Important note to shareholders - Rollover Relief applied for

Please note that the Company has applied to the ATO for rollover tax relief arising from the demerger. If this is granted and the participating Australian shareholder chooses rollover, any capital gains tax that arises as a result of the demerger will be disregarded.

The total combined cost base after the demerger is calculated at 25.84 cents being the sum of a 5 day Volume weighted average share price of AZX shares after the implementation date of 6 January 2012 (18.66 cents) and a fair value calculation of AEL shares based of a net asset valuation of $9,343,440 as recorded in the AZX half year audit reviewed accounts as a capital reduction (7.18 cents)

A shareholder should therefore reasonably apportion 72.2% of their original cost base to their Auzex Resources shares and 27.8% of their original cost base to Auzex Exploration shares.

If rollover is available, but a participating Australian shareholders do not choose rollover tax relief, any capital gain is not disregarded and they must adjust their cost base in the same manner as if they had chosen rollover.

If rollover is not available, participating Australian shareholders must reduce the cost base and reduced cost base of their Auzex Shares by the amount of the capital reduction being 7.18 cents. The first element of the cost base of AEL shares received will be 7.18 cents.

For further information please refer to Section 8.2 of the Demerger Scheme Booklet dated 11 November 2011.