale, with a potential combined production level of more than 60 Mtpa of hematite, magnetite concentrate and blast furnace quality pellets by the middle of the next decade.

3 Rationale and Benefits 3 The Directors of Gindalbie and Sundance believe that the merger, if successful, has the potential to unlock significant synergies and a greatly increased range of growth opportunities. The merger would bring together two companies with a common philosophy, a strong investor base of international and Australian securityholders, quality joint venture partners, highly credentialed management teams and strong growth vision. Key benefits of the merger include: diversification of product and future earnings streams, with exposure to a range of iron products; staged delivery of world-class hematite and magnetite production; increased market capitalization, placing the new company in line to be included in the benchmark S&P ASX 200 index, attracting an increased level of Australian and international institutional and investor interest; exposure to a range of iron ore markets (Asia and Europe) and therefore a more diversified customer base; the ability to leverage the complementary experience, technical skills and marketing expertise of the respective management teams of the two companies; diversification of development and geographic risk; strong cash reserves of approximately $126 million (net of transaction costs); improved ability to access capital markets and raise both debt and equity finance; and enhanced ability to attract and retain highly skilled staff by accessing a global talent pool. Board and Management Structure Because of the scale of the projects being pursued by both Companies, it is envisaged that both existing management and operational teams will remain in place and continue their focus on the development of the respective assets during the merger process, with the combined team to be expanded as the projects are developed. The composition of the Board of the merged company is yet to be finalised, however it is envisaged that Mr George Jones, who has extensive international experience in the iron ore sector, will be appointed as Chairman of the merged entity, with both Mr Garret Dixon (Managing Director Gindalbie) and Mr Don Lewis (Managing Director Sundance) being nominated to the Board. The composition of the rest of the Board will be determined based on the skills and qualifications of the various candidates. Indicative Timetable Securityholders of Sundance will be asked to approve the Scheme of Arrangement at meetings which are expected to be held by February Full particulars of the Scheme, transaction terms and recommendations will be provided to securityholders though an Explanatory Booklet which will include an Independent Expert s Report in relation to the offer. It is expected that this booklet will be mailed to securityholders in December Gindalbie and Sundance securityholders are not required to take any action at this stage in relation to the Scheme of Arrangement. Management Comments Commenting on the merger proposal, Gindalbie s Managing Director, Mr Garret Dixon, said: This represents a unique opportunity to bring together two companies pursuing the development of world-class iron ore projects in different parts of the world. Gindalbie s world-class Karara Magnetite Project in WA, for which we recently signed a Joint Venture Development Agreement, complements the large-scale Mbalam hematite project being explored and developed by Sundance in Cameroon. The combined entity will be able to leverage off the benefits of creating a larger group with the depth of expertise and skills, funding ability, scale of operation and market capitalization to make a significant impact in the global iron ore industry, Mr Dixon added. In addition, we see the opportunity to unlock many synergies in the development of our respective projects, which will ultimately benefit both projects. The recent successful completion of Bankable Feasibility Studies for our Karara and Mungada Projects now provides a strong platform upon which we can pursue corporate opportunities like Sundance. Sundance s Managing Director, Mr Don Lewis, said: The proposed merger has the potential to deliver significant benefits to securityholders in both companies, giving them exposure to a merged company which would be a significant player on the international stage and which would have a world-class resource and asset base spanning two exciting, rapidly emerging iron ore provinces.

4 4 Sundance s Mbalam Project is located within a growing, new iron ore province in West Africa, while Gindalbie controls a significant and high-quality asset base in the Mid West iron ore province of Western Australia, Mr Lewis added. Gindalbie s strong production growth profile has the potential to complement and significantly enhance Sundance s development strategy with Gindalbie s hematite and magnetite projects scheduled to commence production in 2009 and 2010 respectively. This will provide a staged production growth profile for the merged group ahead of the proposed start-up of the Mbalam Project in ENDS Enquiries: Garret Dixon Michael Minosora Managing Director Managing Director Gindalbie Metals Ltd Azure Capital Pty Ltd Telephone: (+61-8) Telephone: (+61-8) Don Lewis Adam Rankine-Wilson Managing Director Executive Chairman Sundance Resources Limited Capital Investment Partners Ltd Telephone: (+61-8) Telephone: (+61-8) Media Enquiries: Nicholas Read Read Corporate Telephone: (+61-8) Competent Person Compliance Statements The information in the report that relates to the Karara Magnetite Mineral Resource is based on information compiled by Alex Virisheff, who is a Member of The Australasian Institute of Mining and Metallurgy. Alex Virisheff is employed by RSG Global. Alex Virisheff has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which he is undertaking to qualify as a Competent Person as defined in the 2004 Edition of the Australasian Code for Reporting of Mineral Resources and Reserves. Alex Virisheff consents to the inclusion in the report of the matters based on their information in the form and context in which it appears. The information in the report to that relates to the Mungada Hematite Mineral Resource is based on information compiled by Felicity Hughes and Andrew Munckton who are Members of the Australasian Institute of Mining and Metallurgy. Andrew Munckton is employed by Gindalbie Metals Ltd. Felicity Hughes is an independent Geological Consultant. Felicity Hughes and Andrew Munckton have sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which they are undertaking to qualify as Competent Persons as defined in the 2004 Edition of the Australasian Code for Reporting of Mineral Resources and Reserves. Felicity Hughes and Andrew Munckton consent to the inclusion in the report of the matters based on their information in the form and context in which it appears.

