NOTICE
OF
SPECIAL
MEETING
OF
SHAREHOLDERS
to
be
held
on
October
12,
2012
and
MANAGEMENT
INFORMATION
CIRCULAR
with
respect
to
a
proposed
Plan
of
Arrangement
involving
ENDEAVOUR
MINING
CORPORATION
and
AVION
GOLD
CORPORATION
September
10,
2012
The Board of Directors of Endeavour Mining Corporation unanimously support the proposed Arrangement and
recommend that Endeavour Shareholders vote in favour of the resolution approving the issuance of Endeavour
Shares in connection with the Arrangement
These materials are important and require your immediate attention. They require Endeavour's shareholders to
make important decisions. If you are in doubt as to how to make such decisions, please contact your professional
advisor. If you have questions or require assistance with voting your shares, you may contact Endeavour's proxy
solicitation agents:
The Laurel Hill Advisory Group, by email at [email protected] or by telephone at
1‐877‐304‐0211 (toll free within Canada or the U.S.) or
+1 (416) 304‐0211 (for collect calls outside of Canada and the U.S.)
Orient Capital Pty Ltd. in Australia by telephone at 1 800 882 147 or
outside of Australia by telephone at +61 2 8280 7924
Dear Endeavour Shareholder:
On August 7, 2012, Endeavour announced that it had entered into an arrangement agreement with Avion Gold Corporation (as amended and restated on September 5, 2012) to acquire Avion in an all‐stock transaction which will create one of the largest West African gold mining companies, having three producing mines, a fourth mine that is currently in construction and an attractive pipeline of exploration and development properties.
Endeavour has an established track record of successfully deploying its capital and expertise to acquire companies that have gold production and growth potential but who are experiencing financial stress that results in short‐term operational difficulties and leads to market value discounts. Through timely capital investments and a focused management approach, we have been able to significantly improve cash flow at our Youga and Nzema mines. We have also brought our Agbaou gold project through an optimized feasibility study and into mine construction.
We entered into the arrangement agreement with Avion because we believe Avion's market valuation did not reflect the intrinsic value of its underlying mining and development assets, and that Endeavour is well positioned to unlock this value. Avion's principal asset is the Tabakoto mine in Western Mali, which is experiencing financial difficulties associated with a mill capacity expansion project that was suspended when approximately 80% complete, due to contractor demobilization following the 2012 coup in Mali. Avion is a compelling acquisition opportunity that is both a good fit with our existing West African asset base and with Endeavour's skills and expertise. We expect that our financial strength combined with our regional and operational capabilities will unlock value from the Tabakoto mine. Following the acquisition Endeavour will move forward with an expanded platform for future growth with Avion's advanced stage development projects: Houndé (Burkina Faso) and Kofi (Mali). Endeavour will be positioned to become a leading, diversified mid‐tier gold producer with a superior growth profile.
Assuming the acquisition is completed, Endeavour will acquire all of the issued shares of Avion and each Avion shareholder and optionholder will be entitled to receive 0.365 ordinary shares or options of Endeavour for each Avion share or option they hold. This exchange ratio valued Avion at C$0.88 per share using closing prices on the TSX on August 7, 2012.
In reaching its decision to approve the acquisition, Endeavour's board of directors considered the positive results of the due diligence review conducted by Endeavour's management and its advisors, as well as the benefits of creating a combined entity with the following attributes:
Gold Production Growth. The acquisition will immediately increase Endeavour's 2012 forecast gold
production by approximately 50% to between 282,000 and 304,000 ounces, and including the Tabakoto mill expansion and completion of Agbaou construction, our gold production is forecast to reach approximately 450,000 ounces per year.
Unlocking Value at Tabakoto. To enable the rapid restart of the Tabakoto mill capacity expansion,
Endeavour provided a US$20 million short term exchangeable loan to Avion. This funding facilitates the re‐mobilization of contractors without further delay. The capacity upgrade is expected to increase Tabakoto production from current levels of 95,000 to 102,000 ounces per year to over 150,000 ounces per year.
Resource and Reserve Base. Endeavour's NI 43‐101 compliant attributable Proven and Probable
gold reserves will increase by 31% to 2.8 million ounces, Measured and Indicated gold resources
will increase by 52% to 6.0 million ounces, and Inferred gold resources will increase by 167% to 3.3 million ounces.1
Pipeline for West African Exploration and Development Growth. The acquisition will add a portfolio
of highly prospective exploration properties to Endeavour's existing West African land package, which will exceed 11,800km². Avion's Houndé project in Burkina Faso is progressing towards a Preliminary Economic Assessment which is anticipated by year end. Current resources are 893,000 indicated ounces and 712,000 inferred ounces. Avion's Kofi project in Western Mali currently hosts 500,000 indicated ounces and 702,000 inferred ounces. These properties are attractive additions to our growth profile that already includes the Nzema sulphides project in Ghana and the Ouaré deposit in Burkina Faso.
Improvements and Efficiency Gains. Endeavour has a track record of successfully optimizing assets
with timely capital investments and using the skills of its experienced operations and project development teams, which are led by an experienced and centralized senior operations team based in Accra, Ghana. Tabakoto is a complementary addition to Endeavour's West African operating platform.
Financial Strength. The new Endeavour is expected to have a strong financial profile, with pro
forma cash and cash equivalents of US$51 million (as of June 30, 2012 and net of the US$100 million drawn from the corporate loan facility), plus operating cashflow from three mines and access to a US$200 million revolving corporate loan facility to be used for general corporate purposes, capital expenditure and acquisitions. New Endeavour anticipates additional cash proceeds of up to approximately C$115 million from options and warrants having an exercise price of C$2.50 or less.
Enhanced Capital Markets Profile. With a combined market capitalization of approximately C$977
million (August 7, 2012 acquisition announcement date basis), Endeavour is emerging as a mid‐tier gold producer. Growing our annual gold production rate and expanding the pipeline of future development projects improves Endeavour's market visibility, and potentially attracts a wider group of investors as well as increasing our trading liquidity and broadening our analyst coverage. Through an all‐stock acquisition structure, Endeavour remains well funded to complete the Agbaou mine construction (gold production scheduled for Q1 2014), complete the Tabakoto mill expansion (increasing gold production during 2013), and fund its attractive pipeline of organic growth opportunities and exploration programs.