5 5 OTHER INFORMATION About Gindalbie Metals Ltd Listed on the Australian Securities Exchange since 1994, Gindalbie Metals Ltd is an emerging Australian iron ore company based in Perth, Western Australia. Gindalbie is developing a strategic portfolio of high-quality production and exploration assets located some 225km east of the port of Geraldton which will underpin its vision to become a leading independent supplier of iron ore products to world markets over the next decade. The initial focus of Gindalbie s growth strategy is the Mungada Hematite and Karara Magnetite Projects, however its longer term growth will be propelled by the exploration and development of its extensive 1,900 sq km tenement portfolio in the Mid West region, which includes numerous prospective magnetite and hematite exploration targets expected to deliver a long-term pipeline of growth opportunities. Gindalbie recently completed positive Bankable Feasibility Studies on both projects and signed a Joint Venture Development Agreement with its 50% joint venture partner, Chinese steel and iron ore group Ansteel, to proceed with their development. The Karara Magnetite Project is scheduled to commence production at an initial rate of 8Mtpa of high-grade magnetite concentrate in 2010, based on the large-scale Karara magnetite resource (currently 1.43 billion tonnes at 36.3% Fe). The Mungada Hematite Project is scheduled to commence shipments at an initial rate of 2Mtpa in the first quarter of 2009, based on an initial resource of 27.1 million tonnes at 61.7% Fe. About Sundance Resources Ltd Sundance Resources Ltd is an Australian company focused on mining interests in the Republic of Cameroon, on the central west coast of Africa. Sundance has commenced a pre-feasibility study on its 90%-owned Mbalam Iron Ore Project in Cameroon as the basis for a substantial international iron ore business. Central West Africa is considered to have the potential to develop into a significant new iron ore province, underpinned by the Mbalam Iron Ore Project and nearby US$3 billion Belinga Project in Gabon, currently under development by the China National Machinery and Equipment Import and Export Corporation. The Mbalam Iron Ore Project is estimated to contain iron mineralisation in excess of 800 million tonnes, including 218 million tonnes hematite grading +60% Fe within the Mbarga and Metzimevin Prospects. Aeromagnetic survey work by Sundance has identified more than 35km of prospective iron formation in the Mbalam region, underpinning Sundance s commitment to the project. WA-based Sundance has been listed on the Australian Securities Exchange since 1993 and is also listed on over-thecounter markets in Frankfurt, Berlin, Hamburg, Stuttgart and Munich.

6 Appendix A Merger Implementation Agreement 6

7 Merger Implementation Agreement Gindalbie Metals Limited ABN Sundance Resources Limited ABN The Clayton Utz contacts for this document are Mark Paganin and Matthew Johnson on Clayton Utz Lawyers QV St George's Terrace Perth WA 6000 Australia GPO Box P1214 Perth WA 6844 T F Our reference 60018/15133/

8 Table of contents 1. Definitions and interpretation Definitions Interpretation Sundance Scheme Scheme Scheme Consideration No amendments to the Scheme without consent Conditions Obligations not binding until Conditions satisfied Conditions Regulatory Approval Conditions Benefit of a Condition Waiver of a Condition Fulfilment of each Condition When a Condition is fulfilled If a Condition is not fulfilled or waived Co-operation Scheme Booklet and Court Documents Advertising and Communications Regulatory and contractual approvals Recommended Scheme Conduct of Court proceedings Conduct of business before Implementation Date Conduct of business in ordinary course Sundance Obligations Gindalbie Obligations Access to Information Sundance to give access to information Gindalbie to give access to information Sundance and Gindalbie to give information on representations and warranties Due diligence Gindalbie Due Diligence Investigations Sundance Business and assets Sundance Due Diligence Investigations Gindalbie Business and assets Availability of information Interviews No solicitation No solicitation Notification of Takeover Proposal Undertaking i