Following the acquisition, Endeavour shareholders will continue to hold their existing Endeavour ordinary shares and CDIs. Endeavour expects that an aggregate of up to approximately 161,889,122 new Endeavour shares will be issued in respect of the Avion shares outstanding as at September 10, 2012, representing 66.1% of Endeavour's 245,091,769 outstanding shares as at September 10, 2012 (on a non‐diluted basis). Endeavour expects that an aggregate of up to approximately 175,732,604 new Endeavour shares will be issued or issuable in respect of Avion shares and options outstanding as at September 10, 2012, representing 59.4% of the 295,642,283 outstanding Endeavour shares as at September 10, 2012 (on a fully‐ diluted basis). However, Endeavour is seeking approval for the issuance of up to 176,500,000 new Endeavour shares in connection with the acquisition, representing approximately 72% of the 245,091,769
1
Each category of reserves and resources is separately reported in the attached information circular on page 83 under the heading
"New Endeavour – Resources and Reserves".
Endeavour shares outstanding as at September 10, 2012. This is in order to provide Endeavour with the ability to complete the acquisition in the event that there is an immaterial increase in the number of Avion securities outstanding between the date of this letter and the date the acquisition becomes effective; it will additionally allow Endeavour to issue up to 431,156 new Endeavour shares with respect to Avion's payment obligations for certain exploration concessions that are or may become due after the acquisition becomes effective. Immediately following implementation of the acquisition (assuming no currently outstanding Endeavour or Avion options or Endeavour warrants are exercised), existing Endeavour shareholders will hold approximately 60.2% of the issued and outstanding Endeavour shares and former Avion shareholders will hold approximately 39.8% of the issued and outstanding Endeavour shares, based on the number of shares outstanding as of September 10, 2012.
The listing rules of the TSX generally require a listed corporation to obtain shareholder approval in connection with an acquisition where the number of securities issued or issuable in payment of the purchase price for the acquisition exceeds 25% of the number of securities of the listed issuer which are outstanding, on a non‐diluted basis, prior to the date of closing of the acquisition. Therefore, in order to become effective, the share issuance resolution must be approved by at least a majority of the votes cast by Endeavour shareholders (50% plus one vote), either present in person or by proxy at the special meeting. Endeavour has therefore called the special meeting of shareholders to consider a resolution to approve the issuance of up to 176,500,000 new Endeavour shares as consideration to be paid to Avion securityholders; this includes a sufficient number of shares to cover future exercises of Avion options which are being adjusted under the terms of the acquisition. The special meeting of Endeavour shareholders is being held on October 12, 2012, before the meeting of Avion securityholders which has been called to consider the acquisition.
AFTER CAREFUL CONSIDERATION OF THE ACQUISITION, THE ENDEAVOUR BOARD OF DIRECTORS HAS
UNANIMOUSLY RECOMMENDED THAT ENDEAVOUR SHAREHOLDERS VOTE IN FAVOUR OF THE SHARE
ISSUANCE RESOLUTION.
The information circular contains details concerning the acquisition together with detailed information concerning Endeavour and Avion and the resulting combined entity. Shareholders are urged to carefully review the information circular and accompanying materials as they contain important information regarding such matters.
The completion of the acquisition is subject to several conditions that must be satisfied or waived, including: Avion securityholder approval, Endeavour shareholder approval, obtaining court orders, and satisfaction of governmental or regulatory conditions including Investment Canada and TSX approvals. On August 27, 2012 Endeavour received confirmation from ASX that no formal approval or consent of ASX is necessary in connection with the acquisition. On September 10, 2012, Endeavour obtained the TSX's conditional approval to list up to 176,500,000 new Endeavour shares in connection with the acquisition subject only to the satisfaction of the customary listing conditions of the TSX. Assuming that all of the conditions to the acquisition are satisfied, Endeavour expects that the acquisition will become effective on or about October 18, 2012.
Endeavour shareholders are requested to complete and return the enclosed form of proxy to ensure that their Endeavour shares will be represented at the special meeting, whether or not they are personally able to attend.
If you have questions or require assistance with voting your shares, you may contact Endeavour's proxy solicitation agents: (a) The Laurel Hill Advisory Group, by email at [email protected] or by telephone at 1‐877‐304‐0211 (toll free within Canada or the U.S.) or +1 (416) 304‐0211 (for collect calls outside Canada and the U.S.); or (b) Orient Capital Pty Ltd. between 8:30 a.m. and 7:30 p.m. (Sydney time), Monday – Friday by telephone in Australia at 1 800 882‐147 or outside of Australia by telephone at +61 2 8280 7924. Thank you for your continued support of Endeavour. Sincerely, "Neil Woodyer" Neil Woodyer President & Chief Executive Officer
NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
NOTICE IS HEREBY GIVEN that a special meeting of shareholders (the "Meeting") of Endeavour Mining Corporation ("Endeavour") will be held at the Metropole Hotel, 4 Avenue de la Madone, BP 19, 98007 Monaco, on Friday, October 12, 2012, at 10:00 a.m. (Monaco time) to:
(1) consider and pass, with or without variation, an ordinary resolution, the full text of which is attached as Schedule "A" to the accompanying management information circular of Endeavour (the "Information Circular"), approving the issuance of up to a maximum of 176,500,000 Endeavour ordinary shares (the "New Endeavour Shares") to the holders of common shares ("Avion Shares") of Avion Gold Corporation ("Avion") and options to acquire Avion Shares, which includes the New Endeavour Shares issuable on exercise of the outstanding Avion options and the issuance of the New Endeavour Shares underlying any exchangeable shares issued to any holders of Avion Shares, in each case, in accordance with a court‐approved plan of arrangement (the "Arrangement") between Avion and its securityholders under the Business Corporations Act (Ontario) pursuant to which Avion will become a subsidiary of Endeavour in accordance with the amended and restated arrangement agreement dated September 5, 2012 between Endeavour, 0947263 B.C. Unlimited Liability Company, Endeavour Gold Corporation and Avion, all as more particularly set forth in the amended and restated arrangement agreement and described in the Information Circular; and (2) transact such other business as may properly come before the Meeting or any adjournment or
postponement thereof. This Notice is accompanied by the Information Circular, which provides additional information relating to the matters to be dealt with at the Meeting and forms part of this Notice of Meeting. The record date for the determination of the holders of Endeavour Shares that will be entitled to receive notice of and vote at the Meeting, and any adjournment or postponement of the Meeting has been fixed at the close of business (Vancouver time) on September 7, 2012.
If you are a registered Endeavour shareholder, you are requested to complete, sign, date and return the
enclosed form of proxy so that it will be received at the office of the registrar and transfer agent for the
Endeavour Shares by 10:00 a.m. (Monaco time) on Wednesday, October 10, 2012. Alternatively, you may
submit your vote via the internet at www.investorvote.com, by telephone at 1‐866‐732‐8683 (toll free in
North America) or +1 312‐588‐4290 (international), by facsimile to 1‐866‐249‐7775 (toll free in North
America) or +1 416‐263‐9524 (international), or by appointing another person to attend the Meeting and
vote your Endeavour Shares on your behalf. All proxies must be received by 10:00 a.m. (Monaco time)
on Wednesday, October 10, 2012 or not less than 48 hours before the commencement of any
adjournment or postponement of the Meeting. The deadline for the deposit of proxies may be waived
by the chairman of the Meeting at his sole discretion without notice. If you are not a registered
Endeavour shareholder, instead of a proxy you will find enclosed a voting instruction form – please see
"General Proxy Information – Execution and Revocation of Proxies – Beneficial (Non‐Registered)
Shareholders" on page 25 of the Information Circular for instructions on how to ensure you are
represented at the Meeting.
If you have questions or require assistance with voting your shares, you may contact Endeavour's proxy solicitation agents: (a) The Laurel Hill Advisory Group, by email at [email protected] or by telephone at 1‐877‐304‐0211 (toll free within Canada or the U.S.) or +1 (416) 304‐0211 (for collect calls outside Canada and the U.S.); or (b) Orient Capital Pty Ltd. between 8:30 a.m. and 7:30 p.m. (Sydney time), Monday – Friday by telephone in Australia at 1 800 882‐147 or outside of Australia by telephone at +61 2 8280 7924. DATED at George Town, Cayman Islands, as of September 10, 2012. By Order of the Board of Directors "Neil Woodyer" Neil Woodyer Director, President and Chief Executive Officer
SPECIAL MEETING OF SHAREHOLDERS CDI VOTING PROCESS
The special meeting (the "Meeting") of holders of ordinary shares ("Shares") in the capital of Endeavour Mining Corporation ("Endeavour") will be held at the Metropole Hotel, 4 Avenue de la Madone, BP 19, 98007 Monaco, on Friday, October 12, 2012 at 10:00 a.m. (Monaco time). The Meeting provides shareholders with an opportunity to participate directly in the affairs of Endeavour and to meet our directors and management. Please see the accompanying Notice of Special Meeting of Shareholders for further details.
As the ordinary shares of Endeavour are listed on the Australian Securities Exchange (the "ASX") in the form of CHESS Depositary Interests ("CDIs"), Endeavour would like to remind CDI holders of the particular requirements and restrictions that their votes will be subject to. Each CDI represents a beneficial interest in one ordinary share of Endeavour. CDI holders do not actually own direct legal title to ordinary shares, which are held for and on behalf of CDI holders by CHESS Depositary Nominees Pty Ltd. ("CDN"), a wholly‐ owned subsidiary of ASX Limited. This structure exists because Endeavour is a Cayman Islands exempted company with limited liability with a right to have its securities traded on the ASX by way of CDIs.
This structure impacts how CDI holders can record their votes for the matters to be tabled at the Meeting. As CDIs are technically rights to ordinary shares held on behalf of CDI holders by CDN, CDI holders need to provide confirmation of their voting intentions to CDN before the Meeting. CDN will then exercise the votes on behalf of CDI holders. If a CDI holder wishes to vote, they must register their vote with CDN by using the CDI Voting Instruction Form ("VIF") provided.
To have a CDI vote counted, CDI holders must return their completed VIF to CDN by no later than October 9, 2012, at 10:00 a.m. (WST). This deadline has been set to allow CDN sufficient time to collate the votes of CDI holders and submit them to Endeavour prior to the Meeting. Endeavour appreciates your support and encourages CDI holders to lodge their votes ahead of the Meeting in the manner specified above. If you have questions or require assistance with voting your Shares represented by CDIs, you may contact Endeavour's proxy solicitation agent, Orient Capital Pty Ltd., between 8:30 a.m. and 7:30 p.m. (Sydney time), Monday‐Friday by telephone in Australia at 1 800 882‐147 or outside of Australia by telephone at +61 2 8280 7924. DATED at George Town, Cayman Islands, as of September 10, 2012. By Order of the Board of Directors "Neil Woodyer" Neil Woodyer Director, President and Chief Executive Officer
TABLE OF CONTENTS NOTICE OF SPECIAL MEETING OF SHAREHOLDERS ... i SPECIAL MEETING OF SHAREHOLDERS CDI VOTING PROCESS ... iii NOTICE TO UNITED STATES SECURITYHOLDERS ... 1 STATEMENTS REGARDING FORWARD‐LOOKING INFORMATION... 2 INFORMATION CONCERNING AVION ... 3 REPORTING CURRENCIES AND ACCOUNTING PRINCIPLES ... 3 CURRENCY EXCHANGE RATE INFORMATION ... 4 Q & A ON THE ARRANGEMENT, VOTING RIGHTS AND SOLICITATION OF PROXIES ... 5 GLOSSARY OF TERMS ... 15 GENERAL PROXY INFORMATION ... 25 Solicitation of Proxies ... 25 Execution and Revocation of Proxies ... 25 Voting of Proxies and Exercise of Discretion ... 29 Quorum and Votes Necessary to Pass an Ordinary Resolution ... 30 Voting Shares and Principal Holders Thereof ... 30 BUSINESS OF THE MEETING ... 31 Record Date ... 32 Outstanding Shares ... 32 THE ARRANGEMENT ... 32 General ... 32 The Arrangement ... 33 Background to the Arrangement ... 34 Reasons for the Arrangement ... 37 Canaccord Fairness Opinion ... 39 Avion Voting Agreement ... 40 Endeavour Voting Agreement ... 41 Recommendation of the Board ... 42 Approvals ... 43 Issuance of New Endeavour Shares, New Avion Shares, Exchangeable Shares and Adjusted Options ... 45 STRUCTURE OF THE ARRANGEMENT ... 45 Description of the Structure of the Arrangement ... 45 Description of the Exchangeable Shares ... 45 Voting and Exchange Trust Agreement ... 54 Exchangeable Share Support Agreement ... 56 THE ARRANGEMENT AGREEMENT ... 57 Representations and Warranties ... 58 Obligations to Effect the Arrangement ... 60 Conduct of the Business of Avion and Endeavour Pending the Completion of the Arrangement ... 63 Avion Non‐Solicitation; Acquisition Proposals ... 66 Additional Covenants ... 69 Conditions to the Arrangement ... 70 Termination ... 73 Termination and Expense Fees ... 74 EXCHANGEABLE LOAN TO AVION ... 75 RISK FACTORS ... 76 Risks Relating to the Arrangement ... 76
Risks Relating to the Business of Endeavour ... 78 Risks Relating to Avion and New Endeavour ... 78 NEW ENDEAVOUR ... 80 Overview ... 80 Summary Organization Chart ... 82 Resources and Reserves ... 83 Directors and Officers... 85 Description of Share Capital ... 87 Exchangeable Shares ... 89 Description of Endeavour Warrants ... 89 Description of Endeavour Options ... 89 Selected Endeavour Unaudited Pro Forma Financial Information ... 90 Post‐Arrangement Shareholdings and Principal Shareholders ... 92 Consolidated Capitalization ... 92 Conflicts of Interest ... 93 Indebtedness of Directors and Officers... 93 Auditors ... 93 Registrar and Transfer Agent ... 93 Legal Proceedings ... 94 INFORMATION CONCERNING AVION ... 95 Documents Incorporated by Reference ... 95 General ... 97 Recent Developments ... 98 Trading Price and Volume ... 99 Prior Sales ... 100 INFORMATION CONCERNING ENDEAVOUR ... 100 Overview ... 100 Share Capital of Endeavour ... 101 Price Range and Trading Volumes of Endeavour Shares ... 102 Price Range and Trading Volumes of Endeavour A Warrants ... 102 Prior Sales ... 103 Consolidated Capitalization ... 103 Endeavour Documents Incorporated by Reference and Further Information... 104 INTEREST OF INFORMED PERSONS IN MATERIAL TRANSACTIONS ... 105 INTEREST OF CERTAIN PERSONS IN MATTERS TO BE ACTED UPON ... 105 AUDITOR ... 106 EXPERTS OF ENDEAVOUR AND AVION ... 106 Endeavour ... 106 Avion ... 107 ADDITIONAL INFORMATION ... 107 DIRECTORS' APPROVAL... 108 CONSENTS ... 109 SCHEDULES SCHEDULE "A" SHARE ISSUANCE RESOLUTION ... A‐1 SCHEDULE "B" PLAN OF ARRANGEMENT ... B‐1 SCHEDULE "C" UNAUDITED PRO FORMA FINANCIAL STATEMENTS ... C‐1 SCHEDULE "D" FAIRNESS OPINION ... D‐1
NOTICE TO UNITED STATES SECURITYHOLDERS
Endeavour is an exempted company with limited liability existing under the laws of the Cayman Islands. The proxy solicitation rules under Section 14(a) of the U.S. Exchange Act are not applicable to Endeavour or this solicitation, and, accordingly, this solicitation is not being effected in accordance with such rules. Securityholders should be aware that disclosure requirements under Canadian securities laws may be different from requirements under the U.S. Exchange Act.