9 11.1 Undertaking to reimburse fees, costs, losses and expenses Compliance with law Directors' duties Announcement No Announcement Notice of Announcement Termination When a party may terminate Obligations on termination Representations and warranties Mutual representations and warranties Sundance representations and warranties Gindalbie representations and warranties Reliance on representations and warranties When warranties are given Indemnities Indemnities by Sundance Indemnities by Gindalbie Release Preparation for conduct of business after Implementation Date Assist with integration Integration committee Role of integration committee Access for purpose of integration GST GST payable in addition to consideration for taxable supplies Tax Invoice Consideration exclusive of GST Notices How to give a notice When a notice is given Address for notices Amendment and Assignment Amendment Assignment General Governing law Liability for expenses Giving effect to this document Waiver of rights No partnership or agency Operation of this document Operation of indemnities Consents ii

10 22.9 No merger Inconsistency with other documents Counterparts Attorneys Schedule 1 Deed Poll Schedule 2 Sundance's Capital Schedule 3 Gindalbie's Capital iii

11 This Merger Implementation Agreement is made on 24 September 2007 Parties Recitals The parties agree Gindalbie Metals Limited ABN of Level 9, 216 St Georges Terrace, Perth, Western Australia ("Gindalbie") Sundance Resources Limited ABN of Level 34, 2 The Esplanade, Perth, Western Australia ("Sundance") A. Gindalbie and Sundance are listed on the official list of ASX. B. The directors of Gindalbie have resolved to propose to Sundance Shareholders and Sundance Optionholders a restructure of Sundance by way of the Scheme under Part 5.1 of the Corporations Act, the effect of which will be to make Sundance a wholly owned subsidiary of Gindalbie. For this purpose, the Scheme has been proposed. C. The parties consider that it is to their respective advantages that the Scheme be implemented and accordingly the parties have agreed to enter into this Agreement to record and confirm the terms and conditions upon which they will co-operate and assist each other to that end. D. Implementation of the Scheme is subject to the conditions referred to in clause 3 of this Agreement. 1. Definitions and interpretation 1.1 Definitions In this Agreement, unless the context otherwise requires, the following words and expressions have meanings as follows: "Agreement" means this document. "Announcement" means a press release, announcement or other public statement other than an explanatory statement or supplementary explanatory statement required by the Corporations Act. "ASIC" means the Australian Securities and Investments Commission. "ASX" means ASX Limited ABN or the stock market operated by it as the context requires. "Authorisation" means: an approval, authorisation, consent, declaration, exemption, licence, notarisation, permit or waiver, however it is described, including any renewal or amendment and any condition attaching to it, from or by a Government Agency; and in relation to anything that could be prohibited or restricted by law, if a Government Agency acts in any way within a specified period, the expiry of that period without that action being taken. 1

12 "Business Day" means a day (other than a Saturday, Sunday or public holiday) on which banks are open for general banking business in Perth. "Claim" means a claim, action, proceeding or demand made against the person concerned, however it arises and whether it is present or future, fixed or unascertained, actual or contingent. "Communications" has the meaning given in clause 4.2. "Condition" means a condition precedent in clause 3.2. "Corporations Act" means the Corporations Act 2001 (Cth). "Court" means the Supreme Court of Western Australia or the Federal Court of Australia. "Cut-off Date" means 5.00 pm, 26 October 2007 or such later date as Gindalbie and Sundance agree. "Deed Poll" means a document in substantially the same form of Schedule 1. "DSO" means DSO Ventures Pty Ltd ACN "Effective" when used in relation to the Scheme, means the coming into effect, pursuant to section 411(10) of the Corporations Act, of the order of the Court made under sections 411(4) and 411(6) of the Corporations Act in relation to the Scheme. "Effective Date" means the date on which an office copy of the order of the Court approving the Scheme under section 411(4) of the Corporations Act is lodged with ASIC. "First Court Date" means the first day of the hearing of the Court of an application for an order under section 411(1) of the Corporations Act convening of the Scheme Meetings. "Gindalbie Business" means the business carried on by Gindalbie as at the date of this document. "Gindalbie Disclosure Material" means: the Gindalbie Due Diligence Information; and information available on the Public Registers on or before the Cut-off Date. "Gindalbie Due Diligence Information" means all written information relating to the business, assets, liabilities, operations, profits and losses, financial position and performance and prospects of Gindalbie provided by Gindalbie to Sundance. "Gindalbie Due Diligence Investigations" means the due diligence investigations conducted by Gindalbie commencing on 24 September 2007 and concluding on 26 October 2007 unless otherwise extended by agreement between Gindalbie and Sundance in relation to the Sundance Business and assets and as referred to in clause 9.1. "Gindalbie Material" means the information provided by Gindalbie to Sundance in accordance with clauses 4.1 and 7 for inclusion in the Scheme Booklet, other than information (if any) for which Gindalbie disclaims responsibility under clause 6. "Gindalbie Material Adverse Change" means a change, effect, occurrence or state of facts (or any development, occurrence or state of facts involving a prospective change) which has had or is likely to have an adverse financial effect on the consolidated net assets of Gindalbie and its subsidiaries of $50 million or more excluding any impact of merger related costs. 2

13 "Gindalbie Option" means an option to subscribe for a Gindalbie Share. "Gindalbie Prescribed Occurrence" means, except as required by this Agreement or the Scheme, or as publicly announced by Gindalbie prior to the date of this Agreement, any of the following occurring without the prior written consent of Sundance: (d) (Convert shares): Gindalbie converts all or any of the Gindalbie Shares into a larger or smaller number of Gindalbie Shares; (Reduce share capital): Gindalbie or a subsidiary of Gindalbie resolves to reduce its share capital in any way or reclassifying, combining, splitting or redeeming or repurchasing directly or indirectly any of its shares; (Buy-back) Gindalbie or a subsidiary of Gindalbie may not enter into a buy-back agreement however, Gindalbie is permitted to seek a resolution of Gindalbie Shareholders to approve the terms of a buy-back under section 257C(1) or 257D(1) of the Corporations Act; (Issue shares or options): Gindalbie or a subsidiary of Gindalbie issues shares or grants options over its shares, or agrees to make such an issue or grant such options, excluding (iii) any Gindalbie Shares issued by Gindalbie as a result of the exercise of existing Gindalbie Options or existing securities or other instruments convertible into Gindalbie shares; any issue of Gindalbie Options which Gindalbie is required to make under the terms of an agreement entered into prior to the date of this agreement; and any issue of Gindalbie Shares or Gindalbie Options approved or made pursuant to the resolutions to be proposed at the general meeting of Gindalbie Shareholders scheduled to take place on 26 September 2007; (e) (f) (g) (h) (Issue convertible securities): Gindalbie or a subsidiary of Gindalbie issues, or agrees to issue, securities or other instruments convertible into shares other than to assist in financing the Karara Iron Ore Projects as contemplated by the recently completed bankable feasibility studies; (Declare dividend): Gindalbie declares any dividend or pays, makes or incurs any liability to pay or make any distribution whether by way of dividend, capital distribution, bonus or other share of its profits or assets; (Create mortgage): Gindalbie or a subsidiary of Gindalbie creating, or agreeing to create, any mortgage, charge, lien or other encumbrance over the whole or a substantial part of the business or property of Gindalbie other than as a result of financing the Karara Iron Ore Projects as contemplated by the recently completed bankable feasibility studies; (Insolvency Event): an Insolvency Event occurring in relation to Gindalbie or a subsidiary of Gindalbie; (Change to constitution): Gindalbie makes any material change or amendment to its constitution; 3