Information concerning the properties and operations of Avion and Endeavour has been prepared in accordance with the requirements of Canadian securities laws, which differ from the requirements of United States securities laws. Unless otherwise indicated, all mineral reserve and mineral resource estimates included or incorporated by reference in this Information Circular have been prepared in accordance with NI 43‐101 and the Canadian Institute of Mining, Metallurgy and Petroleum definitions and classification system. NI 43‐101 is a rule developed by the Canadian Securities Administrators which establishes standards for all public disclosure an issuer makes of scientific and technical information concerning mineral projects.
Canadian standards, including NI 43‐101, differ significantly from the requirements of the SEC, and mineral reserve and mineral resource information contained or incorporated by reference in this Information Circular may not be comparable to similar information disclosed by United States companies. In particular, and without limiting the generality of the foregoing, the term "resource" does not equate to the term "reserve". Under United States standards, mineralization may not be classified as a "reserve" unless the determination has been made that the mineralization could be economically and legally produced or extracted at the time the reserve determination is made. The SEC's disclosure standards normally do not permit the inclusion of information concerning "measured mineral resources", "indicated mineral resources" or "inferred mineral resources" or other descriptions of the amount of mineralization in mineral deposits that do not constitute "reserves" by United States standards in documents filed with the SEC. United States investors should also understand that "inferred mineral resources" have a great amount of uncertainty as to their existence and as to their economic and legal feasibility. It cannot be assumed that all or any part of an "inferred mineral resource" will ever be upgraded to a higher category. Under Canadian rules, estimates of "inferred mineral resources" may not form the basis of feasibility or pre‐ feasibility studies except in rare cases. Disclosure of "contained tonnes" in a mineral resource estimate is permitted disclosure under NI 43‐101 provided that the grade or quality and the quantity of each category is stated; however, the SEC normally only permits issuers to report mineralization that does not constitute "reserves" by SEC standards as in place tonnage and grade without reference to unit measures. The requirements of NI 43‐101 for identification of "reserves" are also not the same as those of the SEC, and reserves reported in compliance with NI 43‐101 may not qualify as "reserves" under SEC standards. Accordingly, information contained in this Information Circular and the documents incorporated by reference herein containing descriptions of mineral deposits may not be comparable to similar information made public by U.S. companies subject to the reporting and disclosure requirements under the U.S. federal securities laws and the rules and regulations thereunder.
Financial statements included or incorporated by reference in this Information Circular have been prepared in accordance with International Financial Reporting Standards, which differs from U.S. generally accepted accounting principles in certain material respects, and thus they may not be comparable to financial statements of U.S. companies. Shareholders should be aware that the Arrangement described in this Information Circular may have tax consequences in both the United States and Canada and should consult with their own tax advisors about those consequences.
The enforcement by securityholders of civil liabilities under U.S. securities laws may be affected adversely by the fact that each of Endeavour and Avion is incorporated or organized outside the United States, that some or all of their respective directors and officers and the experts named in this Information Circular are not residents of the United States and that all or a substantial portion of their respective assets and said persons may be located outside the United States. As a result, it may be difficult or impossible for U.S. securityholders to effect service of process within the United States upon Endeavour or Avion, their respective officers and directors or 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, U.S. securityholders should not assume that the courts of Canada: (a) would enforce 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) would enforce, 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.
STATEMENTS REGARDING FORWARD‐LOOKING INFORMATION
This Information Circular, the pro forma financial statements of Endeavour and certain of the material incorporated by reference into this Information Circular contain "forward‐looking information" within the meaning of Canadian securities legislation and "forward‐looking statements" within the meaning of the
United States Private Securities Litigation Reform Act of 1995 (collectively, "forward‐looking statements").
These forward‐looking statements are made as of the date of this document or as of the date of the document from which they are incorporated by reference.
Forward‐looking statements relate to future events or future performance and reflect the expectations or beliefs of management of Endeavour and Avion regarding future events, and include, but are not limited to, statements with respect to the timing and implementation of the proposed Arrangement, the anticipated benefits of the Arrangement, the integration of Endeavour and Avion following the Arrangement, estimation of mineral reserves and mineral resources, availability of cash flow to fund capital requirements, the timing and amount of estimated future production, availability of project financing, and success of mining and development operations. Material factors and assumptions upon which such forward‐looking statements are based include: that the required approvals will be obtained from the Endeavour Shareholders and Avion Securityholders, that ICA Approval and all other required third party, court, regulatory and governmental approvals to the Arrangement will be obtained, assumptions made in connection with the preparation of the pro forma financial statements included herein, that all other conditions to the completion of the Arrangement will be satisfied or waived, that the future business operations and prospects of Endeavour and Avion will be consistent with Endeavour and Avion's current expectations, synergies and related benefits of the Arrangement will be realized, that projections are accurate, as well as the long term metals and consumable commodity prices and foreign exchange rates. These assumptions are based on factors and events that are not within the control of Endeavour or Avion and there is no assurance they will prove to be correct.