14 (j) (k) (l) (m) (Litigation): proceedings brought against Gindalbie or a subsidiary of Gindalbie which are likely to result in damages or compensation payable by Gindalbie or a subsidiary of Gindalbie that would constitute a Gindalbie Material Adverse Change and which are not recoverable under any insurance arrangements; (Change to accounting practice or policies): Gindalbie making any change to its accounting practices or policies, other than to comply with generally accepted Australian accounting standards and any domestically accepted international accounting standards or electing to form a consolidated group for the purposes of the Income Tax Assessment Act 1997 (Cth); (Long term contract): Gindalbie or any subsidiary enters into any long term contract or commitment in excess of $5,000,000 that was not contemplated by the recently completed bankable feasibility studies on the Karara Iron Ore Projects; (General entitlements): Gindalbie or any subsidiary of Gindalbie without the consent of Sundance which consent shall not be unreasonably withheld: (iii) pays any substantial bonus to, or substantially increases the compensation of, any executive officer, director or employees of Gindalbie or any subsidiary of Gindalbie, other than remuneration adjustments to executives as a consequence of annual performance and remuneration reviews or an annual review of fees for non-executive directors; or grants to any employee of Gindalbie or any subsidiary of Gindalbie (other than an executive officer or director of Gindalbie) or any subsidiary of Gindalbie any increase of severance or termination pay or superannuation entitlements; establishes, adopts, enters into or amends in any material respect (including by taking any action to accelerate any rights or benefits due under), any enterprise bargaining agreement, Australian workplace agreement, employee benefit plan or superannuation scheme of Gindalbie or relating to the employees of Gindalbie (other than any executive officer or Director of Gindalbie); (n) (o) (p) (Executive Entitlements): Gindalbie grants to any executive officer or director of Gindalbie an increase in severance or termination pay or superannuation entitlements or establishes, adopts, enters into or amends in any material respect (including by taking any action to accelerate any rights or benefits due under) any employee benefit plan or superannuation scheme of Gindalbie or relating to the executive officers or directors of Gindalbie other than as agreed in writing between the parties; (Capital expenditure): Gindalbie or any subsidiary of Gindalbie makes capital expenditure in excess of $3,000,000 that was not contemplated by the recently completed bankable feasibility studies on the Karara Iron Ore Projects; (Acquisitions and Disposals): Gindalbie or any subsidiary of Gindalbie: (iii) acquires, leases or disposes of; agrees to acquire, lease or dispose of; or offers, proposes, announces a bid or tenders for, 4

15 any business, assets, entity or undertaking other than in the ordinary course of business, provided that Gindalbie may not without the prior written consent of Sundance take any of the actions described above in the ordinary course of business if taking such action would result in a Gindalbie Material Adverse Change; (q) (Material Contracts): Gindalbie or any subsidiary of Gindalbie: (iii) changes the terms of any Material Contract; pays, discharges or satisfies any claims, liabilities or obligations under any Material Contract other than the payment, discharge or satisfaction consistent with past practice and in accordance with their terms; or waives any material rights under or waives the benefit of any provisions of any Material Contract, other than in the ordinary course of business, provided that Gindalbie may not without the prior written consent of Sundance take any of the actions described above in the ordinary course of business if taking such action would result in a Gindalbie Material Adverse Change. "Gindalbie Share" means each fully paid ordinary share in Gindalbie. "Gindalbie Shareholder" means a holder of fully paid ordinary share in Gindalbie. "Government Agency" means a government, government department or a governmental, semigovernmental, administrative, statutory or judicial entity, agency, authority, commission, department, tribunal, or person charged with the administration of a law or agency, whether in Australia, Cameroon or elsewhere, including ASIC, the Takeovers Panel, and any self-regulatory organisation established under statute or by ASX. "GST" means the same as in the GST Law. "GST Law" means the same as "GST law" means in A New Tax System (Goods and Services Tax) Act 1999 (Cth). "Implementation" means the implementation of the Scheme upon it becoming Effective. "Implementation Date" means the third Business Day after the Record Date. "Independent Expert's Report" means the independent expert's report by an expert who is not an associate of Sundance or Gindalbie, stating whether or not in his or her opinion, the Scheme is in the best interests of the Sundance Shareholders and Sundance Optionholders, and setting out his or her reasons for that opinion. "Insolvency Event" means, for a party, being in liquidation or provisional liquidation or under administration, having a controller or analogous person appointed to it or any of its property, being taken under section 459F(1) of the Corporations Act to have failed to comply with a statutory demand, being unable to pay its debts or otherwise insolvent, ceasing to be of full legal capacity or otherwise becoming incapable of managing its own affairs for any reason, becoming an insolvent under administration (as defined in section 9 of the Corporations Act), entering into a compromise or arrangement with, or assignment for the benefit of, any of its Shareholders (other than the Scheme) or creditors or any analogous event. "Karara" means Karara Mining Limited ACN

16 "Karara Iron Ore Projects" means the Karara Magnetite Project and the Mungada Hematite Project. "Karara Magnetite Project" means the project for the extraction of magnetite from the Karara and DSO mining tenements and for the processing, transport and commercial sale of magnetite concentrate and pellets and associated activities. "Listing Rule" means a listing rule of ASX. "Loss" means a damage, loss, cost, expense or liability incurred by the person concerned, however it arises and whether it is present or future, fixed or unascertained, actual or contingent, but excluding liability for any consequential or indirect losses, economic losses or loss of profits. "Material Contracts" means any contract which is or may reasonably be expected to be material to the assets, liabilities, financial position, profits, losses or operation of the entity which is a party to it. "Mungada Hematite Project" means the project for the extraction of hematite from the Karara and DSO mining tenements and for the processing, transport and commercial sale of such ore and associated activities. "Public Registers" means the records made available for public inspection by ASIC, ASX and any other relevant public registers. "Record Date" means the day which is 2 Business Days after the Effective Date, or any other date agreed by the parties to be the record date to determine entitlements to receive Scheme Consideration. "Register" means the register of Sundance Optionholders and Sundance Shareholders. "Regulatory Approvals" means the consents, approvals, clearances, decisions, determinations or other acts by a Government Agency necessary to effect Implementation, including: the conditions set out in clauses 3.2 and 3.2(j); and all other approvals of a Government Agency, which Sundance and Gindalbie agree are necessary for Implementation. "Relevant Date" means, in relation to a Condition, the date or time specified in this document for its fulfilment or, if no date or time is specified, 8.00 am on the Second Court Date, subject, in either case, to extension under clause 3.8. "Scheme" means a scheme or schemes of arrangement under Part 5.1 between Sundance and the Sundance Shareholders, and between Sundance and the Sundance Optionholders to give effect to the terms of this document and in a form acceptable to Sundance and Gindalbie and includes any alterations or conditions made with the approval or at the discretion of the Court which are consented to by Gindalbie (acting reasonably) and which are acceptable to Sundance (acting reasonably) and as described in clause 2.1. "Scheme Booklet" means the information memorandum in respect of the Scheme to be approved by the Court and dispatched to Sundance Shareholders and Sundance Optionholders, and includes the Scheme, the Deed Poll, an explanatory statement complying with the requirements of the Corporations Act and the Corporations Regulations, the Independent Expert's Report and relevant notices of meeting and proxy forms. "Scheme Consideration" has the meaning given in clause

17 "Scheme Meetings" means the meetings of Sundance Shareholders and Sundance Optionholders, to be convened by the Court, to consider the Scheme. "Scheme Participants" means each Sundance Shareholder and Sundance Optionholder, as at 5.00 pm on the Record Date (taking into account registration of all registrable transfers and transmission applications received at Sundance's Shareholder registry by the Record Date). "Second Court Date" means the last day on which the Court hears the application for an order under section 411(4) of the Corporations Act approving the Scheme or, if the application is adjourned or subject to appeal for any reason, the last day on which the adjourned or appealed application is heard. "Shares" means Sundance Shares or Gindalbie Shares, as the context requires. "Sundance Business" means the business carried on by Sundance as at the date of this document. "Sundance Disclosure Material" means: the Sundance Due Diligence Information; and information available on the Public Registers on or before the Cut-Off Date. "Sundance Due Diligence Information" means all written information relating to the business, assets, liabilities, operations, profits and losses, financial position and performance and prospects of Sundance provided by Sundance to Gindalbie. "Sundance Due Diligence Investigations" means the due diligence investigations conducted by Sundance commencing on 24 September 2007 and concluding on 26 October 2007 unless otherwise extended by agreement between Gindalbie and Sundance in relation to the Gindalbie Business and assets and as referred to in clause 9.2. "Sundance Material Adverse Change" means a change, effect, occurrence or state of facts (or any development, occurrence or state of facts involving a prospective change) which has had or is likely to have an adverse financial effect on the consolidated net assets of Sundance and its subsidiaries of $50,000,000 or more excluding any impact of merger related costs. "Sundance Options" means an option to subscribe for a Sundance Share. "Sundance Optionholder Approval" means a resolution in favour of the Scheme passed by the required majority of Sundance Optionholders (being for those Sundance Options that are not required to be cancelled) under section 411(4) of the Corporations Act. "Sundance Optionholders" means each person entered in the Register as a holder of Sundance Options. "Sundance Prescribed Occurrence" means, except as required by this Agreement or the Scheme, or as publicly announced by Sundance prior to the date of this Agreement, any of the following occurring, without the prior written consent of Gindalbie: (Convert shares): Sundance converts all or any of its Shares into a larger or smaller number of Shares; (Reduce share capital): Sundance or a subsidiary of Sundance resolves to reduce its share capital in any way or reclassifying, combining, splitting or redeeming or repurchasing directly or indirectly any of its shares; 7