In certain cases, forward‐looking statements can be identified by the use of words such as "plans", "expects" or "does not expect", "is expected", "budget", "potential", "scheduled", "estimates", "forecasts", "intends", "anticipates" or "does not anticipate", or "believes", or variations of such words and phrases or statements that certain actions, events or results "will", "may", "could", "would", "might" or "will be taken", "occur" or "be achieved" or the negative of these terms or comparable terminology. By their very nature forward‐looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of Endeavour and Avion to be materially
different from any future results, performance or achievements expressed or implied by the forward‐ looking statements. A variety of material factors include, among others: failure to complete the Arrangement could negatively impact the market price of Endeavour Shares and future business and financial results; a "market overhang" could adversely affect the market price of Endeavour Shares after completion of the Arrangement; the integration of Endeavour and Avion may not occur as planned; public disclosure of Avion may not be fully in compliance with securities legislation; New Endeavour may be subject to significant capital requirements and operating risks associated with its expanded operations and its expanded portfolio of growth projects; as well as those risks described under the headings "Risk Factors
– Risks Relating to the Business of Endeavour" and "Risk Factors – Risks Relating to the Business of Avion
and New Endeavour" in this Information Circular, the risks relating to each of Endeavour and Avion in their
annual information forms for the year ended December 31, 2011, as well as any other risk factors detailed from time to time in Endeavour's and Avion's condensed interim and annual consolidated financial statements and management's discussion and analysis of those statements, all of which are filed and available for review on SEDAR at www.sedar.com. Although each of Endeavour and Avion has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward‐looking statements, there may be other factors that cause actions, events or results not to be as anticipated, estimated or intended. Endeavour and Avion provide no assurance that forward‐looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Endeavour and Avion do not intend, and do not assume any obligation, to update any forward‐looking statements, other than as required by applicable law. Accordingly, readers should not place undue reliance on forward‐looking statements.
INFORMATION CONCERNING AVION
All of the information concerning Avion contained in this Information Circular has been taken from or is based upon publicly available documents, records and information available on SEDAR or other public sources or has been provided by Avion for inclusion in this Information Circular. Pursuant to the Arrangement Agreement, Avion has covenanted to provide to Endeavour all information regarding Avion, its subsidiaries and the Avion Shares as required by applicable laws, and to ensure that such information does not contain a misrepresentation. Although Endeavour has no knowledge that would indicate that any statements contained herein concerning Avion taken from or based upon such documents, records and information contains a misrepresentation, neither Endeavour nor any of its directors or officers assumes any responsibility for the accuracy or completeness of such information, including any of Avion's financial statements or Avion's mineral reserve and mineral resource estimates, or for any failure by Avion to disclose events or facts which may have occurred or which may affect the significance or accuracy of any such information but which are unknown to Endeavour. Endeavour has limited means of verifying the accuracy or completeness of any of the information contained herein that is derived from Avion's publicly available documents, records or information or whether there has been any failure by Avion to disclose events that may have occurred or may affect the significance or accuracy of any information.
For further information regarding Avion, please refer to Avion's filings with the Canadian Securities Administrators which may be obtained on its profile on the SEDAR website at www.sedar.com.
REPORTING CURRENCIES AND ACCOUNTING PRINCIPLES
Unless otherwise indicated, all references to "C$" in this Information Circular refer to Canadian dollars, references to "A$" refer to Australian dollars and references to "US$" refer to United States dollars. Endeavour's financial statements included herein and incorporated by reference are reported in United States dollars and are prepared in accordance with International Financial Reporting Standards. Avion's
financial reports included herein and incorporated by reference are reported in United States dollars and are prepared in accordance with International Financial Reporting Standards.
CURRENCY EXCHANGE RATE INFORMATION
The following table sets forth the high and low exchange rates for one U.S. dollar expressed in Australian dollars for each period indicated, the average of the exchange rates for each period indicated and the exchange rate at the end of each such period, provided by the Reserve Bank of Australia:
6 Months Ended Year Ended December 31
A$ June 30, 2012 2011 2010 2009 High 1.0336 1.0526 1.2261 1.5823 Low 0.9246 0.9046 0.9833 1.0696 Rate at end of period 0.9813 0.9846 0.9840 1.1150 Average rate for period 0.9690 0.9700 1.0903 1.2804 On September 10, 2012, the exchange rate for one U.S. dollar expressed in Australian dollars provided by the Reserve Bank of Australia was A$0.9661.
The following table sets forth the high and low exchange rates for one U.S. dollar expressed in Canadian dollars for each period indicated, the average of the exchange rates for each period indicated and the exchange rate at the end of each such period, based upon the noon buying rates provided by the Bank of Canada:
6 Months Ended Year Ended December 31
C$ June 30, 2012 2011 2010 2009 High 1.0418 1.0604 1.0778 1.3000 Low 0.9807 0.9449 0.9946 1.0292 Rate at end of period 1.0191 1.0170 0.9946 1.0466 Average rate for period 1.0057 0.9891 1.0299 1.1420
On September 10, 2012, the exchange rate for one U.S. dollar expressed in Canadian dollars based upon the noon buying rates provided by the Bank of Canada was C$0.9762.
ENDEAVOUR MINING CORPORATION
MANAGEMENT INFORMATION CIRCULAR
Q & A ON THE ARRANGEMENT, VOTING RIGHTS AND SOLICITATION OF PROXIES
This Information Circular is dated September 10, 2012 and, unless otherwise stated, the information in this Information Circular is as of September 10, 2012. For ease of reference, a glossary of capitalized terms used in this Information Circular can be found starting at page 15.
What is this document?
This Information Circular is a management information circular sent to Endeavour Shareholders in advance of a special meeting of Endeavour Shareholders to be held in connection with the proposed Arrangement of Endeavour and Avion, as set out in the Notice of Meeting. This Information Circular provides additional information respecting the business of the Meeting. References in this Information Circular to the Meeting include any adjournment or postponement that may occur. A form of proxy or voting instruction form accompanies this Information Circular.
When and where is the Meeting?
The Meeting will be held at the Metropole Hotel, 4 Avenue de la Madone, BP 19, 98007 Monaco, on October 12, 2012 at 10:00 a.m. (Monaco time).
Why is the Meeting being held?
The Meeting is being held in order to approve the issuance of Endeavour Shares in connection with the Arrangement. Pursuant to the listing rules of the TSX, a listed company is generally required to obtain shareholder approval in connection with an acquisition where the number of securities issued or issuable in payment of the purchase price for the acquisition exceeds 25% of the number of securities of the listed issuer which are outstanding, on a Non‐Diluted Basis, prior to the date of closing of the acquisition. As the
Arrangement will result in Endeavour issuing in excess of 25% of the outstanding Endeavour Shares,
Endeavour Shareholder approval is required. It is a condition of the Arrangement that the Share
Issuance Resolution be approved by a simple majority (50% plus one) of votes cast at the Meeting by
Endeavour Shareholders, present in person or by proxy. Endeavour is seeking the approval of Endeavour Shareholders to issue up to 176,500,000 New Endeavour Shares in connection with the Arrangement, representing approximately 72% of the 245,091,769 Endeavour Shares outstanding as at September 10, 2012.
Why is Endeavour proposing to acquire Avion?
In reaching its decision to approve the Arrangement and its recommendation that Endeavour Shareholders vote in favour of the Share Issuance Resolution, the Endeavour Board considered the positive results of the due diligence review conducted by management and Endeavour's financial, technical and legal advisors, as well as the following background and attributes:
Unlocking Value at Tabakoto. Endeavour believes that Avion's market valuation does not reflect
the intrinsic value of its underlying mining and development assets. Avion's principal asset is the Tabakoto Gold Mine in Western Mali, which is experiencing financial difficulties associated with a mill capacity expansion project that was suspended when approximately 80% complete, due to
contractor demobilization following the 2012 coup in Mali. Avion is both a good fit with Endeavour's existing West African asset base and with Endeavour's skills and expertise. Endeavour expects that its financial strength combined with its regional and operational capabilities will unlock value from the Tabakoto Gold Mine. To enable the rapid restart of the Tabakoto mill capacity expansion, Endeavour provided a US$20 million short term Exchangeable Loan to Avion. This funding facilitates the re‐mobilization of contractors without further delay. The capacity upgrade is expected to increase Tabakoto Gold Mine production from current levels of 95,000 to 102,000 ounces per year to over 150,000 ounces per year.
Gold Production Growth. The acquisition will immediately increase 2012 forecast gold production
by approximately 50% to between 282,000 and 304,000 ounces, and including the Tabakoto mill expansion and completion of construction of the Agbaou Gold Project, gold production is forecast to reach approximately 450,000 ounces per year.
Resource and Reserve Base. Endeavour's NI 43‐101 compliant attributable Proven and Probable
gold reserves will increase by 31% to 2.8 million ounces, Measured and Indicated gold resources will increase by 52% to 6.0 million ounces, and Inferred gold resources will increase by 167% to 3.3 million ounces.2
Pipeline for West African Exploration and Development Growth. The acquisition will add a portfolio
of highly prospective exploration properties to Endeavour's existing West African land package, which will exceed 11,800km². Avion's Houndé project in Burkina Faso is progressing towards a preliminary economic assessment which is anticipated by year end. Current resources are 893,000 indicated ounces and 712,000 inferred ounces. Avion's Kofi Project in Western Mali currently hosts 500,000 indicated ounces and 702,000 inferred ounces. These properties are attractive additions to the Endeavour growth profile that already includes the Nzema sulphides project in Ghana and the Ouaré deposit in Burkina Faso.
Improvements and Efficiency Gains. Endeavour has a track record of successfully optimizing assets
with timely capital investments and using the skills of its experienced operations and project development teams, which are led by an experienced and centralized senior operations team based in Accra, Ghana. The Tabakoto Gold Mine is a complementary addition to Endeavour's West African operating platform.
Financial Strength. The new Endeavour is expected to have a strong financial profile, with pro
forma cash and cash equivalents of over US$51 million (as of June 30, 2012 and net of the US$100 million drawn from the corporate loan facility), plus operating cashflow from three mines and access to a US$200 million revolving corporate loan facility (to be used for general corporate purposes, capital expenditure and acquisitions). New Endeavour anticipates additional cash proceeds of up to approximately C$115 million from options and warrants having an exercise price of C$2.50 or less.
Enhanced Capital Markets Profile. With a combined market capitalization of approximately C$977
million (August 7, 2012 acquisition announcement date basis), Endeavour is emerging as a mid‐tier gold producer. Growing the annual gold production rate and expanding the pipeline of future
2
Each category of reserves and resources is separately reported under the heading "New Endeavour – Resources and Reserves".
development projects improves Endeavour's market visibility, and potentially attracts a wider group of investors as well as increasing trading liquidity and broadening analyst coverage.
Who is eligible to vote?
Holders of Endeavour Shares at the close of business (Vancouver time) on September 7, 2012 and their duly appointed representatives are eligible to vote.
How is the Arrangement being implemented?
The Arrangement involves the acquisition by Endeavour of Avion, subject to satisfaction or waiver of certain conditions. The Arrangement will be implemented by way of a court‐approved plan of arrangement under the OBCA. Under the terms of the Arrangement, the articles of Avion will be amended to create an unlimited number of Exchangeable Shares and an unlimited number of New Avion Shares, and each Avion Share will be exchanged by its holder for either 0.365 of a New Avion Share or, at the election of an Eligible Avion Shareholder, 0.365 of an Exchangeable Share. Each New Avion Share will then be transferred and assigned to a wholly‐owned subsidiary of Endeavour, being either Endeavour SubCo or Endeavour Gold, in exchange for one New Endeavour Share. Subject to certain exceptions, Exchangeable Shares will be exchangeable by the holder until the sixth anniversary of the Effective Date for one (1) Endeavour Share and a cheque representing any dividend payments that may be payable at such time. As a result of the foregoing, upon closing of the Arrangement, Endeavour will indirectly own all of the voting shares of Avion and Avion will be a subsidiary of Endeavour. Endeavour Shareholders will continue to hold their existing Endeavour Shares.
Each Avion Option that has not been exercised prior to the Effective Date will be adjusted in accordance with its terms such that each such Adjusted Option will be exercisable for the number of Endeavour Shares equal to 0.365 multiplied by the number of Avion Shares subject to such Avion Option immediately prior to the Effective Time at an exercise price equal to the exercise price of such Avion Option divided by 0.365. Notwithstanding the terms of the Avion Options or the Avion Option Plan, each Adjusted Option will remain in effect for the full term to expiry of the corresponding original Avion Option. All other terms and conditions of each Adjusted Option will remain the same and will be governed by the terms of the Avion Option Plan.
All of the New Endeavour Shares deliverable upon exchange of the Exchangeable Shares will be issued to Endeavour Cayman, a wholly‐owned subsidiary of Endeavour, prior to the Arrangement becoming effective. Endeavour Cayman will hold the voting rights attached to such New Endeavour Shares in trust for the benefit of the holders of the Exchangeable Shares, who will be entitled to direct the voting of such New Endeavour Shares.
When does Endeavour expect the Arrangement to be completed?