18 (Buy-back): Sundance or a subsidiary of Sundance: enters into a buy-back agreement; or resolves to approve the terms of a buy-back agreement under section 257C(1) or 257D(1) the Corporations Act; (d) (Issue shares or options): otherwise than as disclosed in writing to Gindalbie prior to the date of this Agreement, Sundance or a subsidiary of Sundance issues shares or grants an option over its shares, or agrees to make such an issue or grant such an option, excluding: (iii) any issue or grant contemplated by the Scheme; and any Sundance Shares issued by Sundance as a result of the exercise of existing Sundance Options or existing securities or other instruments convertible into Sundance shares; and any issue of Sundance Options which Sundance is required to make under the terms of an agreement entered into prior to the date of this agreement; (e) (f) (g) (h) (j) (k) (l) (m) (Issue convertible securities): Sundance or a subsidiary of Sundance issues, or agrees to issue, securities or other instruments convertible into shares; (Declare dividend): Sundance declares any dividend or pays, makes or incurs any liability to pay or make any distribution whether by way of dividend, capital distribution, bonus or other share of its profits or assets; (Create mortgage): Sundance or a subsidiary of Sundance creating, or agreeing to create, any mortgage, charge, lien or other encumbrance over the whole or a substantial part of the Business or property of Sundance; (Insolvency Event): an Insolvency Event occurring in relation to Sundance or a subsidiary of Sundance; (Change to constitution): Sundance makes any material change or amendment to its constitution (excluding any changes relating to the Scheme or as otherwise approved by Gindalbie which approval shall not be unreasonably withheld ); (Litigation): other than as disclosed in writing to each other prior to the date of this Agreement, proceedings brought against Sundance or a subsidiary of Sundance which are likely to result in damages or compensation payable by Sundance or a subsidiary of Sundance which constitutes a Sundance Material Adverse Change and which are not recoverable under any insurance arrangements; (Change to accounting practice or policies): Sundance making any change to its accounting practices or policies, other than to comply with generally accepted Australian accounting standards and any domestically accepted international accounting standards or electing to form a consolidated group for the purposes of the Income Tax Assessment Act 1997 (Cth); (Long term contract): Sundance or any subsidiary enters into any long term contract or commitment in excess of $5,000,000; (General entitlements): Sundance or any subsidiary of Sundance without the consent of Gindalbie which consent shall not be unreasonably withheld: 8

19 (iii) pays any bonus to, or increases the compensation of, any executive officer, director or employees of Sundance or any subsidiary of Sundance, other than cash bonuses or housing allowances to executives as a consequence of performance and remuneration reviews for the financial half-year ending 31 December 2006 or the financial year ending 30 June 2007; or grants to any employee of Sundance or any subsidiary of Sundance (other than an executive officer or director of Sundance) any increase of severance or termination pay or superannuation entitlements; establishes, adopts, enters into or amends in any material respect (including by taking any action to accelerate any rights or benefits due under), any enterprise bargaining agreement, Australian workplace agreement, employee benefit plan or superannuation scheme of Sundance or relating to the employees of Sundance (other than any executive officer or Director of Sundance); (n) (o) (p) (Executive Entitlements): Sundance grants to any executive officer or director of Sundance an increase in severance or termination pay or superannuation entitlements or establishes, adopts, enters into or amends in any material respect (including by taking any action to accelerate any rights or benefits due under) any employee benefit plan or superannuation scheme of Sundance or relating to the executive officers or directors of Sundance other than as agreed in writing between the parties; (Capital Expenditure): Sundance or any subsidiary of Sundance makes capital expenditure in excess of $3,000,000; (Acquisitions and Disposals): Sundance or any subsidiary of Sundance: (iii) acquires, leases or disposes of; agrees to acquire, lease or dispose of; or offers, proposes, announces a bid or tenders for, any business, assets, entity or undertaking other than in the ordinary course of business, provided that Sundance may not without the prior written consent of Gindalbie take any of the actions described above in the ordinary course of business if taking such action which would result in a Sundance Material Adverse Change; (q) (Material Contracts): Sundance or any subsidiary of Sundance: (iii) changes the terms of any Material Contract; pays, discharges or satisfies any claims, liabilities or obligations under any Material Contract other than the payment, discharge or satisfaction consistent with past practice and in accordance with their terms; or waives any material rights under or waives the benefit of any provisions of any Material Contract, other than in the ordinary course of business, provided that Sundance may not without the prior written consent of Gindalbie take any of the actions described above in the ordinary course of business if taking such action which would result in a Sundance Material Adverse Change; 9