The completion of the Arrangement is subject to several conditions that must be satisfied or waived, including: Avion Securityholder Approval, Endeavour Shareholder Approval, the approval of the Court, and satisfaction of governmental or regulatory conditions including ICA Approval and approval of the TSX. Assuming that all of the conditions to the Arrangement are satisfied, Endeavour expects that the Arrangement will become effective on or about October 18, 2012.
What does the Endeavour Board and Management think of the Arrangement?
After careful consideration of the Arrangement and the rationale set forth in "The Arrangement –
Reasons for the Arrangement", the Endeavour Board has determined that entering into the Arrangement
Agreement is in the best interests of Endeavour and has unanimously RECOMMENDED that Endeavour
Shareholders VOTE IN FAVOUR of the Share Issuance Resolution.
Each member of the Endeavour Board and each executive officer has informed Endeavour that they intend to vote the voting rights attached to all Endeavour Shares over which they have control in favour of the Share Issuance Resolution (subject to the terms of the Arrangement Agreement and the Avion Voting Agreement) and have formally agreed to do so by entering into the Avion Voting Agreement.
Who will be Chairman of New Endeavour?
Michael Beckett, the current chairman of Endeavour, will remain as Chairman of New Endeavour. Who will be CEO of New Endeavour?
Endeavour's current CEO, Neil Woodyer, will be the CEO of New Endeavour. Who will be officers of New Endeavour?
Following completion of the Arrangement, it is expected that Endeavour's current CEO, Neil Woodyer, will be the CEO of New Endeavour; Endeavour's current CFO, Christian Milau, will be the CFO of New Endeavour and Endeavour's current COO, Adriaan "Attie" Roux, will be the COO of New Endeavour.
Who will be on New Endeavour's Board?
Upon completion of the Agreement, it is expected that the Endeavour Board will be increased from seven to eight directors. In addition to the Chairman, Michael Beckett, it is expected that New Endeavour's board of directors will be comprised of the following current members of the Endeavour Board: Neil Woodyer, Jorge Gamarci, Wayne McManus, Mark Connelly and Dr. Antony Harwood; and that John Begeman, the current CEO and President of Avion and James H. Coleman, the current Chairman of Avion, will be appointed as new directors. In order to facilitate these appointments it is expected that Martin Reed will resign from the Endeavour Board at the Effective Time. See "New Endeavour – Directors and Officers" for a further description of each director's profile). As a result of these changes to the Endeavour Board, it is expected that membership in certain board committees will be adjusted upon completion of the Arrangement.
What other conditions must be satisfied to complete the Arrangement?
The Arrangement is conditional upon, among other things, the satisfaction or waiver of the following: the approval of the Share Issuance Resolution by a simple majority (50% plus one) of the votes cast at the Meeting by Endeavour Shareholders, present in person or by proxy; the approval of the Arrangement by Avion Securityholders, by 66 2/3% of the votes cast at the Avion Meeting, present in person or by proxy; following the Avion Securityholder Approval, approval of the Arrangement by the Court;
ICA Approval; and
the TSX providing such consents, waivers, modifications, exemptions, approvals and doing other such acts necessary to implement the Arrangement, including the conditional approval of the TSX to list the New Endeavour Shares issuable in connection with the Arrangement. See the sections of this Information Circular entitled "The Arrangement Agreement – Conditions to the
Arrangement", "The Arrangement ‐ Approvals" and "The Arrangement – Approvals – Regulatory
Approvals".
Am I entitled to dissent rights?
No. Endeavour Shareholders are not entitled to dissent rights in connection with the actions to be taken at the Meeting.
How will the Arrangement affect my ownership and voting rights as a shareholder of Endeavour?
The following table describes and summarizes the expected share capital of New Endeavour following completion of the Arrangement, on a Fully‐Diluted Basis, based on the number of Avion and Endeavour securities outstanding as at September 10, 2012 (unless otherwise stated): Number of Endeavour Shares Current Endeavour Shares issued and outstanding 245,091,769 Issued in respect of outstanding Avion Shares 161,909,653(1)
Total (Non‐Diluted) 407,001,422
Reserved for issuance on exercise of Endeavour "A" Listed Warrants 32,487,501 Reserved for issuance on exercise of Endeavour Unlisted Warrants 679,737 Reserved for issuance on exercise of Endeavour Options 17,383,276 Reserved for issuance on exercise of Adjusted Options 13,843,482 Reserved for issuance of shares for Avion purchased concessions(2) 410,625
Total (Fully‐Diluted) 471,806,043
Note:
(1) Includes 20,531 Endeavour Shares issuable under the Arrangement in respect of 56,250 Avion Shares which are
issuable on September 11, 2012 with respect to the Walia Saakola and Walia concessions.
(2) Includes 82,125 Endeavour Shares payable on each of January 11, 2013, July 11, 2013 and January 11, 2014 with
respect to the Kofi‐Soundoundjala concession and 16,250 Endeavour Shares which may be issuable with respect to
the Kenieti‐Serhokoto and Netekoto‐Kenieti concessions.
Following the Arrangement, Endeavour Shareholders will continue to hold their existing Endeavour Shares and CDIs. Endeavour expects that an aggregate of up to approximately 161,889,122 New Endeavour Shares will be issued in respect of the Avion Shares outstanding as at September 10, 2012, representing 66.1% of the 245,091,769 Endeavour Shares outstanding as at September 10, 2012, on a Non‐Diluted Basis. Endeavour expects that an aggregate of up to approximately 175,732,604 New Endeavour Shares will be issued or issuable in respect of the Avion Shares and Avion Options outstanding as at September 10, 2012, representing 59.4% of the 295,642,283 Endeavour Shares outstanding as at September 10, 2012, on a Fully‐Diluted Basis. However, Endeavour is seeking approval for the issuance of up to 176,500,000 New Endeavour Shares in connection with the Arrangement, representing approximately 72% of the
245,091,769 Endeavour Shares outstanding as at September 10, 2012. This is in order to provide Endeavour with the ability to complete the Arrangement in the event that there is an immaterial increase in the number of Avion Securities outstanding between September 10, 2012 and the date the Arrangement becomes effective; it will additionally allow Endeavour to issue up to 431,156 New Endeavour Shares with respect to Avion's payment obligations for certain exploration concessions that are or may become due after the Arrangement becomes effective.
Under any of these scenarios, the Endeavour Shareholders' ownership and voting interests in New Endeavour will be diluted, relative to their current proportional ownership and voting interest in Endeavour.
Are there risks I should consider in connection with the Arrangement?
Yes. A number of risk factors that you should consider in connection with the Arrangement are described in the section of this Information Circular entitled "Risk Factors".
What are the Exchangeable Shares and why are they being issued to Avion Shareholders?