20 "Sundance Shareholder" means a holder of a Sundance Share. "Sundance Shareholder Approval" means a resolution in favour of the Scheme passed by the required majority of Sundance Shareholders under section 411(4) of the Corporations Act. "Sundance Share" means a fully paid ordinary share in Sundance. "Sunset Date" means 31 March 2008, subject to any extension under clause 3.8. "Takeovers Panel" means the Takeovers Panel constituted under the Australian Securities and Investments Commission Act 2001 (Cth). "Takeover Proposal for Gindalbie" means in relation to Gindalbie and excluding the Scheme: any proposal for a takeover bid, scheme of arrangement, capital reconstruction, buyback, merger, amalgamation, consolidation, purchase of assets or other business combination involving the Gindalbie Business, Gindalbie or any of its subsidiaries; or any proposal for the acquisition of an economic interest in all or a substantial part of the Gindalbie Business, Gindalbie or any of its subsidiaries; or any proposal which could result in a person who does not already have voting power of 20% in Gindalbie, having voting power of more than 20% in Gindalbie. "Takeover Proposal for Sundance" means, in relation to Sundance and excluding the Scheme: any proposal for a takeover bid, scheme of arrangement, capital reconstruction, buyback, merger, amalgamation, consolidation, purchase of assets or other business combination involving the Sundance Business, Sundance or any of its subsidiaries; or any proposal for the acquisition of an economic interest in all or a substantial part of the Sundance Business, Sundance or any of its subsidiaries; or any proposal which could result in a person who does not already have voting power of 20% in Sundance, having voting power of more than 20% in Sundance. "Third Party Consent" means any consent, agreement, waiver, licence or approval from or by a party in respect of a contract involving Sundance or a subsidiary, which is agreed by the parties to this document, on or before the date of this document. "Third Party Proposal" means any expression of interest, offer or proposal by any person other than Gindalbie, to: (d) acquire (whether directly or indirectly) or become the holder (whether by share purchase, issue of shares, options or convertible notes, scheme, capital reconstruction, purchase of assets, takeover offer or otherwise) of, or otherwise acquire or have an economic interest in all or a substantial part of the Sundance Business, Sundance or any of its subsidiaries; acquire control (as determined in accordance with section 50AA of the Corporations Act) of Sundance or any of its subsidiaries; otherwise acquire or merge with Sundance (whether by way of joint venture, dual listed company structure or otherwise); or enter into any agreement, arrangement or understanding requiring it to abandon, or otherwise fail to proceed with, the Scheme. 10

21 1.2 Interpretation In this Agreement: headings are for convenience only and do not affect interpretation; and unless the context indicates a contrary intention: (d) (e) (f) (g) (h) (j) (k) (l) (m) (n) (o) an obligation or liability assumed by, or a right conferred on, 2 or more parties binds or benefits all of them jointly and each of them severally; the expression "person" includes an individual, the estate of an individual, a corporation, an authority, an association or a joint venture (whether incorporated or unincorporated), a partnership and a trust; a reference to any party includes that party's executors, administrators, successors and permitted assigns, including any person taking by way of novation and, in the case of a trustee, includes any substituted or additional trustee; a reference to any document (including this Agreement) is to that document as varied, novated, ratified or replaced from time to time; a reference to any statute or to any statutory provision includes any statutory modification or re-enactment of it or any statutory provision substituted for it, and all ordinances, by-laws, regulations, rules and statutory instruments (however described) issued under it; words importing the singular include the plural (and vice versa), and words indicating a gender include every other gender; references to parties, clauses, schedules, exhibits or annexures are references to parties, clauses, schedules, exhibits and annexures to or of this Agreement, and a reference to this Agreement includes any schedule, exhibit or annexure to this Agreement; where a word or phrase is given a defined meaning, any other part of speech or grammatical form of that word or phrase has a corresponding meaning; the word "includes" in any form is not a word of limitation; a reference to "$" or "dollar" is to Australian currency; references to payments to any party to this Agreement will be construed to include payments to another person upon the direction of such party; all payments to be made under this Agreement must be made by unendorsed bank cheque or other immediately available funds; if any day appointed or specified by this Agreement for the payment of any money or doing of any thing falls on a day which is not a Business Day, the day so appointed or specified shall be deemed to be the next Business Day; and terms defined in the Corporations Act shall bear the defined meaning where used in this Agreement. 11