The Exchangeable Shares are non‐voting redeemable preferred shares in the capital of Avion to be created and issued on the reorganization of Avion's capital pursuant to the Arrangement. Each Exchangeable Share is exchangeable or redeemable for one Endeavour Share. Exchangeable Shares are being offered to Eligible Avion Shareholders because they provide Eligible Avion Shareholders with the ability to defer the Canadian federal income tax consequences of the exchange until such time as the Exchangeable Shares are exchanged or redeemed (rather than immediately, which would be the case if they received New Endeavour Shares under the Arrangement). For more information on the terms of the Exchangeable Shares see "Structure of the Arrangement".
The Exchangeable Shares will be shares in the capital of Avion but such shares are exchangeable for Endeavour Shares.
What is the Exchangeable Loan?
In connection with the Arrangement, Endeavour has provided a US$20 million short term Exchangeable Loan to Avion, in order to provide Avion with the capital needed to restart the mill expansion at Avion's Tabakoto Gold Mine in western Mali, and for other corporate needs. The repayment date of the Exchangeable Loan is February 10, 2013, and, subject to certain exceptions, it may be repaid in cash or by the delivery of Avion Shares to Endeavour. For more information on the terms of the Exchangeable Loan see "Exchangeable Loan to Avion".
How do I vote?
Endeavour Shareholders may be "Registered Endeavour Shareholders" or "Beneficial Endeavour Shareholders". If an Endeavour Shareholder's name appears on a physical share certificate, such Shareholder is a "Registered Endeavour Shareholder". If an Endeavour Shareholder holds Endeavour Shares through an intermediary, such as a bank, trust company, securities dealer, broker or other nominee or a clearing agency, such Endeavour Shareholder is a "Beneficial Endeavour Shareholder" and he, she, or it will not have a physical share certificate and his, her or its Endeavour Shares will be registered in the name of an intermediary or a clearing agency in which an intermediary participates (such as CDS Clearing and Depository Services Inc. or CHESS Depositary Nominees Pty Ltd). Such Beneficial Endeavour
Shareholder will typically have an account statement from his or her bank or broker as evidence of his or her Endeavour Share ownership.
If you are not a Registered Endeavour Shareholder, instead of a form of proxy you may find enclosed a voting instruction form – please see the section of this Information Circular entitled "General Proxy
Information – Execution and Revocation of Proxies – Beneficial (Non‐Registered) Endeavour Shareholders"
for instructions on how to ensure you are represented at the Meeting. Registered Endeavour Shareholders
Registered Endeavour Shareholders have two methods by which they can vote their Endeavour Shares at the Meeting; namely, in person or by proxy. To assure representation at the Meeting, Registered Endeavour Shareholders are encouraged to complete and return the enclosed form of proxy.
If you are a Registered Endeavour Shareholder, you are requested to complete, sign, date and return the enclosed form of proxy so that it will be received at the office of the registrar and Transfer Agent of the Endeavour Shares by 10:00 a.m. (Monaco time) on Wednesday, October 10, 2012, or not less than 48 hours before the commencement of any adjournment or postponement of the Meeting. Alternatively, you may submit your vote via the internet at www.investorvote.com, by telephone at 1‐866‐732‐8683 (toll free in North America) or +1 312‐588‐4290 (international), by facsimile to 1‐866‐249‐7775 (toll free in North America) or +1 416‐263‐9524 (international), or by appointing another person to attend the Meeting and vote your Endeavour Shares on your behalf.
If you are a Registered Endeavour Shareholder and plan to attend the Meeting at the Metropole Hotel, 4 Avenue de la Madone, BP 19, 98007 Monaco, on Friday, October 12, 2012 and wish to vote your Endeavour Shares in person, please register with the scrutineer upon arrival at the Meeting.
If you have questions or require assistance with voting your shares, you may contact Endeavour's proxy solicitation agent, The Laurel Hill Advisory Group, by email at [email protected] or by telephone at 1‐877‐304‐0211 (toll free within Canada or the U.S.) or +1 (416) 304‐0211 (for collect calls outside Canada and the U.S.).
Beneficial Endeavour Shareholders
Only registered holders of Endeavour Shares, or the persons they appoint as proxies, are permitted to attend and vote at the Meeting.
Endeavour has distributed copies of this Information Circular to intermediaries for distribution to Beneficial Endeavour Shareholders. Intermediaries are required to deliver these materials to all Beneficial Endeavour Shareholders who have not waived their rights to receive these materials, and to seek instructions as to how to vote their Endeavour Shares. Typically, intermediaries will use a service company (such as Broadridge Financial Solutions, Inc., or "Broadridge") to forward the meeting materials to Beneficial Endeavour Shareholders. Beneficial Endeavour Shareholders who have not waived the right to receive meeting materials will receive either a VIF or, less frequently, a form of proxy. The purpose of these forms is to permit Beneficial Endeavour Shareholders to direct the voting of the shares they beneficially own. Beneficial Endeavour Shareholders should carefully follow the instructions provided on their VIF or form of proxy to ensure their Endeavour Shares will be voted.
If you are a Beneficial Endeavour Shareholder and wish to: vote in person at the Meeting; or change voting instructions given to your intermediary; or revoke voting instructions given to your intermediary and vote in person at the Meeting, follow the instructions given by your intermediary or contact your intermediary to discuss what procedure to follow. There are two kinds of beneficial owners: those who object to their name being made known to the issuers of securities which they own (called "OBOs" for Objecting Beneficial Owners) and those who do not object (called "NOBOs" for Non‐Objecting Beneficial Owners). Endeavour may be utilizing the Broadridge QuickVoteTM service to assist Endeavour Shareholders with voting their Endeavour Shares. NOBOs may be contacted by Laurel Hill to conveniently obtain a vote directly over the telephone.
If you have questions or require assistance with voting your shares, you may contact Endeavour's proxy solicitation agent, The Laurel Hill Advisory Group, by email at [email protected] or by telephone at 1‐877‐304‐0211 (toll free within Canada or the U.S.) or +1 (416) 304‐0211 (for collect calls outside Canada and the U.S.).
CDI Holders
Beneficial holders in Australia hold CDIs of Endeavour, or units of beneficial ownership of the underlying ordinary shares, which are registered in the name of CDN. As holders of CDIs are not the legal owners of the underlying ordinary shares, CDN is entitled to vote at the Meeting at the instruction of the holders of the CDIs.
As a result, holders of CDIs will receive a VIF, together with the meeting materials from Computershare in Australia. These VIFs are to be completed and returned to the Transfer Agent in Australia in accordance with the instructions contained therein. CDN is required to follow the voting instructions properly received from holders of CDIs.
To obtain a copy of CDN's Financial Services Guide, go to www.asx.com.au/cdis. Phone +02 9227 0885 (within Australia) or +61 2 9338 0000 (overseas) if you would like a copy sent to you in the mail.
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